All Forum Posts by: Britt Hennings

Quote from @John Mocker:

Britt,

Just a reminder, once you rent it out and are no longer living there, the home is not owner occupied. Most Homeowners Insurance policies require the house to be owner occupied. Check with your agent to see if you need to rewrite the policy and what the new rate will be as a STR.

Yes! Those numbers include an STR policy rate. I put it as $50/mo higher than the quote i just received so my numbers would be a bit better.

I'm assuming STR insurance would be more than landlord insurance?

Quote from @Annie Seurer:

I don't have what you are looking for but hope someone in a similar situation can give you more insight. Going over your numbers, have you considered a long term rental instead? Don't get me wrong, I love STRs, but if your place is average, you plan to keep it average, you may be better off just getting a long term renter and make out better. 

If you do decide to go the STR route, how many beds do you plan to have? More heads in beds = higher ADR. Who are your Guests and what do they do in the area? Are there any low cost amenities you could include to make your place stand out, ie firepit, games, etc.? It seems most STRs in the area don't have professional photography - an easy way to stand out. Unfortunately, it's hard to be profitable in the STR world without 'going all in' nowadays!

 I would have a leg up in that I am a professional photographer, and that my rental would have a large fenced yard, playset,and a playroom. 3 rooms with 4-5 beds.

I did reach out to property managers and it seems i was undervaluing its revenue as an LTR. After thinking about it for a few days that's the direction I'm leaning towards. It would take a lot less up front capital and would be less work which i wouldn't complain about. 

Thank you for the guidance

Quote from @Jonathan Greene:

So after sitting on this for a few days Airbnb seems like a stretch right now. I've reached out to a few property managers for comps and opinions for rent and expenditures in the meantime. My rental rate was low and costs were higher than what my market is. TLDR this house looks better as an LTR. I should be able to rent it out for $1600/mo minimum with little to no capital invested. With NOI of $400-500/mo.

Thanks for taking the time to respond and provide me something to chew on.

@Jonathan Greene Haha yes I got a shout out! Is that reverse bullying?

Im a noob investor. Just posted a deal I will be doing in STR. Everyone go roast me.

I have the opportunity to turn my first home into a STR once moving into a new home. I have read all the blog posts, etc but would rather talk numbers with someone in a similar situation/in my area. I live far west of Knoxville near Crossville, TN so bonus points if you live near me. I have a hard time trusting AirDNA numbers etc. and I have a hard time reaching out to hosts near me because the platform is restrictive.

My home is unspectacular in a good way haha. It's a 3/2 bath home in good condition, good location, and is partially updated, but it is not the $300/night type listing. Crossville is a small to mid size city and growing with many retirement communities/cities nearby. I see similar listings up for $100-$180/night.

I am preparing to get the property ready with about $3k in furniture, dishes, linens, and everything else to make it ready. It will be self managed, I will be near the unit (less than 5 mins away) to clean and take care of any issues.

My numbers:
Approx Value of Home $240-280k
Current monthly cost / $860 mo (mortg,ins,tax)
Utilities / $250. mo (elec,gas,water,trash,internet)

Cost to run as Airbnb
Approx monthly cost with STR insurance ($250/mo?) / $1000
Utilities / $300 mo.
Supplies / $60 mo.
Lawn Mowers / $200 mo.

Total monthly cost$1600-1700

Target nightly rate starting out: $140
Cleaning Fee: $50
Avg. occupancy rate for my area: 46% (This could be inaccurate)
Projection: $1932 (@ 46% occupancy) + 300 (cleaning fee @ 6 stays) = $2232 - $67 (3% booking fee)

Monthly Revenue:$2165
NOI: ~$500/mo

So if you have a lower-end home in a smaller town here are the numbers I'm interested in:

Total Revenue for 2023 and YTD
Occupancy Rate
Approx. Value of Home
Operating Costs
NOI
Cost to turn a unit
Any other pertinent information I need to consider

Also if any of this is way off please do tell. Just trying to solidify my numbers before diving in.

Just missed it! Send me a message if you have another meetup.

@John Leavelle

Thanks for breaking it down because that makes sense that I would need to get it at a better deal. 15k in repairs wouldn't bring this home up to its comps. Ultimately I think I'm going to have to pass on this deal because it is now more than just cosmetic work and I don't want to get in over my head on my first deal. I had some relatives in the area check it out and there is more work that has to be done than what is in the listing (why it's been on the market for 8 months). I believe it has a cracked foundation and flooring throughout the house needs to be done. I will have to do some serious thinking because if they accept an offer around 60-70k that would be enough room for error and learning mistakes.

I will post the inspection report if I go through with this deal.

Do you have any money saved up for a down payment? Hard money maybe? From the podcasts I've listened to Wholesaling isn't usually the first route into real estate. The last podcast they put out I think it's titled "From $3500 to $400000" or something like that and he does wholesaling exclusively. Do you have a deal your looking at right now?

What are you looking for specifically? I'm guessing your looking for a flip or wholesale deal.