STR in the mountains of Idaho

[Mckinsey Swain]

Investment Info:

Single-family residence buy & hold investment in Garden Valley.

Purchase price: $335,000
Cash invested: $38,000

This is a cabin we are building to use as a short term rental. Estimated completion date is November 2021. Cash flow is a low estimate based on comps in the area.

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

I am building my portfolio with short term rentals because of the high return in my area

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

I found the lot under market, purchased it with cash and financed the build with a builder that allowed some sweat equity. We will have instant equity of approx 200K once the project is complete. We are not doing any construction ourselves, only administrative work like pulling permits, etc in order to fulfil our sweat equity duties.

How did you finance this deal?

We paid cash for the lot and financed the build with a 20% down construction loan. Because we bought the land under market, they appraised it for over double what we paid, thus satisfying the 20% down. So we did not have to put down any more cash for the build.

How did you add value to the deal?

We bought the lot under market and used a builder that would allow us to do some sweat equity.

What was the outcome?

Construction will be complete in November of 2021 and we will rent out as a short term, nightly rental and cash flow approximately 2K/month conservatively.

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

I am a Realtor, so I managed the deal myself. I would DEFINITELY suggest using an investor friendly Agent for a deal like this, I was able to save a ton of money by having connections of an off market lot and a builder I knew could build it for a price to make our margins work.