Air BnB Strategy - Lake Tahoe

[Ryan Ebzery]

Hello, 

I live in the Bay Area and vacation in Lake Tahoe often. My fiancee and I are looking at potentially purchasing a vacation home/condo, and I'm curious if this is something I can turn into a profitable investment. Is anybody local to the area and having any success profiting with short term vacation rentals?

If you are not local to the area, I would still be interested in hearing your thoughts on the STR market and your thought process/approach to analyzing these types of deals.

Thanks!

Ryan

[Melissa Wesling]

My advice is to research the rental regulations in the area.  I believe there are some strict rental ordinances, especially in South Lake Tahoe.  The rental market overall has been a rollercoaster due to Covid restrictions, but research has recently found that bookings on OTAs have recovered to 81% of 2019 levels.  Depending on the location, some rural areas are seeing a more active rental season this year than last.  I self manage my STRs in southwest Michigan, which is usually a summer rental season, but we are on track to have our busiest fall season in 12 years!  

As for analyzing deals, first decide what your investment goals are.  Here are some things to think about: It sounds like you want to buy in an area you like to vacation in.  If that's your dream, then is it okay if your investment breaks even and you accrue equity?  Are you seeking a particular return on your investment? Do you want to diversify your portfolio with a home that will appreciate in value? Are you looking for an investment vehicle that offers tax advantages?  Best of luck!