All Forum Posts by: Carrie Hays

Tony,

Feel free to give me a call. My number is in the footer of my website. I am in Lexington as well and we own 5 STRs and have done a dozen flips. There is a banker out of Bowling Green that has a product that may work really well for you. 

I'd also love to analyze your property that you have with Vacasa. Generally, the properties they manage perform in the 50th percentile or below. I'm definitely not saying that yours does, but I would be happy to take a look at it. 

I am looking for any agents or investors that are interested in joining a group of 20 for a subscription to the new AirDNA investor dashboard. See link to sample dashboard here.

Data is for entire US for a year and will be $1,195 per person. If you are interested please reach out to me.

If you and your wife are w2 employees the major incentive to STRs over other types of rental property is the ability to make that non-passive income and losses. 

I put together a video to explain how short-term rentals can help people save thousands in taxes and at the same time grow their financial wealth. If you have any interest in learning more, check it out.

Investment Info:

Single-family residence buy & hold investment.

We purchased this home (and the one next door) as a fix and hold residential property to be used as a short-term rental that I materially manage. Our primary motivation for purchasing the property was that it sits on a lot zoned for multi-use. Our long-term strategy will be to demolish and redevelop the lots into townhomes. For the next 7 years or so, we plan to operate these properties as STRs.

What made you interested in investing in this type of deal?

We enjoy the returns on STRs, but we invested specifically in this deal for the long-term potential for development of the lots. Beaufort has strict restrictions on STRs and all neighborhoods are currently at the maximize for STRs, however, with these two houses being on multi-use zoned lots they are not restricted by the usual STR cap.

How did you find this deal and how did you negotiate it?

I found this deal through the listing on the MLS and engaged a local agent for the purchase.

How did you finance this deal?

Used a 1031 from a duplex investment to fund the 20% down for a conventional 30 year fixed mortgage.

How did you add value to the deal?

Renovated the interior and exterior of the homes. Converted the property from a long-term rental to short-term rental.

What was the outcome?

The property is producing better-than-expected cash returns.

Lessons learned? Challenges?

If you are going to operate a short-term rental, know the STR restrictions in-depth and allow more time than you think for the permitting process. We were not expecting to have to replace the old windows in the house, but in order to pass the STR inspection we had to.

I live in Lexington and we are using a real estate focused CPA firm out of Texas (Mike Pine & Co.). So much more than just filing the taxes, they are truly tax advisors and planners. If your taxes are fairly basic outside of real estate investing I would highly recommend going with a CPA that focuses on real estate tax law. I asked our previous CPA about bonus depreciation and was told “the IRS frowns on multi-year losses.” We started looking for a new one after that.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $125,000
Cash invested: $37,000

5BR/3.5BA home w/ finished basement. Main level features: Family room w/ fireplace, formal dining room, eat-in kitchen w/ tile floor & pantry, laundry room, & conveniently located half bath. Upstairs: Spacious master bedroom w/ double trey ceiling & his/her walk-in closets, Master bath

What made you interested in investing in this type of deal?

Primarily cosmetic renovations required. Quick turnaround, stable market

How did you find this deal and how did you negotiate it?

MLS listing - listing price was $140,000. Multiple offers, but cash purchase made it appealing to the seller

How did you finance this deal?

Cash

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Lagrange.

Purchase price: $42,000
Cash invested: $30,000

Cinder block 2/1 duplex. One unit was rented for below market rent and other unit was vacant. Renovated vacant unit, raised rent by 60% to $600, existing tenant was able to qualify for higher rent and wanted to move to new unit. We chose to rent to existing tenant for slightly below market because she has been there for 14 years and takes very good care of her unit.

Currently working to renovate other side and will then place in rental program at $675-700 per month.

What made you interested in investing in this type of deal?

Cash flow potential was extremely high. We are expecting an 18% CAP rate.

How did you find this deal and how did you negotiate it?

Found on MLS and watched until price was reduced to $45,000. Offered $42,000 cash and seller accepted.

How did you finance this deal?

Cash purchase through a self-funded 401k loan. We will be financing once the rehab is complete and both units are rented.

How did you add value to the deal?

Full rehab, including installing central HVAC in both units. Added significant amount of curb appeal by painting exterior and cleaning up the yard.

What was the outcome?

First unit was rehabbed and rented immediately. Second unit will undergo a 3 week rehab beginning the last week of May.

Lessons learned? Challenges?

Custom window sizes are expensive and take about 3-4 weeks for delivery. We did not estimate this delay when purchasing and should have ordered the windows on the day of closing.

Investment Info:

Single-family residence fix & flip investment in Newnan.

Purchase price: $86,000
Cash invested: $34,932
Sale price: $148,000

3 month renovation of a 3/2 SFH south of Atlanta.

What made you interested in investing in this type of deal?

Fast growing community, very few homes in the county that sell below $150,000.

How did you find this deal and how did you negotiate it?

Offmarket purchase based on local networking.

How did you finance this deal?

Traditional investment loan mortgage

How did you add value to the deal?

Full home renovation - new flooring, paint, kitchen and bath renovations, exterior paint.

What was the outcome?

Sold house offmarket for full asking price.

Lessons learned? Challenges?

We built in a 20% contigency budget. We were able to stay within the budget; however, there were challenges that came up that we had not planned on needing to address.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We worked with a local agent who was able to source the home offmarket and sell the home offmarket.