Investor · Long Beach, CA · Member since 2021 · 26 posts · 2 votes
Hey BP crew! I'd love to get an idea of what the SoCal investment market is like and what people are looking for. With a huge sellers market and restrictions/guidelines with COVID constantly changing, what kind of properties and investment strategies you are working on or on the lookout for? What trends are you seeing currently or on the rise for the future? What's has or hasn't been working for you? Hopefully with people sharing their project situations, needs and wants, we can build resources and help each other with their goals!
We have a rental in the Orange County area. We've had 0% vacancy since we've owned it (2016) even with multiple tenants passing through. When our long term tenant moved out December of 2020, we had trouble filling it for the first time ever. So we converted it to a long term short term rental (30 day+ on Airbnb). We're on our second guest (2-months a piece). It's a lot more work, and the income is a little more, but less consistent (there are weeks between guests at times that aren't covered, or technically they are but our income goes down to cover the spaces between guests). And the costs to furnish were more than expected, even with smart buying (used items, lots of IKEA, borrowing pieces, etc.). We're going to wait and see if we get another guest books for May. If not we'll turn it back to a standard rental, and hopefully we'll find a qualified tenant now that a lot of the chaos of the pandemic has settled.
Specialist · Los Angeles, CA · Member since 2018 · 291 posts · 231 votes
5y
@Jennifer Buchanan I have STR's in Big Bear and also manage for others and we are having insanely good numbers for literally everything. Long term I believe in STR's in true vacation markets you don't give up control of the property in the same way you do for long term tenants and we have been making 3-8 times as much revenue as What the market LTR is.
Investor · Long Beach, CA · Member since 2021 · 26 posts · 2 votes
5y
@Christine Smith thanks for sharing! That's good to hear that your rental is still profitable. The trouble finding a tenant could be due to the eviction moratorium that is forever extending so there's not much tenant movement but it sounds like you're making the right moves/adjustments to compensate. Why did you choose a rental in OC and are you thinking about expanding to other areas?
Investor · Long Beach, CA · Member since 2021 · 26 posts · 2 votes
5y
@Zachary Beach Thanks for your input on STRs in vacation markets! I've been seeing/hearing a lot of buzz about Big Bear lately. I imagine the Winter/Summer seasons are busy but how are Spring/Fall? Are you able to stay occupied year round or does the busy season create enough cashflow to cover vacancies? Are there other vacation areas you're looking into that are on the rise?
Specialist · Los Angeles, CA · Member since 2018 · 291 posts · 231 votes
5y
@Jennifer Buchanan we have positive cashflow year round and keep 90%+ occupancy in the slow months even before COVID and there haven't really been show months since COVID. Are occupying and profits are more about managing including being optimized in the algorithm and having the best dynamic pricing around. STR's are like most businesses the best do very well the average doesn't make much or any money and going out of business in 5 years or less.