All Forum Posts by: Paul Kessenich

@Brian Ross

This sounds amazing.  In another life (well, really only 5 years ago), I owned a food cart where we sourced the vast majority of ingredients from local farms.  So your concept is close to my heart, and I'd love to visit sometime if I can.  I'd also love any updates on the project as you move along.  

Do you already have financing?

@Myka Artis

You said it:

"The amount of listings I need managed is a full time job."

Could you just hire someone full time for this?? You can train them to do things the way you want them to be done, and there are probably a fair number of people who would be interested in learning about the STR space. Plus, if they're local, you could probably have them coordinate cleanings and maintenance as well, eventually. Just a thought. My STR business is not big enough to do this yet, but it's something I'm thinking of as soon as we have the revenue to do it.

@Brian Ross

@Brian RossI'm with @Andrew Johnson on this one - decide who you want your clients to be, and design a house that fits their needs.  I have STRs in a college town, and I want to be renting to alumni, parents, business travelers, academics, and people in town for medical procedures at the hospital.  This means I'm looking to make my properties "homes", as opposed to hangout spaces for students.  This means well-equipped kitchen, comfortable living space, and cozy, well-appointed bedrooms.  Depending on your market, this may or may not be your target demographic.  One tip - large houses attract large groups, which is not necessarily a bad thing, but more people does mean more wear and tear on the house.  I like smaller 2-3 bedroom places.  They are easier to rent more frequently if you can price them competitively with hotels (e.g. well-appointed 3 bedroom priced around the price of 2 hotel rooms in the area).  

@Cory Mccarthy

I've read a little bit on this, and my understanding is that the bill would remove local regulation on short term rentals, meaning there would be less ability for local governments to restrict short term rentals.  So if you're for short term rentals, you're for the bill...

Dear Adam, Vacation rental property management sounds like a great way to get into the business. My wife and I rent out our own house part time, and we just bought a second property to rent full time in Ann Arbor. If I were just getting started, I'd hire and interview a few cleaning people or companies. Have them clean your space, and pay attention to the details. Are they on time? Have them make beds with fresh sheets. It should look like a hotel room when they are done. Talk with them about what they will charge if you're bringing them regular business. Is it by the square foot or number of rooms? Will they wash linens? Will they do a walkthrough for you? Once you have your cleaning service, seek out rentals to manage via online listings, print listings, or just signs in the yard. Know what you want to charge and know what you will work for. Final note-i just read west Michigan towns are heavily regulating short term rentals. Know what is and isn't allowed in your area. All of the regulation info is on the web. Good luck.

@Marcia Langley

Our plan is to rent the house we're negotiating on for multiple uses - weddings, vacations, events in town, but also as a possible short term weekly or monthly rental for corporate or academic groups.  I don't know what the landscape looks like where you're considering, but it seems like this idea could work.  One interesting issue in the NYC area is whether a search for NYC housing would bring up your Jersey City properties or not on the short term rental sites.  A little research could go a long way here - first do a search on homeaway or airbnb for NYC and see if properties in your area come up.  Then see what properties are for rent in your area and what kind of occupancy they have for the next three months or so.  If you do this once per month for a few months, you can learn a lot about what the demand looks like for this type of rental.  Good luck!

@Waverly Rennie

Managing a STVR from overseas seems like a difficult prospect!  For me the hard part would be trusting someone to manage the way you would.  So much about this business is about responsiveness and personal touches, and both might be lacking if you're trusting the day to day stuff to management.  You also probably know this, but management in this space is expensive - typically 20%+ of gross rents.  

I have a few good financing leads based on the business plan I put together, so I guess I can say I had some success.  The plan is only a page long, and I think it being short makes it easier for people to read and digest.  I'll PM you a copy after I post here.

@Simen Gundersen

Thank you!  I found a few documents on there that will make good starting points.  

Simen, what's your interest in REI?

Hi Short-term rental experts,

I'm talking to portfolio lenders about a mortgage on a short term rental I'm looking to buy in Ann Arbor, MI.  They are asking for a business plan and I'm wondering if anyone has a business plan they've written that they'd be willing to share (or even any part of it!).  

Hit send here before I asked this:  

What kind of renters are renting these 4 bedroom houses in your area?  The market is key when you're talking about short term rentals...

Hi Mark,

I used your spreadsheet design to do a quick analysis of a property in my area.  Properties near downtown/hospital/university don't tend to be very uniform here in Ann Arbor, so the analysis needs to be customized for each one.  

I do think my numbers are fairly realistic for this one.  We manage ourselves and the cleaning and tax gets passed through to the renters.  

For my wife and I, we don't have the income to qualify for this kind of mortgage (we have a mortgage on our primary residence now), and knowing how much we'd need to come up with for the initial investment and knowing it would take some time to get the occupancy up to where we want it, it seems risky to use hard money or some funding with a higher interest rate.

I would like to make this happen at some point though because there seems to be high upside and this market doesn't seem to be going away anytime soon - at least not in this area.