Help Me Evaluate This STR Deal

[Bob Mueller Jr.]

Have found a STR property in Florida that has a good history on VRBO and AirBnb since late 2015 until now. Seller has provided me with booking/revenue numbers going back to 2016, and is claiming the property was booked 316-324/365 days in 2016/2017. He is showing 283/365 so far in 2018. These occupancy numbers seem extremely high to me, but I have verified the property is pretty booked up on VRBO so maybe it's true. The cost of the house would be $500-600K to obtain, so it's not cheap. His numbers claim a NOI of $53,734 before any debt service, with a $500 monthly cleaning fee (average) and self managed. Or I get an NOI of $40,954 if I input 20% for property management. For both those calculations, I put 5% towards budgeted repairs and 3% to CapEx. With the 20% management and NOI of $40,954, I am still getting roughly $1,100/month positive cash flow, 10.14% COC return, assuming a $575K sale price and 20% down ($115K). Is this a risky deal? If I take away the 20% PM, the numbers jump to $2,150 monthly cash flow and 20.13% COC ROI.

A lot of numbers to digest here, but can any of you STR veterans help me out? @Luke Carl ? Is anything jumping out to you?  They rent the property for around $350/night average.  I think my biggest worry is if the extreme high occupancy drops for whatever reason, then this property comes into trouble pretty quick...  This would be my first vacation property.      

Annual Rent
Rent Rev. Mo.	$7,824.83	$93,897.98
Costs
Taxes	$518.25	$6218.98 paid yearly
Insurance	$371.70
Average Bills
Power	$600.00	Duke Energy
Water	$200.00	$400 every 2 months Pinellas County Water
Cable	$125.69	DirecTV
Internet	$58.28	Brighthouse
Lawn	$135.00
Pool	$180.00
Garbage	$17.16	$51.48 paid quarterly
Cleaning	$500.00	average
Total Costs	$2,706.08
Gross Profit	$5,118.75

[John D.]

$94k gross rents on a $575k purchase is 16% rent/purchase ratio.  We target 25-30% for these larger properties, but would take less for something like this that is turnkey I suppose.  The biggest flag I am seeing is cleaning.  With that occupancy, cleaning should be a lot higher.  How much does it cost to clean the place, and how many turns do they average per month?  Cleaning should be WAY higher.

It's probably worth putting CAPEX, maintenance, and furniture and fixtures replacement into the equation. With a larger home with a pool, full of furniture, plan on significant costs to repair and replace.