All Forum Posts by: Bob Johnson

Long time lurker, second time poster, please be kind! :)

Back story - I own a number of SFR properties in California, and they cash flow to a point where it's my full time gig now and thus I am a full time real estate investor after a couple decades of getting beat up on Wall Street.

Being the entrepreneurial guy I am though, I'm looking to get my broker's license so I can freely buy, sell, and look at properties on my own rather than having to line up one of my agents to let me into a new to market property that usually gets sold before I can get in there to scope it out.  Saving commissions also on the benefits list, as most of what I'm looking at is over $1 million.

I already have an LLC for my investment holding company, no problem there, will probably use serial LLC's under that for the brokerage and individual future investments, which I am looking to expand to commercial and land/development.

Now, I took a couple real estate classes during my under/post-graduate years, will this usually enable me to bypass the agent exam and move straight to the brokerage one?

And if no luck there, I assume I have to take the agent classes, pass the CA. test, and wait it out 2 years? I would be using Allied, PrepAgent or License Solution for the classes probably (no real need for mentoring on how to sell/build the biz as this is for me and partners only), but I would need to find a brokerage on the same page as me - a low cost, low hassle solution with MLS access for a guy that might have 1 transaction a year tops until I get my broker's license.

Any suggestions/help would be appreciated, especially from investor/brokers, thank you!

How much could I expect as a nightly rate? Monthly revenue? - In June/July/August, if you squeezed 6-7 beds in there, you would probably be at $300 a night, less fees/commish/etc. 

How seasonal is the San Diego Vacation rental market? - Very seasonal.  You'll rent it out over major holidays, but not much else unless you get a businessman on assignment at SPAWAR or something over the 9 months of low season.

Air BnB vs VRBO and others? - AirBNB is horrendous is you like to vet your renters, VRBO is better but trying to force users to make it an all online booking avenue as well.  Zillow and Craigslist are free, but usually are full of scammers and the like.

What specifically makes something a good vacation rental? - Proximity to things to do.  A mile walk to the beach is too far for families, but if you provide bikes, couples and singles will be interested.  Pony up for a professional interior decorator and pro photographer to take pics. 

Anything else I'm not considering or asking? - Furnishing it will cost a bit, make use of IKEA and Big Lots.  Insurance policy for vacation rentals is handled by specialty lines companies (I use CBIZ in Montana) and have a good umbrella policy as well.

In the end, it depends if you are using a manager (cost 15% to 30% of the gross rents), or do it yourself.  It's actually a business - you're a hotelier now, expect calls in the middle of the night.  As you might assume, I run one here in town, but my other rentals are all month to month - call it diversified cash flows.  Anything else I would buy here in town would be run as a vacation rental, 2-3% cap ain't getting it done, and if you're smart then yes, a 6-8% cap rate is do-able, but you're going to have to hustle.  

Hope that helps!