First Short Term Rental Property

[Mike Carroll]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $263,000
Cash invested: $100,000

This is my first investment property located in a seasonal beach town. I built a 5 bed, 5 bath module home on pilings with a heated pool.

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

The land dropped in price almost 30k, so I figured I should jump on it. The location is perfect being in a seasonal town but just outside the incorporated town limits. It has a great water view of a nice pond with a private dock.

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

My parents actually live down the street from the property, so I kept an eye on it. Then after purchasing the land, I hired my dad to be the contractor and we did all the contracting together.

How did you finance this deal?

Traditional construction loan.

How did you add value to the deal?

By building a large beach house people can vacation at one week at a time.

What was the outcome?

I am gearing up for my first rental season starting in late may. It is mid march and I have 3 confirmed bookings so far.

Lessons learned? Challenges?

Contracting your own project is NOT easy. This is my why contractors charge what they do. When you aren't an established contractor, it seems the only sub-contractors you can get charge way too much or they are the low hanging fruit and do shotty work. When I do this again, I am not sure if I will hire a contractor or do it again myself. All in all doing it myself was a good investment but it was a LOT of work. Also, add 20% to what you think will be your budget!

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

Hayden Evans from TD Bank did my construction and eventually home mortgage loan.