how to price a multi unit at the beach

[Andre Farah]

I have the occasion of purchasing a multi unit at the beach, it is 3 unit with 1 bedroom and 1 bath each and an "owner" apartment with 3-4 bedrooms on one level with water views.

the rentals are $ 650 x2 and 1 x $700.

on the owner unit I figured around $ 1500 per month ( September thru May ) and $ 1500/week from June 24th to August 30th.

based on the numbers given above I figured a starting bid of $395,000, does anybody agree with this starting bid?

[Kristopher K.]

Hi @Andre Farah,

Depending on where you are you need to also look at insurance - mainly flood, also occupancy rates may vary and the market might be much different year round vs seasonals. There are also shoulder seasons to consider.

@Devin Beverage brings up some good points, and honestly I think there needs to be more info here before you can tell if this is go/no-go. What are your goals, self managing, marketing, using?

Utilities can vary, insurance can vary, rates and occupancy will vary. I've seen PM rates from 10-15% to 40% and they provide different services. Are you furnishing? What are the taxes? Do you need linen service, cable, and wifi?

You get the picture. Search BP for vacation rentals and tighten up your numbers a bit. I know in my market I would be hard pressed to start at that number for 3 units, with that mix if I were looking for cashflow.

Hope that helps a little.

Kris