What's your buying criteria for STRs in 2022?

[Garrett Kroll]

As STR markets evolve and prices continue to climb, I was curious what criteria folks ares using to decide to make an offer or not. Not specifically talking about market requirements, but more for the property itself. What are your minimum requirements, and have they changed in the last 6 months?

I'll share mine:

- Target CoC of 25%+, 35%+ if a partner deal. This doesn't include PM as we self-manage (we plan to hire a PM once we hit our desired scale)

- Cash flow of $2k

- Break even occupancy (i.e. CoC of 0%) is half of the target occupancy or lower. This is essentially a buffer for error/reduced demand/the unknown. It's a new metric I'm tracking and helps me feel better about high purchase prices.

There are some additional qualitative requirements but from a pure numbers perspective, this is it. Curious what you all are using!

[Dave Stokley]

For all the clients I'm advising on new purchases we're targeting 20% COC after all expenses, including my management fee.

We are looking for turnkey SFRs with at least 3-bedrooms, and specifically shifting focus to more vacation-y areas, although there are still some attractive opportunities in and around Cleveland.