Looking for advice to either continue my STR or sell

[Jacob Lockard]

Hello everyone,
Here are some details about my situation. I bought the house in December 2022 to start a short term rental. It's an owner occupy situation, where I live in the home and rent the other 3 rooms on Airbnb as well as Peerspace. It's done ok in 2023 at $34.6k, however, I'm planning to move out of the house for June/July of this year and will need to make a decision. I will need to either rent the entire home as a short/mid term rental or sell the house. Additionally, I am aware that once I move out, I can list the home on VRBO and several other platforms to help boost bookings.

The reason why I'm considering/leaning toward selling the house, is that when I begin to run the numbers, the expenses exceed what I could potentially make. According to AirDNA, the projected revenue would be $82.7k. And obviously, this figure is not guaranteed. Once I was able to break down the expenses, I would need to bring in something closer to $120k to make it worthwhile. I know that I could save some money by continuing to manage the property on my own, however, I have concerns about being out of state and not having eyes on the state of the home (leaks, damages, etc.) and of course, parties. My home is a magnet for people who want to party, as it's 3500 sq ft and has a history of parties from the previous owner's management experience.

I'm looking for some input and advice on what my best option might be. Long term wouldn't work for me currently, as the going rental rate for my house would be under what my current mortgage is. If rates fall later this year as forecasted, it could be worth factoring in the possibility to refinance and bring my mortgage down low enough to continue renting it as a short term rental or consider renting it mid or long term. I'm happy to hear any creative ideas around what you might do in my situation. I'm sure there are things I'm not considering and would appreciate your feedback.

Here are some additional details about the home and financial situation.

Location: Atlanta, Georgia
Mortgage: $5513/mo @6% interest
Zillow Rental Estimate: $4966
Current Mortgage Balance: $716k
Zillow Home Value Estimate: $825-1.02m

AirDNA Information:Projected Revenue: $82.7k
Average nightly rate (as entire home): $347
Occupancy: 65%

Projected Operating Expenses: $41k
Management Fee: 20% - $16500
Lodging Tax: 5% - $4134
Property Tax: (included in mortgage escrow)
Cleaning Fees: $6600
Maintenance: $3400
Insurance: $5200
Utilities: $5172

Projected Monthly Income: $6891 - $5513 = $1378
Projected Expenses: $3416 /mo
After Expenses: -$2038 / mo

Here are my listings:
https://www.airbnb.com/rooms/796636182229405398?guests=1&...
https://www.airbnb.com/rooms/842278641447927875?guests=1&...
https://www.airbnb.com/rooms/847341496880342421?check_in=202...

[Michael Baum]

Hey @Jacob Lockard, so I am not a fan of getting rid of properties, but in this case it seems like the way to go.

You have lived in the place for 2 of the last 5 years I assume? If so, then it should be a tax free sale. You can then put that towards you new place or another property in your new area.

You can also look at the new FHA 5% down loan for your next place. You can get up to a 4 plex. Live in one and rent the others. Might be a nice change to not have people roaming around your house.

I have read that it can be a chore to get through the rigamarole, especially around the revenue stuff. 3 and 4 plexs are supposed to be hard, but I haven't checked so run it down.