First Short Term Rental

[Jhosdyn Barragan]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $420,000
Cash invested: $30,000

Purchased an existing short term rental that had been almost entirely renovated, but still had some areas we could improve. Completely remodeled the primary bathroom as well as upgrading all furniture and improving hot tub and fireplace amenities. Spent around 30K in materials and labor. With current interest rates, we will break even on the investment until able to refinance for improved cashflow; however, the area (Massanutten Resort) is great for appreciation and the tax savings are excellent on my W2 as we are self managing. The experience has been an entry in a new form of REI for myself that I look to continue to expand in (luxury STR).

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

Dipping my toes into the world of STR in hopes of greater free cash flow

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

Found on MLS, made a strong offer at asking price with no contingencies as the home fit all our criteria. Had it under contract 2 days after it went live on the MLS

How did you finance this deal?

Second home loan

How did you add value to the deal?

Improved the only last areas of the home that where not newly renovated for a complete "luxury" feel to the STR. Improved all the furnishings and decor.

What was the outcome?

It has gotten steady bookings. Breaking even in its first month. Will look to increase occupancy as good reviews come in and eventually by refinancing the home at a lower rate.

Lessons learned? Challenges?

Managing the renovation from two hours away and building a team from scratch was a lot of work.

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

Monica Snow was our agent and helped us during the deal.