All Forum Posts by: Brian Barch

I could be wrong here, but I think some of the glamping trend is fading.  I don't see or hear about a lot of repeat customers in that space.  I get the appeal to saying you roughed it a bit one time, but it'd be tough to sell people on that year after year.  

I also don't love the long term appreciation aspect of effectively owning a high end tent.

I think you are going about it just fine.

I would use several tools, airdna, awning, enemy method, local realtors/PMs to arrive at revenue projections.

Think about furnishings, design, etc. 15% of purchase price/year in revenue is a good target for STRs, but all depends on your goals.

as I’m sure you well know, do your due diligence over and over, but at some point you have to do the leap of it meets your threshold….no such thing as a sure thing

It sounds like you have $5-7k/mo worth of cash flow margin to work with even if things decline. 

Also, I think it’s nice to remind yourself that real estate has traditionally been a long game. I’m thrilled for your recent success, but that need not be the bar going forward. 10 years from now, are you going to be happy that you did this?

if you do, simply don’t bet the farm doing so. Use your most conservative estimate and make sure you could stomach that actualizing

If all the numbers you stated are true, I would sell, like tomorrow.

my hunch is an investor won’t buy something for $1.8M that generates $12k/mo, but I could be wrong. 

Appreciate the blog post.  Candidly, I'm not in the Smokies' market (although I'm in the Blue Ridge mountain market), so do take my opinion with a grain of salt.

While I don't think we'll have a total market crash of any sort, I do feel as though the Smokie's market seems a little overheated from afar.  I see lots of new builds strictly for the purpose of short term rentals, undersized places going for huge amounts.

The vacation market is obviously different than the primary housing market in that people can cut back on vacations in the short term, and they can choose to vacation in other areas.  When I see places selling for $1M, I inherently have an idea of the nightly rate they have to charge to make that break even, and suddenly it becomes more expensive than being on the beach in FL and you question if that can last.

It's hard to apply peanut butter spread answers here.  It all depends on what one's motive is.  Are they getting personal use out of it?  Did they have false expectations of $1,000/mo cash flow?

As a generality, I'd be more cautious buying an STR right now as there needs to be a small supply shake out, something that's not likely to fully run it's course for at least another year. That's not to say there aren't opportunities, but it feels like we are transitioning from the growth portion of the product life cycle curve, to the maturity portion.

This really depends on market and property.

We bought in Nov 22 in the southern Appalachians. We started out with about 65% occupancy and a 1-2 week lead time.

but since may, we’ve gone up to 85% occupancy and a 1-3 month lead time. So it’s gotten better for us.

But still, that could be because we now have reviews under our belt? Or the market? Really can’t say, only that it’s improved throughout the year, seasonality aside

Yes, I have a rental up in Clayton. Would be happy to talk shop!

I like to triangulate several sources: airdna, awning, rabbu, enemy method, talking to local realtors, PMs, etc. if you do so, I think it’s fairly easy to understand what your typical seasonality is. From there, you want to come up with a high/low range, then determine if you could live with the low end of that range.

determining occupancy can be mildly fruitless, as you can essentially “buy” occupancy with a low enough rate. What you really care about is total revenue. Shooting for 15% annually of total purchase price is a good goal to shoot for.

A highly personal question.  

I don't think distance from property needs to weigh too heavily in your answer.  This is really about preference.  Also know that there are a lot of modern PM options that are more in the 10-15% fee range (as opposed to 30%).  I'm talking about places like awning.com, key bee, etc.

I'm fully capable of managing myself. however I really like having a buffer between me and all the guests.  The discount asks, the back and forth on checkin times, etc.  I had much more peace in busy season and holidays just not having to worry about that.  That's worth something to me personally.  

I totally get that someone may hear that and say it's absurd to give away 15%, but my W2 job is still my main focus, and having a PM makes it feasible for me to keep my focus where it needs to be, and allows me to scale easier should I want to.  It keeps the business fun for me, and not tedius.  YMMV.  I don't think you NEED to do one or the other.  It's personal preference.