Moving to Short Term Rentals

[Josh Fisher]

I have a long term rental, that is not cash flowing. I am interested in starting a few Short Term Rentals in SoCal. I am looking for someone that has done this to give me some advice on starting out. I don't have a ton of capitol to get going, but I have found 3 potential deals. What are some struggles and pain points that I may not be accounting for when estimating on the calculators. One of the areas restrict the number of days you can provide short term rentals, although, this house is just outside of the boundary for that. So I believe it is a good area. AirDNA reports this City as an A grade area. I am also looking for someone to fund me for these houses. Where can I start to get someone to lend me $400000, or to partner with me on the deals. I do the work they finance the deals. Thanks for your input. I can send you the addresses if you like, not sure if I want to post them on the public forums.

[Andy Eakes]

What would the rental situation look like if you rented out the extra room in your long term rental? The best short term rental strategy I have come across would be to buy a property and have it as your primary residence to take advantage of leverage opportunities and then use it as an Air BNB. I would target multi unit properties where you could live in a unit and Air BNB the other unit. If you can Air BNB it that first month too you can cash flow heavily while you're waiting on that first mortgage payment. I also have a buddy who loves to travel so he'll travel for a month or stay with family while his place is rented out. He'll stay in hostels when traveling to keep his costs low. 

Finally, I live in a city with Air BNB month long restrictions like you explain and something that I have picked up when it comes to that rule is that you don't have to rent out your place for 28 days at a time. The rule only asks that you have one renter per 28 days. So what I see is people will rent out their place for a weekend or week and then live in it for the rest of the month. You could never require a person to stay in your place for exactly 28 days. I see a lot of confusion with that rule.

And finally, I wouldn't come on Bigger Pockets and ask people to invest in the properties you want to buy unless your name is Brandon Turner. Too many newbies out there posting similar stuff, and too many "gurus" on here claiming to have the secret to REI. The best way to get investors to fund your deals and trust in you is to start meeting people in your areas. Attend meet ups and networking events. People usually work with a family member or close friend the first time they use someone else's money to gain the experience they need to prove themselves to a potential investor outside of their sphere.

Hope that helps.