STR Property Calculation and Offering Over Asking

[Nicole Demos]

Hello BP! I am a newbie still trying to get my first accepted offer. I'm in the Catskill region of NY hoping to purchase a property for STR. I've put in several offers but nothing has been accepted. I'm putting in an offer on another property (final and best due at the end of the week) and would love some input! Here is the info and my estimations:

Property: 2 bd/1 bath cottage and 1 loft/1 bath tiny house on 1 acre, both turn key

Asking: 390K

Taxes: 5K/year

Utilities: 500/month

Grass/snow: 400/month

Insurance: 1K/year

Occupancy: 61%

Rental rate: $200/night and $100/night (looking at other properties they may rent for 250 and 200/night but I’m being conservative)

Down payment: 10%

I’ve been doing calculations with pretty conservative numbers. I can offer even up to 460K and it can still cash flow, but it’s been difficult for me to tell at what point the offer is too high. It’s a unique property making it difficult to find comps and I’m not sure what it will appraise for either. I have offered well above asking in the past. I had the highest offer but was asked if I could pay the potential appraisal difference in cash, which I could not. It’s possible the property appraised for more than my offer and I missed out on the deal because of this unknown. For this reason I am hesitant to offer too high again, even if the numbers work.  

I appreciate any and all responses! Thanks!

[John Underwood]

I also like to use "$1000 over highest offer not to exceed $xxxxx.

This keeps you from being way higher than the next highest offer. Some realtors will not like it because they are not used to seeing it but they work for you.