All Forum Posts by: Brandon Labordus

I am NOT a CPA! Hard to say without some more details, but having just gone through this the first time myself:

My understanding is that if the Ohio property is an LTR, you can only use losses from that to offset against LTR gains and rollover the rest. The only exception to this is if you earn Real Estate Professional Status.

The losses on your Delaware STR vacation property may POTENTIALLY offset against your W2 income. If your average rental period for the DE property was <7 days, and you didn't personally use the property for any more than 14 days, this gets classified as business activity income (as long as you materially participated in managing it). There are some hoops to jump through, but since this is active income you can then use any loss (including depreciation) to offset your W2 income.

A great many CPA's that are not real estate specific will not understand the STR loophole. Do your research on here and you will find lots of info on this. My rule of thumb - if you can't find a CPA that understands what you want to do, call 10 more!

I can't answer your question directly, but we just built a mountain cabin and the entire process was so painful that I have swore I will never do a new build again. Everything from delayed timelines (builder took 8+ months longer than his estimate) to supply chain shortages left me frazzled and dejected with the whole process. Yes it's cheaper to build - but any $ we saved by building got sucked up by losing 2 incredible years of STR earnings in 2021 and 2022, and got sucked up by sitting there panicking while interest rates skyrocketed from 2.5% to 7%. After all that, we still have "new house" issues crop up constantly as the house gets used.

I would not buy at all based on seasonality. Most people who are selling in those areas know the stats as well as you; they are more inclined to dump a property after summer season, and far less inclined to sell immediately before high season. 

Know what the numbers are in the down months, and work this into your purchase decision. Have cash reserves to get thru low season and relax with the knowledge that you will not make serious money until the next high season. If one low season will break this deal, it might not be a deal you worth doing. 

Proper was the very first player in the STR market - they had the only product that specifically targeted STRs for a while and we all used them. Unfortunately proper has become so popular in the STR arena that their prices have exploded. Definitely get a quote from them but I'm finding their prices to be laughable compared to other insurers. A lot of us in Gatlinburg started using Brightway. They have a STR product that is much more competitive. Not sure if it is available nationwide though. May be worth checking out.

This is a battle not worth fighting. HOA's - whether well run or not - have an incredible amount of power and say so over what you do with the property. BEST CASE here would be a fine. In my mind, the more likely scenario is:

1. Bored and angry full-time residents report you. 2. You get a notice of violation 3. You get a cease-and-desist letter from a high-power attorney who does this for a living 3. When you don't stop, they hold a hearing and get an injunction against you 4. They turn around and charge you for their legal expenses and put a lien on the property. And don't forget with most HOA's you have waived your right to legal counsel when you signed the covenants.

This very thing happens all the time in the beach towns of FL. Any STR realtor worth their salt will be able to tell you which neighborhoods to avoid for this exact reason.

Trying to run accurate numbers here - how often are you guys cleaning a STR hot tub? Any idea what the spa guys charge for service in Sevierville? Also - reading a lot where some hosts say they change water after every stay...is this really necessary? Figured this was overkill, especially with well water. Thanks guys.