All Forum Posts by: Eric P.

Hi all,

I have been using my basement as an STR house hack for about 2 months, currently I'm only listing on AirBnB. It's done much better than I predicted (due to the summer months probably) and I want to ensure I have all my ducks in a row for next year's taxes so I don't get blindsided.

As a live in STR (where I rent out a portion of my home) would making an LLC help in mitigating tax impact? I've kept a detailed record of start-up expenses for write offs, but will the AirBnB income be taxed at the end of the year based off of my income tax bracket? (Most of my income is W2 income, about 33% above the local median).

Please share your STR tax mitigation stategies, to make this a viable investment strategy. The more details you can share, the better!

@ScottSmith

It is illegal to pursue any short-term rental activity in a government-backed mortgage. Fannie Mae, FHA, USDA, etc

Hey everyone, I am looking to buy a house for short term rental in Oregon and wanted to know if I should start a LLC for it or just buy it without one? I know there is tax benefits with having it under one but can I transfer it over to an LLC after purchasing the home?

Your help is greatly appreciated! 

Just got a phone call from a realtor.  She used to cut my hair 10 years ago, before becoming a real estate agent.  She had 5 guys that were looking for a furnished house to stay in while they do there work here in town.  They are going to be here about a year.  My houses that sleep 5 people comfortably go for $1000/week.  We are going to show it to them tonight.

What kind of commission do you think the realtor is going to charge me?  Normally, if a current tenant or other person refers a renter to me, I give them a commission.  $50, $75 or $100; depending on the size of the house.  The 5 person house is a $100 commission house.

I would love to get opinions/feedback from the forum.

My take: In long-term rentals you are selling accommodations. So prior rental rates are a very valid projection of what the market can bear. In vacation rentals you are selling an "experience". So it's not just about the "horse" but also about the "jockey" and prior rental history of the particular property is not as important as the rental history and potential of similar/comparable properties that are  actually managed and marketed successfully.

What happened: I recently had a buyer client who was interested in a particular condo on the beach as an investment property. The unit is 2b/2b, sleeps 6, in a complex of 80 other units. Location is very good and the price for that unit was lower than the others. I am personally aware of similar units in that particular complex grossing $45K to $50K per year. The reported rental history for this one was around $29K per year for the past three year. The client decided that made it a "bad investment". I did some research after that and found out the following: the unit was dated (bad decor), managed and advertised by the owner on VRBO. The listing had blurry pictures, the owner had only 70% response rate and a number of low reviews stating the unit was dirty. (To which he made some rather snide responses of "it's summer and sand gets everywhere"). In my opinion the rental history in this case is irrelevant. What is relevant is the "rental potential". My client (who has never owned or managed vacation rentals) disagreed with my opinion and decided to pass on the property despite the attractive price. She had initially said she wanted to find "a deal". In my opinion this was "a deal", lol. 

What do you think? What is your take on vacation rental projections?

I am trying to calculate potential returns on a short term investment property, specifically a Pensacola Beach rental. I’ve nailed down rates per season but I’m not sure how to figure occupancy.

For those of you that own a STR in a beach town, how many days per year do you have renters? If you really know your numbers, how many days for each season.

Hi @Ryan Denman, I align with @Jake S. in seeking longer term lower initial down payment as well. 

I am after monthly cashflow so that makes sense in my mind by keeping the mortgage payment as low as I can, but if you can afford a 15yr and still have a good cashflow each month then that sounds ideal to me!

I was just under the assumption (like a hotel) that we would provide the linens but I spoke with some local owners this weekend and every place in the complex requires the guest to bring their own. This would make the process (turnover) much easier/faster but I feel you then loose that experience. What are you thoughts on this? The property will be a summer vacation rental, mostly rented by the week.

My lender will not consider income from my short term rentals as part of my Debt to Income Ratio. Any suggestions or workarounds? (Besides submitting a bogus lease for a “long term tenant”... yes this has been suggested... not doing it.)