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Updated about 2 years ago on . Most recent reply
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Vacation Rental Buy & Hold via 1031 exchange
Investment Info:
Condo buy & hold investment.
Purchase price: $330,000
Cash invested: $95,000
This one bedroom condo sits on the shores of Orange Beach, AL with front row views of the Gulf of Mexico. I rent this property out as a vacation rental, but do visit from time to time with family and friends. This purchase was a result of a multi-family unit I flipped and then did a 1031 exchange into this beauty. One of the best real estate moves I have made to-date.
What made you interested in investing in this type of deal?
I wanted to start getting into vacation rentals and did research on different areas. I decided on starting with a beach condo in Orange Beach, AL.
How did you find this deal and how did you negotiate it?
I honestly looked off Zillow and reached out to a local real estate agent in Orange Beach. Since I have my real estate license I was able to negotiate a referral fee and receive some funds back at closing.
How did you finance this deal?
I took out a conventional loan, using a 1031 exchange to fund the down payment of the property.
How did you add value to the deal?
I hired a property manager and placed it on all the top vacation rental sites. During the off-season of 2022, I changed the cabinet faces, replaced the ceiling light over the table and replaced the outdated curtains with nice blinds.
What was the outcome?
I love the space and I bring in on average $3500/ month in rents. For 2023 I am going to work with my property management company to more aggressively market to the Snow Bird rental population during the off-season.
Lessons learned? Challenges?
I believe I can bump up my monthly average by keeping the unit booked during the off-season. I didn't have a plan for that in 2022, but am targeting to be more aggressive in 2023.
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