All Forum Posts by: Eric P.

@Jason Breton - @Andrew Myers has it right: you can rent out one or both units as medium-term furnished rentals for 30+ days and still make a good margin compared to a traditional unfurnished rental. I operate a 19-unit furnished rental business in San Francisco and just south. SF has some of the toughest STR restrictions in the country, but there is a strong year-round market for medium-term business travelers. It's a nice way to earn decent "semi-passive" cash flow in any market with a lot of business travelers. Tech workers, construction workers, consultants and medical professionals often travel for more than a month. Good luck!

What’s the best way to find Tech workers, construction workers, consultants, medical professionals, etc for medium term rentals? FurnishedFinders.com, craigslist, airbnb, or something else?

0 Votes

Originally posted by @Chai Xiong:

Yes, cable, internet, water, power, gas, hoa, quarterly carpet washing, powerwashing, pest control, grass cutting.

Also maybe: Mortgage, sewer, garbage, insurance, property taxes, security system, snow removal, maintenance, cap ex, local hotel tax & permits, site booking fees (airbnb, etc), cleanings (typically pass-through), property mgmt, supplies - it adds up - lotta hidden costs with STR!

2 Votes

Originally posted by @Jason Breton:

@Eric P. That would make perfect sense, however having just bought the home recently w/ 90% LTV it hasn't appreciated enough to sell. I'm thinking through other creative ways to use a co-host on Airbnb to turn one into a LTR, while keeping the other a STR. Have you heard of other people doing that?

A duplex with one LTR & one STR might not go that well as LTR tenants tend to get super annoyed by having a constant stream of drunk partying STR people on vacation next to them all the time. I'd STR it to the max until it's illegal, while keeping an eye toward the medium term rental / corporate housing / nurses, etc. Denver has huge hospitals right? Try to target traveling nurses for 3-6 month rentals!

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Originally posted by @Jason Breton:

I own a duplex in Denver. Living in 1 unit and renting the other on Airbnb. My intention was to rent on Airbnb upon exiting the property. That seems risky now considering the current trajectory of regulation in the city. How are other people thinking through this? Long term rental cash flow isn't great. Hard to turn my back on short term rental income. Thoughts?

I’d consider selling it & buying a vacation rental up in the mountains where they’re not regulating as heavily, right? Do a 1031 exchange

1 Vote

Originally posted by @Greg Schuricht:

For long term rentals its the 1% rule (for me anyway).

I've read that a good metric for STRs is whether a monthly mortgage payment equals a weeks worth of revenue.

Which financial metric do you use to filter your list of STR investable properties?

In the most desirable parts of the US (Tennessee, Florida, Arizona, Colorado, Utah, California, Hawaii), you can earn gross annual rental revenue of 15-20% of your purchase price. Eg, a $300k house will earn $45-60k in gross annual rental revenue. If you can get anything close to this, buy! (Of course, this requires being able to estimate annual rental revenue for a house or having a good agent who can help!)

3 Votes

Originally posted by @Danylo Bohdanov:

@Caileen Gonzalez

Hi Caileen, I'm also new to this. I have the same question, how to estimate occupancy rate. This is what I did. I selected the area I'm interested in, choose a several houses which I think are similar to what I was thinking about to buy. Then I just monitored each week/weekend if they are avaliable for rent or not. Not sure if this is the best way, maybe we can get an advice from experts.

That's a reasonable way to estimate occupancy rate. But, as others have mentioned, the entire Poconos is in regulatory flux right now since that Pa supreme court decision this summer. Now each of the Poconos townships is in the process of creating its own STR ordinances. If, after reading this entire thread, you still think the Poconos is the best place to invest your money, then I would strongly advise that you wait 6 months to buy in order to see what regulations & ordinances get passed by all the different townships.

Otherwise you’re playing with fire if you buy something & STR gets banned or restricted in that particular area 6 months later. Then good luck selling the house you just bought (or trying to find long-term tenants) when everyone else is doing it too at the same time bc of a new regulation! Just look at what’s happening in Hawaii right now after their new STR laws took effect:

https://www.kitv.com/story/408...

From that article:

Some of those former rental properties are already up for sale, and more are expected to hit the market. Not just from that property but all around Waikiki.

"There is a bit of a panic and frenzy start to develop," said General Manager Tom Lonigro. "This has the possibility of creating a direct and devastating economic impact.”

1 Vote

https://www.airdna.co/blog/air...

As has been discussed many times on these forums... there's no secret or magic formulas to success in STR. As always, the top (non-urban) areas are in the southeast, hawaii, or colorado/utah. Gotta capture that 4-season rental income if you want the high ROI

0 Votes

Originally posted by @William Shropshire:

We have the money, now my wife and I are trying to decide on our first rental spot. We live in Atlanta and still considering doing a traditional rental for our first property here (or maybe Nashville), but leaning towards the vacation rental due to higher potential revenue.

Came across this on AIRDNA. Just wanted to know people's thoughts on some of these ratings.

https://www.airdna.co/blog/best-places-buy-vacation-rental-property

For our STR we are leaning towards somewhere in Florida (Kissimmee), Hawaii (Maui), Vegas

There was a great thread on this recently:

https://www.biggerpockets.com/...

1 Vote

Originally posted by @Brandi Scharrer:

Thanks everyone for the feedback! All great input I'll need to keep in mind.

I was caught up in if a STR would qualify for "rent" during the "refinance" step of the BRRRR method I didn't even think about just seeing if I could refinance off my strength as a borrower and not worrying about the rental income. That may work for now but I'm sure as acquire more properties I won't be able to do this.

@Jerry Padilla - tell me more please. :) I don't own a "first" home, but my state of residence is Nevada and this home is in Michigan. If we live in the property can we claim it as a second home vs a rental or investment property? And if yes, how many months do we have to live there and can we have multiple homes? Thanks in advance.

I believe there's also some lenders who won't accept STR income during the first 2 yrs but they will accept the standard market rate for LTR as an income projection. So if you're earning $50k in STR income & the market LTR rental rate is $2k/mon for your house then, at the least, they'll count $24k of that income in your favor. So it gets you somewhere at least! Helps the DTI a bit. At least they're acknowledging the property has income generation value, albeit at a lower amount

0 Votes

Originally posted by @Account Closed:

I am entering the short term rental space and I would like to start with properties in Rochester, NY. Anyone knows of any specific areas in Rochester an Airbnb would generate the most profits and revenue? Also a recommendation of an investing agent would be great!

Thanks!!

The Northeast is tough for high ROI STR - the data reflects this. More here:

https://www.biggerpockets.com/...

0 Votes

All Forum Posts by: Eric P.

Eric P. has started 55 posts and replied 461 times.

Post: Exiting a House Hack with tightening Airbnb regulation

Post: Monthly reoccurring expenses

Post: Exiting a House Hack with tightening Airbnb regulation

Post: Exiting a House Hack with tightening Airbnb regulation

Post: STR Investing - which quick metric do you use to filter property?

Post: Vacation Rentals in the Poconos

Post: New AirDNA report on top locations

Post: AIRDNA - Best Places To Invest

Post: Brrr + STR "Refinance" Question

Post: Airbnb in Rochester, NY