Any Park City Vacation Rental Investors?

[Rohin Dhar]

Hi All, I was wondering if anyone out there had seen success as an STR investor in Park City, Utah?

A lot of the older posts in the forum indicated to stay away from the market because of the long off-seasons with low demand.

Specifically I'm evaluating the small condo (studio or one bedroom) market at entry level price (<$300K) near town or prospector square. Wondering if anyone has any thoughts on the prospects of cash flowing for these kinds of properties?

[John Underwood]

Has the weather changed there to change the off season duration?

In town STR's have suffered the most during Covid. This sounds like strike 2. Add low demand from your research and this does not sound good at all.

[Rohin Dhar]

From most of the older threads, it seems like self-management hadn't really caught on yet (people paying 40% PM commissions) and the STR market wasn't quite as big as it is today (growth of Airbnb).

I believe COVID has increased demand in mountain towns this summer. However, if the sky resorts don't open, could be a pretty brutal winter there in terms of bookings which is the main season.

However, shoulder seasons really kill the economics of these mountain towns I suspect unless the purchase price is quite low. We love Lake Tahoe and live a few hours away but never managed to figure out how to make the numbers work!

[Steele Dewald]

@Rohin Dhar I manage 6 investment properties and own 3 of them.  It can be very profitable if done the right way.  Message me, I am happy to share my rental numbers with you and give you a heads up on what to watch for.

Steele

[Wes Walker]

I had replied in the previous thread, but can say post-COVID the landscape has shifted somewhat significantly.

Upsides:

Increased amount of long-term rents and renters (I.e. lower property mgmt fees, less utility bills)

Less and less of a shoulder season with more consistent yearly short-term renters.

Downside:

Rent increases, while higher, have not kept pace with increased sale prices.

I’m an agent in town as well as an investor.  Feel free to reach me anytime.

[Alex S.]

@Rohin Dhar I love Park City...but I just couldn't ever make the numbers work there. Good luck anyway!

[Joey Morea]

@Rohin Dhar

I would love to buy a place in park city and would in a minute if the math worked but I looked at the numbers and the cost to buy 500-600K and that only probably gets you 1br vs the rent seemed terrible like 30-40k gross a year. Makes more sense for me to just get another one in Florida or the smokies.

[Rohin Dhar]

This original post was 11 months ago, but since some folks tagged me on it recently, here's my update. I ended up passing on Park City at the time because it didn't seem to have the occupancy rates I needed to make my strategy work. In the shoulder season, some of the nightly rates on condos were really quite low and still had low occupancy. Things could have changed since then, but I haven't really followed it.

Prices went up a ton since then though so Park City might fit someone else's strategy!

[Alex S.]

Always love to hear updates, thanks!

[Ryan Moyer]

I live about 45 mins from Park City.  I'm typing this from Park City right now on a little long weekend away we spent here with the family mountain biking and enjoying good food.

I love Park City.  I wanted to own a place here.  But like the others I just couldn't make the numbers work.  Granted I haven't checked again since the covid boom so I'm sure places are renting better now, but the already insane real estate prices have gotten even crazier along with it.

I could buy a 3br condo here for $1.8m that probably does $80k in gross revenue.  Or I could spend $1.8m in a better market and make triple that, and vacation here as much as I want.

[Steele Dewald]

@Ryan Moyer Rents have moved with the prices. We have seen record numbers this summer and in our future bookings this winter. Our winter reservations thus far are up 30% over last winter (which was a record winter for revenue). Don't give up yet.

[Ryan Moyer]

Originally posted by @Steele Dewald:

@Ryan Moyer Rents have moved with the prices. We have seen record numbers this summer and in our future bookings this winter. Our winter reservations thus far are up 30% over last winter (which was a record winter for revenue). Don't give up yet.

 Hey sorry just saw this.  I'm shooting you a PM.

[Mike Anderson]

My in laws live in Park City, (actually just outside in hideout) we looked into it pretty heavily and it's really hard to make the numbers work up there in my opinion. 

[Jonathan Mueller]

I love it when Park City posts come back up! For reference I own a duplex in Park City, I have rented it both long term and nightly with great success on both strategies. My 4 bedroom unit currently rents for $5,000 and they are on a year lease. My 2 bedroom unit could rent for $2500 on a monthly basis. While its an expensive place to buy and cash flow numbers could be better in other places. Thats not my end all consideration. Park City is a growing recreational town where a ton of people want to live and vacation, because of that we gets more appreciation than a lot of other places and the other huge factor for me is that its a place that I want to spend a lot of time. We will probably move into the 4 bedroom house in a year or two. If you are solely a cash flow investor, than stay away from Park City. If you are looking for an investment with growth potential and a place to visit and want to write off some travel, then Park City could be an excellent option. 

CAUTION: I am a realtor so this could just be a good sales pitch ;)

@Rohin Dhar I remember we talked a few times a while back about you investing in PC, things have gone wild since then but who would have known that would be the outcome with Covid

@Alex S. @John Underwood @Joey Morea