Out-of-State Nightly Rental

[Molly Edwards]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $105,000
Cash invested: $24,000

Nighty rental in small town Missouri.

What made you interested in investing in this type of deal?

I already owned an apartment building in this same city and wanted a place I could stay when I am in town. I wanted another property for cash flow.

How did you find this deal and how did you negotiate it?

I found the deal on Zillow listed for-sale-by-owner. I made contact with the home owner and built report over about a 4 week period. Eventually the trust was built to negotiate a good deal on this purchase.

How did you finance this deal?

Conventional financing, 20% down.

How did you add value to the deal?

Cosmetic upgrades, professional photography, addressed small structural concerns.

What was the outcome?

I cash flow about $800/month. I feel like this is a good ROI as it gives me a place to stay for free while also bringing in money.

Lessons learned? Challenges?

With a nightly rental, your cleaner will be your biggest asset or detriment. Make sure you vet your cleaner well and check up on their work! Treat them well and compensate accordingly as they will make or break your success.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I worked with a lender that is licensed in multiple states which is important as I made this purchase from 2,000 miles away.