Investing in STR in Maui

[Jennifer Creager]

We are purchasing a STR in Maui. I had wanted to start small, a 1 bed/1 bath, but the analysis showed they didn't cash flow very well at the purchase price. We put in a low ball offer on a 2 bed/2 bath, and it was accepted! It will cash flow nicely, and I am excited to self manage.

On a whim, I did an analysis on a 1.9M house on Maui that is in the STR zone. Using average numbers from VRBO, this would start cash flowing after renting it for just 7 days. For the first investment, I didn't want to risk that big of a purchase. My question is: is it a rule of thumb that the bigger the place, the higher the cash flow? I'm including the mortgage costs, which are higher with the higher purchase price, but I wanted to get other perspectives for a future purchase down the road.