All Forum Posts by: Brian Barch

Quote from @Monique P.:

Quote from @Monique P.:

This is interesting, has anyone seen this: 

 https://www.youtube.com/watch?...

 This guy has been a real estate doom and gloomier for going on 3 years now….

Quote from @Jason Jennings:

Quote from @Melissa Nash:

Quote from @Bonny Drago:

@Melissa Nash omg just saw your reply ! I am still looking but this has given me pause ! I am not set on owning a house there was doing it more as a business! To start getting some cash flow ! I even thought of Oxnard by the water and Maui 😂

The market is very oversaturated there.... one of my cabins that usually at 90% occupancy for the last 3 years is less than 12% occupancy right now. So, there is not cashflow to be had right now. Not to be a debbie downer, but its the county's fault for allowing 3000+ new STR's during covid with no cap, and the locals are not having it, but more than that-its over saturated and pricing is a race to the bottom. I highly recommend looking in areas NOT oversaturated for best success.

Hello! I ran across this via Google. We currently own a 3 bedroom nice cabin up in Lake Arrowhead. We have been against turning it into a STR. I am up here right now and realized I have been here 4 times in the past year. As much as I would like to keep it private, I feel like its leaving a lot of money on the table. I am exploring the idea if turning this into a part time STR is a good idea even if it is only supplemental income to defer some costs of the mortgage. I am not necessary looking to make enough to cover everything, but it seems such a waste to sit here unused as much as it is. Thoughts?

I very much recommend doing this. It takes the pressure off of needing to use the place X times per year. 
also, it forced us to operate it as a business. We did deferred maintenance, and made the place not just nice enough for us, but nice enough for others as well

Investing is personal.  

What I'm missing are your goals.  Is this also a place for you or loved ones to stay when they are in town.  Is this solely for profit purposes?

I don't like condos for STRs.  why?

HOA dues are variable and go up with time. Assessments can be large and unpredictable. You are competing with other units solely on interior and price. Your appreciation is dependent on the entire building and its upkeep. HOA's are just one more governing board that can shut you down.

Without knowing all of the above, I'm generally a fan of your first deal being small and manageable (sounds like this is) so you can learn the game while minimizing downside risk.  Then, once you've built equity, you can leverage for the next deal, which beats being on the sidelines waiting for "perfect" to come.

Homes in highlands cost 2-3x the surrounding towns. It’s the aspen of the east. But perhaps unjustifiably so. The clientele tends to skew old and stuffy. 

I’d stick to Franklin, Clayton, Westminster, hayesville, Bryson city

I’m originally from Apple valley. 

It strikes me as a community that would be against STR. I would not buy just to STR there either

I have only gotten last minute bookings in the last 8 months. By last minute, most are 1-2 weeks out, max of 3. I am in an inexpensive, driveable market.

for the most part, last minute bookings is really another way to say ADR drop/demand drop. Guests are waiting to get lower rates and aren’t feeling the need to fight for dates 

Depends on your goals.
do you want to use for personal use?

How long to you plan to hold?

As a general rule for newbies, I recommend inexpensive places that have upside via modest design changes.  Smaller the better.

1) easier to clean

2) small places tend to have higher occupancy 

3) lower initial investment

4) lower risk while you learn

Quote from @John Underwood:

No.

You will never build any equity; it just gives you a job.

Wholeheartedly agree with this. You are missing out on leverage, tax breaks, and appreciation/equity. Generally speaking, arbitrage had its 15 seconds of fame and it has passed. 

I like SFH, less direct competition and no HOA.

1) LTR and STR are long game strategies. Be okay with that

2) I would learn on a smaller, less expensive property. Better occupancy, easier to clean, less risk

3) the more mature the market, the more you need a property that stands out. 

4) know what amenities are expected for your target market

Have been to myrtle beach for golf trips For decades. If Hilton head is white collar, myrtle beach is the blue collar cousin. Great beaches, affordable, kitschy as hell (a la Branson, gatlinburg, Wisconsin dells, etc).

Do note the seasonality and make sure it’s well baked into your numbers. I golf there in march, and it’s somewhat of a ghost town. That said, if you want to compete for golf groups, you need to package the room fee with course packages