Short Term Rental or Duplex

[Peter Drumm]

I am going to buy a property that will need a full Rehab. This will be my very first rental property and am trying to decide the best way to rent. So here are the specifics and maybe someone could give me some feedback and point me in the right direction.

Because of its location is why I am leaning towards doing a short term rental. It sits directly across the road from the public boat ramp (by the way it is on Cedar Creek Lake in Gun Barrel City), 1 block from the gas station that sells Ethanol free gas which boaters use, and close to the waterfront restaurant people enjoy frequenting during the summer.  It also has 2 additional lots attached to it that would be perfect for creating an outdoor fire pit area and possibly a sand volleyball court.

However, here is the dilemma, when I inspected this house I discovered immediately that it was designed to be a duplex. The bottom unit is a 2 bedroom 1 bath with laundry attachments and a kitchen. The upstairs is a 2 or 3 bedroom with kitchen and bathroom but no master bedroom. Also, there is a fun bonus room where they converted the attic space into a fully functional upstairs area. 

Now, this will have to be a full remodel from the floors to ceilings, both bathrooms, adding kitchen fixtures and cabinets. I like having a blank canvass to work with because it will allow me to completely create this living space from scratch.

Option 1: Set it up to be a duplex and do not bother with decorating the living spaces and try to keep my costs down by not installing any expensive features.

Option 2: Set it up as an AirBnB as 2 units to rent out, allowing me to rent it as a duplex but AirBnB style.

Option 3: Set it up for AirBnB but as a single family home and utilize the spaces that would have been used for kitchen and laundry rooms and now have bigger rooms such as a master bedroom or an extra living space that i can put a game room in.  Keep in mind I will be doing 80% of this work myself over the next year or so allowing me the opportunity to get more acquainted with rehabbing a property myself and boost my confidence in undertaking the next big project.

Thanks for any advice, been listening to Bigger Pockets for over a year now and excited to take my first big leap!