Finally Joining Bigger Pockets Forum!

[Connor Guinn]

Hi All,

My name is Connor Guinn, I am a 25 years old. I grew up in the Spokane, WA/Coeur d'Alene, ID area, which I will be moving back to shortly. I currently own a home in Hopkins, MN with a small detached Airbnb unit on site as well. I have listened to the BP podcast for quite some time, and I am joining the forums today because I have a question I want to get some insight on. 

As mentioned I own a house in Minnesota, and I am planning on moving back to my home town (Spokane/Coeur d'Alene) just before Christmas this year. I am trying to determine whether to hold or sell my property. Without the Airbnb revenues, the property has a negative cash flow (numbers are below), however with the airbnb producing income the cashflow is pretty substantial. Given the situation I am looking for some advice and insight as to what others would consider doing. Do you consider short term rental income in the cashflow equation or do you avoid that due to its volatility? Maybe some of the pros and cons of hold vs sell? Should I consider the fact that PMI will go away in a few years and help improve the numbers? Any advice or insight would be great! Thank y'all in advance!

Purchase Price: $287,000

Renovations: $40,000 (5-yr loan)

ARV: $350,000-375,000 (accounting for the fact that it is not a great time to sell)

Mortgage Payment (P&I, taxes, insurance, PMI included, 30yr fixed): $1,910

If I rent:

Costs (Maintenance, vacancy, management fees, mortgage, renovation loan): $2,910

Estimated Primary Rental Income: $2,200-$2,400

AirBnB: Averaged $1,300/mo (October & November)

Summary: 

With PMI and Renovation loan payment

Net cashflow without airbnb: -$710 or -$510

Net cashflow with airbnb: $590 

After PMI and Reno loan are gone:

Net cashflow without airbnb: -$230 or break even

Net cashflow with airbnb: $1070