All Forum Posts by: Bernie Cesareo

Bailey, Are you still considering this, I am currently considering this strategy myself...and would love to discuss with you!

Pleasure meeting you virtually!

Hi Bonnie...thanks for tagging me here....Yes I am managing MTR's as well as STR's...We have been doing MTR's for about 4 years. We are specializing in larger and more luxurious properties and have been generating some great returns for Our owned properties as well as investor-owned properties. I will circle back to find the posts for people looing!

Good insight.....I have been waiting for the right time......now that the  market looks like it is peaking, I am pulling out equity for another project!

Investment Info:

Single-family residence other investment.

Purchase price: $55,000
Cash invested: $37,000

Was used as a Long term rental for 13 years, Now being used as a Short term rental since 2019:
Here are some other short term rentals I have....
https://bidcoshorttermrentals.guestybookings.com/

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

Mike Sjogren STR Secrets MasterClass
https://www.strsecrets.com/

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

Originally through a realtor I had a relationship with......the deal fell apart with the previous buyer....he clled me on it and we did the deal in a couple of days!.....closed within a month!

How did you finance this deal?

BRRRR but before it was called BRRRR lol!.....Bought cash, rehabbed, rented then refinanced!
Almost paid off now!

How did you add value to the deal?

Quick Close
Changed Interior Layout
After a few years turned into a short term rental!........on Airbnb, VRBO and private booking site https://bidcoshorttermrentals.guestybookings.com/

What was the outcome?

Income as STR is 3-5X long term rental

Lessons learned? Challenges?

It's hard to find good plumbers!

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

Realtor

I use Nest Thermostats.    I like 2 of their features......The first is the Eco feature which turns the AC up to a predetermined level when the space is unoccupied.    The second is the remote acccess to the thermostat.    You can adjust ecomode to an even higher temp while it is unoccupied, I usually do 79, and then lower it back to my Standard eco of 76 which is what I keep eco set to when I have guests.     So If they are gone for a week I would turn it up to 79, then on the day they are returning, drop it to 76 (As long as your AC will not freezw up on a 3 degree drop)...., You can also do a couple of increments throughout the day.......I also usually turn it up in the morning while it is cooler out so that it can stabilize easier.    Then as soon as the guests enter, Nest automatically adjusts to their last setting.....I hope this helps....and good luck

In my opinion, depending on hom much it is costing you in revenue, I would go with both!   If you think it will be another 30 days, costing you thousands in revenue, it is worthwhile to get the satellite right now and then back it up with the Comcast for the faster internet.   I am not sure if Satellite will commit you to 12 months.....but you can always go internet only with Comcast until you can get out of the Satellite contract.   I would just disclose that you only have100mbps satellite internet for the first guests.    I feel that if they know ahead of time they will be understanding......After all, they are vacationing in the mountains!

Hi Blake

I have been using Price Labs and have been very happy with the results. I do not let them determine my absolute price, but I do like the way they trend the pricing as to whether my pricing has to be higher or lower in general based on the market occupancy. I also follow their guidelines that if I am getting booked up really early then I raise my base price a little at a time for that listing until my 30 day vacancy rate is 40-60% And if my 30 day vacancy rate is higher than 60%, I drop my price slowly until it is hits the target 40-60%.

I typically only check these about once per week and my numbers have been in line unless something is happening like the current situation, then I just tweak the numbers daily until the listing is back in range.

Thanks

Bernie

Investment Info:

Single-family residence other investment.

Was used as a Long term rental for 13 years, Now being used as a Short term rental:

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

I had been investing in Long term Rentals for about 30 Years. I was interested in STR when I had an opportunity with a tenant vacating. The results have been excellent and my occupancy has been quite high through different seasons.

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

The realtor (referred by my wedding DJ) I bought my primary residence through 18 years ago knew I was investing in rentals and kept on sending me unique properties. This one fit my criteria perfectly and we were able to make a very favorable deal! Ad a 560 Sq Ft 1 BR house, it did not meet FNMA.FLMC Guidelines so they had a tough time finding a buyer. I went in with a cash deal (From a HELOC) and offerred them a quick close. I then cashout refid my cash back.

How did you finance this deal?

I went in with a cash deal (From a HELOC). I then cashout refid my cash back and paid back the HELOC.

How did you add value to the deal?

Not right away.....The property was in decent shape when I bouht it. After renting it for a couple of years and a tenant who did a lot of drywall damage, I decided to renovate the home and change the layout to a more favorable layout which was more modern and usable.

What was the outcome?

The Home has been a good investment for the last 13 years and is now turning out to be a better investment as a short term rental. I plan to turn all my long term rentals into Short Term Rentals if and when they become available.

Lessons learned? Challenges?

In a Short term rental, any damage , and the few incidents have been very minor, is realized right away and paid for within a few days. The property is able to be in day 1 shape every few days as opposed to getting the property back after a year or less requiring dmage repairs and deep cleanings!

I already see a lot of good replies such as , 2 night minimum, Verified ID, Stating that there is a security camera for their protection etc so I will not repeat them too much. Someone also mentioned no parties on the house rules, which is a great idea and I take it one step further. I require a deposit and in addition state

*NO smoking, pets or parties allowed inside the Apartment

Pet Cleanup $300 Minimum

Party Cleanup $300 Minimum

Smoking remediation $500 Minimum

The dollar amount here is not what I am going after. You mentioned not wanting to take a risk of getting bad guests, out of respect for your neighbors, which is commendable in itself. The deposit and cleanup dollars do not deter good guests….as a matter of fact it often enforces the idea that you are providing them a nice, clean respectable place for their stay. In addition, the deposit and cleanup amounts do deter people with ill intent from booking.

Another more important strategy in deterring bad guests is to not be the low-price leader of the neighborhood. Partiers are often looking for the property which meets their basic need for the lowest price. If you are priced a bit higher than your competition, this will send the bad guests elsewhere. Of course not everybody agrees with this strategy because of the potential of loosing good guests to a lower price. This also necessitates giving your place a slightly better look and feel than the competition. This also may cost a little more money. The challenge here is finding the balance of adding enough value into your unit to justify the higher price, and finding the right sustainable price your guests are willing to pay. Guests willing to pay a little more for a nicer place, typically take care of it better as well as respect the property and respect you as the host, more than other guests. Your upside is peace of mind you are getting good guests, having easier cleanings and minimal damage and getting paid more for your property being justifying the price point.