Turn Key Property Management

[Michael Bolduc]

Hi! Has anyone has any success using a turnkey STR property management company in the Orlando area? I am based in Montreal, Quebec but am looking into investing in the US. Ideally we would purchase a property through the company and have it completely managed by them afterward. We are open to any suggestions either way. Thanks!

[Shawn McCormick]

Quote from @Michael Baum:

Hey @Shawn McCormick. I believe it can be done, but the places I looked at didn't pencil out. I have chatted with a few members that tell me the larger places do better, but the entry price into a 6 or 7 bedroom is quite high and if it doesn't have theme rooms already done, that is a large expense. That seems to be required in the Orlando market.

My wife liked the idea of us getting a place down there where we could go with the family, but I just don't see how it can make any money.

As far as PM's go, what is the average rate down there? We have had several PM's want to manage our Idaho lake house and it was 35% of gross. Full service. No way I can make a profit with that.

Frankly, anything more than 10% doesn't seem to work with HOA dues and expenses. I wouldn't pay 10% for answering inquiries etc like Evolve offers.

Not trying to disparage anyone, but I just forgot about the general Orlando area as a money maker at this time. 

 I agree that in our market in Orlando, bigger homes will typically do better and that is just a numbers game, there are far less of 5+ bedroom homes than 2,3,4 ( you are competing against hotels, condotels, condos, townhomes and small single family). If you can get in one of the 'top 10' communities close to Disney, you can/will make money. However, you are basically running a small business and how you take care of the property, respond to guests, level of theming, cleanliness and rates will all have an impact on how well you do. Most are owned by out of state or out of country investors that may not have the time, experience or level of concern needed to be successful. 

As @Jay Breitlow mentioned, he runs a great, full service PM and is only 15% with no contracts. At minimum hire a PM to point out deficiencies in your home, get reviews logged quickly and stabalize a nightly rate strategy that will let you take advantage of peak weeks/months. Our 'season' is all year long, but we do have highs and lows, so looking at nightly rates for $69 a night like you mentioned could be in a community that is not well ammenitized, not close to Disney, not themed or simply during a period of time that was a historically slow week/month. You have to look at these (in Orlando) by the quarter, not by a small snapshot of time while you were doing your research...look at calendars for a whole quarter and average it out. STR are never 'always full' so if you and your family want to use it, you should plan your time there during periods that are slower and take advantage of the guests coming during peak times.

What is your strategy, have a place that you can come to and have it pay for itself the rest of the year, or a place to park some money for awhile or to full out cash flow? If you are looking for great cash flow, you will have to pay upfront. 

Hope this helps.