The Log House at Sugarloaf - Vacation rental cash cow

[Stewart Wyne]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $1,100,000
Cash invested: $250,000

This luxury custom log home is a 6BR 6 bath, off-grid eco solar home and is 90% self sufficient. It features high end finishes, a large chef's kitchen, grand room with vaulted ceilings, and game room for entertainment. 

The home is located at the base of Sugarloaf Mountain in Dickerson MD and is available for rent on Airbnb and VRBO. 

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

My long history of success in vacation rentals. But more specifically I saw other homes being rented for high prices in the area, and noticed a lack of options for a rental such as this in the area.
This deal was extremely speculative, as there was nothing like it in the area to compare it to. People told me I was crazy. But my 200k cash investment has resulted in 100k yearly cash flow. And I generated $400k in equity on day 1. So I'm happy with the result.

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

I built this property on land I bought from my grandfather.

How did you finance this deal?

Traditional residential development mortgage (secondary residence)

How did you add value to the deal?

I built this property from the ground up. This development project took about 3 years, from planning to our grand opening.

What was the outcome?

100k per year in cash flow. $400k in equity.

Lessons learned? Challenges?

Construction costs ballooned way over budget due to customization.

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

Terri Sherwood with Sugarloaf Contracting did most of the custom finishes, including the kitchen. Highly recommend her.