All Forum Posts by: Carson McGee

Hi Matthew,

My team owns and manages condos in Maui. Every one of our units has a sleeper sofa, it is a great way to add space for an additional two guests (preferably kids). It also helps include your listing when guests filter by sleep count.

Hi Clay,

This is a good initial way to filter through properties. Any STR deals that hit this 15% rule are worth looking into further, but not guaranteed to always work out. Like any real estate rule, take it with a grain of salt and do your due diligence.

Hi Alec,

You are asking the right questions. The simplest way to analyze STRs is by comparing revenue to the acquisition price. After you have a basic understanding of a given market then you can start debating the details. 

For instance, my team purchases and manages STRs in Maui. All of the condos have HOAs (with high fees) so that wasn't up for debate. That market, however, has year-round seasonality so we get steady cash flow with little vacancy. 

Deciding on STRs is going to be very subjective but it'll come down to what properties have the greatest yield. We have condos we paid a premium for to get direct oceanfront views and others across the street from the beach with no views. All of them are returning what we expected, relative to our purchase price. The views help marketing but if the property costs double for a view and only generate 20% more in revenue then you may have to rethink.

With all that being said, the short-term rental space is promoting unique listings. Try to find a property that enables you to stand out from the competition. 

Hi James,

Airbnb or short term rental returns are still solid. There are a bunch of factors that will determine what revenue you can expect. You should research the specific market, competition, potential over-saturation, what can help you stand out etc.

Generating great Airbnb returns stems from having a unique property, marketing it well, and operating it efficiently. My team owns STR's in three markets and manages additional properties, I'd be happy to address any questions.

Maui, Hawaii is pretty hard to beat. Our 90%+ occupancy speaks to the great year-round weather and demand.

 This is on Maui! Elevated Stays is the 15% management company, built around a handful of personal investments. Message me if you are interested in more details.

 Hi Carlos,

Surprisingly, our STR condo investments are cash-flowing well. Even with decreased leverage at 25% down and high HOAs (a few $1,300/mo+), our occupancy rates (95%) and increasing nightly rates are yielding solid returns. The high taxes are passed straight along to guests/renters. As far as property management, there are definitely more affordable options. Our team is currently offering full service for 15%. Investors can also find co-hosts and other companies for a decent rate. Hope this helps clarify!

Hi Mike,

Congrats on pursuing a condo investment in Maui! My team owns and manages short-term rental condos throughout Maui. That is not a blanket statement that you need 30% down payment and on-island lending. Some realtors may prefer that but we have personally closed 5+ condos in the past 12 months with off-island lending and 25% down (80 LTV is possible but hard to find).

As far as regulations, make sure the complex is hotel/resort zoned or grandfathered in via the "Minatoya List".

Hi Carrie,

There is some solid advice in this thread. I have bought six condos in Maui over the past few years and manage for other owners. We have been successful thus far but it does take patience and accurate underwriting (we strive for 15%-20% gross revenue vs price). 

The zoning is relatively strict, if you narrow it down to the "condotel" resort-zoned complexes then you are fine. You have to account for the high HOA fees, potential assessments (especially if waterfront), and generally higher labor costs.

Our properties average 95% annual occupancy with strong ADR growth. The appreciation is very steady, as no new short-term rentals are being built on Maui. Ultimately you need to research the market and your buy box, the good deals require you to act fast. 

I have never had any issues with HOAs regarding long-term rentals. They obviously aren't an investor's preference due to the cost and risk of regulations. It definitely depends on the deal and circumstances. I own short-term rentals in both Maui & Orlando and both have HOAs. Those specific communities are built around transient accommodations but still add an increased monthly expense. You also need to account for potential services they provide that you wouldn't have to pay out of pocket for (trash service, community pool, snow removal etc.).