STRs in residential areas: Another viewpoint

[Collin Hays]

It seems there is a fair amount of angst against municipalities and other local governments due to their often-hawkish treatment of short-term rentals. They are the bad guys for banning STRs or severely limiting them.  

This week, I had breakfast with an old friend of mine who is a detective at the local police department. He works in a department that investigates houses in the city that appear to be distributing drugs, sponsoring prostitution, or human trafficking. As it turns out, he said many of these houses are "airbnbs". I asked him if it would make his job easier if the city banned these, and he said "absolutely, but no one is going to do that."   

I am not so sure.  Regardless, we as investors view our rentals with a hearty dose of naivety, or perhaps indifference:  Just nice places for good people to overnight or attend a family reunion. But in areas that are clearly intended for residential, these rentals also present an optimum place for criminals to set up shop in relative anonymity to do their thing: Smack in the middle of a quiet neighborhood.  

[Brett Synicky]

Quote from @John Underwood:

Another reason to focus on vacation rentals. Not the inner-city HOA property.

I buy places that I can take my family to on vacation and make memories.

I see people buying properties for a STR that only make 12k or less. I can buy a LTR for cash that I can make for than that per year with much less work.

I just bought a house at auction that I paid 32k for that will easily rent for $1500/month. I'll rehab it and have than $50k in it and rent it. Then I will only have taxes and insurance to pay each year. It will pay for itself in 3 years.

Best of all I'll never pay any tax on this income because my ROTH IRA owns the house.

 Love it! The power of the Roth combined with alt assets like real estate is 2nd to none!