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Thoughts on Canyon Lake, TX
I recently posed this same question regarding Lake LBJ & Lago Vista, but I was wondering if anyone has any experience with STRs in Canyon Lake, TX? I only have long term rentals and am looking at investing in a lake house to use myself a couple times a year, but to rent the rest of the time. So my questions are:
- What are the annual occupancy rates? Good or bad relative to other nearby
- What means to you use to come up with your nightly rates?
- Anyone using Evolve Vacation Rental management or other companies? TurnKey? Vacasa?
- What's your ROI? This number seems to be somewhat tricky to nail down.
- Are there better or worse areas to invest or watch out for, for whatever reason?
- Any tips or tricks?
Thanks for any and all advice and have a great week!
Hi William - I have one STR in Canyon Lake. It isn't lakefront but its close to public ramps/parks and Whitewater. My experience has been that summers are very busy but it falls off the rest of the year. I have 4 months or so where the revenue is 6X the monthly revenue during the rest of the year. I use Vacasa and the experience has been mostly positive. They are expensive (30% fee) but they cover 100% of all management responsibilities. Another positive with Vacasa is that they come up with suggested rental rates based on their software. I have another STR further down Guadalupe River near Lake McQueeney that does a bit better.
Thanks for the info. Does your Canyon Lake property have a view of the water? From what I've gathered that's paramount for a house on a lake to do well. Do you personally manage the STR near Lake McQueeny? Why does it do better? Have you worked with any other mgmt company? Or have you managed an STR yourself and what advice can you give if so? How did you setup cleaning?
@William Brock We looked at a variety of properties around Canyon Lake two years ago for STRs. However MOST of the properties we found near the lake were in HOA neighborhoods that disallowed STRs. So make sure to keep an eye out for that.
@Mark S. Thanks for the advice and I agree. I've have my agent make sure each property allows STR. Did you end up buying an properties there? Any other STRs somewhere else?
Most people I have spoken to about Canyon Lake agree views of water are important in deciding value/ rents. There are certain HOA's which do not allow STR's, however there are some that do.
Time of year, holidays, season, etc. do effect your occupancy rate. Of the AirBnB's in Canyon Lake I reviewed, not many of them were booked right now. Summer/ hotter months will for sure be your better revenue months.
@William Brock We bought in Wimberley on an unrestricted 10 acres. I think we exchanged a few notes about this a month or two ago
@Brandon Miller Thanks for the info! Yeah with the fluctuating occupancy rates, I'm finding it harder to run numbers than on a long-term rental with a consistent monthly rent.
@Mark S. That's right, we did indeed talk about that! Thanks again for the Canyon Lake advice.
@William Brock Yep it does have a pretty nice lake view and I would agree that is a nice perk for a STR in the area. I have only used Vacasa as a management company and due to my day job I haven't managed an STR myself. Vacasa coordinates the cleaning as part of their management service but the cleaning costs are passed along to the guests.
It's total speculation but I think the McQueeny property does better since it is closer to the more populated areas. Canyon Lake is a bit further out.
@Michael Smith When you say "cleaning costs are passed along to the guests" how exactly does that work? Are you saying the cost is taken out of the collected rent before you get your payout? Or is there literally a visible cost the guest sees called "cleaning fee" or something similar? I'm pretty sure it's the first, but just want to make sure because I've heard multiple people word it the way you did and just want to make sure my understanding is correct. Thanks.
@William Brock It's this one: "Or is there literally a visible cost the guest sees called "cleaning fee" or something similar?"
The guests are given a separate cleaning fee charge that is a visible cost to them.
@William Brock I can't say specifically how well these do, but we have lent on numerous VRBO type properties on Canyon Lake recently, and those borrowers seem to be doing well, so other investors are doing just what you're talking about, for what it's worth
@Jason Hirko Glad to hear there's some action down there! The nicer of the properties that I watch on the different MLS sites seem to be snagged up fairly quickly (couple weeks max) so I know there's a desire to be there :)
Hey @Seth Elliott, no stupid questions! I think they're referring to Short Term Rentals (airbnbs, VRBOs, and such).
I'm interested in Canyon Lake myself and following this chat. Moved down to San Antonio from NYC over the Labor Day Weekend (continue to manage a modest portfolio in upstate NY) and hope to get the ball rolling down here. Thanks for the all those contributing to the Texas-related posts I've been following.
@Seth Elliott Yep, what Thomas said is correct, STR is short for short-term rental. Same as vacation rental.
@Thomas Wurfel How are you liking San Antonio so far? I bet it's a big change from NY. Yeah so as you've read I'm interested in Canyon Lake. It's perfectly located between Austin and San Antonio. San Marcos, which isn't far from there at all, is home to Texas State University, as well as a recreational destination for the river tubing, which is a huge attraction. My wife and I and multiple other couples go every year, and we know people who float more often then that. Canyon Lake also has a much slower paced feel then some of the other lakes I looked at (Lake LBJ, Lake Travis), and is not nearly as built up and commercialized as those. There's nothing wrong with that though if that's what you're after, because there are some amazingly beautiful properties on those lakes, but you pay the tax premium for it too. Canyon Lake's taxes are really low in my opinion relative to other parts in central Texas.
UPDATE: I'm under contract on a home in Canyon Lake!! Once the wife and I saw the property, we knew we had to go take a look, and we're really glad we did. We put in an offer a week ago and the inspection just came back good with minimal items pointed out that we're requesting to be fixed. But overall, the house is in great condition! We love the view (the pictures don't do it justice) and the wrap around deck. Take a look and let me know what you think: https://www.har.com/1291-springwater/sale_SABORTX-1335953
Congrats @William Brock ! I passed this property online last week and it definitely caught my eye. Crazy to think you were asking about STRs/starting this forum up not even 3 weeks ago and here you go...
Would love to hear more about your plans with this as you move forward!
@Thomas Wurfel Thanks! Yeah I definitely moved quickly on getting this property and my first STR. I knew it was something I've been thinking about and as I started looking into it more and more it seemed like a good move for my REI plans. I'll definitely post more on it as it progresses.
I am exploring STR market and like to understand...
- How is ROI of STR compare to investing in SFH in high demand area?
- How is appreciation of STR properties?
- Is there any Tax benefits?
- Better to invest in SFH with yearly lease and just rent STR when needed for personal use instead of involving in owning and extra management of STR. I think if owner planning to use few month every year, then definitely is big advantage.
Thanks guys, I have never seen that abbreviation before. My experience is in Construction, specifically Multi-Family so I’m new to Vacation Rentals.
Hi @William Brock, I am interested in the Canyon Lake area for STR and stumbled on your thread. How is the STR you purchased a few years back doing? Do you mind sharing any insights or experiences?
So, looking at my airbnb numbers, (which is the only online service I use for the time being), I was booked 61% for 2019. I have talked to others in the area and it really is hit or miss, but good management and a professional listing really seems to make the difference. That being said, I seem to be doing better than most.
I had a couple large ticket items to fix last year that really ate into my profits, but I still ended up positive and with a great retreat from the city that pays for itself. This year our rents are higher than last year and we're booking like crazy, probably going to be closer to 70% occupancy, all due to 130+ reviews and sitting at 4.89/5 rating and a SuperHost badge (those things matter) as of 2 months ago, I have even more ratings now. But, I am expecting a much better year than last if I can keep the maintenance costs down. Last year was around only a 5% ROI after all the issues I went through. This year I'm hoping realistically for 20%+ ROI. It's been a learning process but worth it in the end. Ask me in a couple years and who knows how I'll feel lol.
Dealing with that many different people who are renting the property can be exhausting at times, but putting good systems in place really helps alleviate most extra work and stress. I can't stress enough that getting good systems in place is the key to success. After this year I should have a better grasp on how the property will probably perform going forward.