Seaside, OR · Member since 2017 · 32 posts · 13 votes
Am I able to list my vacation rental property that grosses $100,000 annually as a commercial property? I net somewhere near $60,000. What would be a good cap rate to put on it that would attract some real estate investors?
@Amanda M Laird you could try selling it as a "vacation rental business" to a local property management company. They might be willing to pay a little over market rate since you have proof of rental income.
Why sell a property that nets 60 grand??
I would just have your agent put this info in the listing.
You can’t sell it based on how much money it makes like an apartment building. It’ll never appraise
Is your property located in Seaside, Oregon or somewhere else? I can connect you with someone who can help if I know where it’s located. There are agents selling properties (typically interpreted as a residential transaction) with the short term rental business attached (typically a commercial transaction). It’s new but there’s an obvious need for this type of deal and there are lenders that will work with it given proper information.
@Amanda M Laird you could try selling it as a "vacation rental business" to a local property management company. They might be willing to pay a little over market rate since you have proof of rental income.
I have a similar situation that I was hoping to get some advice on. I recently bought a home in the Hudson Valley, NY. I've only owned it 4 months. I put a some money into making it more desirable as a vacation rental via (airbnb, vrbo...etc) with the plan of holding it as an investment long term. It's been rentable for 2.5 out of the 4 months I've owned it with 60% occupancy and monthly cash flow of ~$6,000.
My plans have been forced to change due to some family needs and I am now thinking of selling it. I wanted to know if I could sell at a premium to an investor/management company. I'm aware that 4 months is probably not enough time to signal consistent rental revenue for a potential investor to justify a multiplier, however I still wanted to evaluate the possibility and seeing if I could sell it.
I'd love to hear from the community if its recommended to bring the property to market, or if I should hold for a longer period of time. Thanks!
@Marc Ende, if you put work in, it may get a premium from a homebuyer. An investor will only judge the property by its cash-flow potential. End users usually pay a premium for SFH's.
The only way to find out what it's worth is by putting it on the market or get a broker's opinion of value.