All Forum Posts by: Ernie Be

have a very picturesque property that I have thought of using as an Airbnb type situation, initially with a building not is use....however I am on a creek, with a little dock. I was thinking of possibly just doing a camp site set up of some kind. My question is would you do this where your main residence is even though it is almost 3 acres? I mainly think of my wife and children....What would be the bare minimum of what you would have? Thank you.

I have a very picturesque property that I have thought of using as an Airbnb type situation, initially with a building not is use....however I am on a creek, with a little dock. I was thinking of possibly just doing a camp site set up of some kind. My question is would you do this where your main residence is even though it is almost 3 acres? I mainly think of my wife and children....What would be the bare minimum of what you would have? Thank you.

Quote from @Ash Hegde:

It's a numbers game, instead of 600 x 12 you'll be withdrawing 2,000 x 12. The website probably assumes some investment returns, so when you withdraw 600/month you may even out, but at 2k/month you will likely be depleting your IRA faster than it grows. After closing on the loan, you will not have to keep taking 2k/month out (unless you need it to make the payments).

 Yup that's exactly what I was told by the mortgage company. Thank you for your response.

My financial advisor is on vacation so I thought I'd throw the question out here. I am not that knowledgeable as far as finances go. I have an ira with around 200k in it. I keep the rmd the lowest possible however to secure a loan on a home I inherited I had to adjust the rmd higher...now I want to move it back where it was because I am very conservative and like to have money for the unforseen future . My question simply is, does increasing your rmd from say 600 dollars to around 2grand a month significantly affect a loss of the IRA? Is it just a numbers game? At the end of the year would it be 200k minus 2 grand x 12? With the 600 taken it out it generally says in the 200k range at the end of the year. I realize markets come into play but I would just like a general idea. Thank you and hope I made sense.

I should say I inherited from my stepdad and just signed the mortgage that will be giving me 2 percent...so I think it could potentially be a very good investment. I prefer Airbnb but worst case scenario I could always long term I suppose. 

Just curious, I am just starting out in the Airbnb venture. If at the end of the year I have ended up not making as much as my expenses is it technically considered a loss or since I own the house, has the house provided me more income? Just interested in how that works. Thanks.

Quote from @Allison Craft:

I'm sorry for your loss. It's great that you're looking to turn this situation into a positive venture with Airbnb.
I think there is a lot to unpack here to answer your question. If the house is paid off, that takes away a lot of pressure. But sounds like you have old furniture in the house? STR are very competitive today and investing in a well-designed home is key to your success. Generally, I would recommend giving your Airbnb at least 6 months to build some credibility. It will give you the time to adjust your pricing strategy during different seasons and give you time to gather reviews which impacts your booking rates.
You also need to consider the effort and time required to manage a short-term rental compared to a long term. 
Best of luck to you, I hope you find success in whatever strategy you go with! 

Thank you...it isn't paid off but thankfully I was able to secure the lower mortgage rate. I am able to do a lot of the work and also keep it in house so to speak... The furniture is ok and I have been able to be creative with a few things. I just have the personality of hurrying up and wait! Thank you.

I inherited my stepdad home unfortunately because of his passing...I have always wanted to do the Airbnb venture and thus unfortunately gave me the opportunity. I like the idea of short/mid term rentals more then the long term...one big reason is not having to move all of his stuff...or at least being able to take my time. My question is how long do you personally wait to see how your Airbnb venture is going to go until strongly contemplating long term? I'm not as booked as I would like to be, and according to others they are going through similar circumstances...Do you expect immediate profits larger then your yearly mortgage and other expenses or do you give yourself a year or 2 like other business ventures? Thank you

Quote from @Erica Calella:

Quote from @Ernie Be:

I inherited my stepdad home unfortunately because of his passing...I have always wanted to do the Airbnb venture and thus unfortunately gave me the opportunity. I like the idea of short/mid term rentals more then the long term...one big reason is not having to move all of his stuff...or at least being able to take my time. My question is how long do you personally wait to see how your Airbnb venture is going to go until strongly contemplating long term? I'm not as booked as I would like to be, and according to others they are going through similar circumstances...Do you expect immediate profits larger then your yearly mortgage and other expenses or do you give yourself a year or 2 like other business ventures? Thank you.

Patience will be key here. It's true that demand seems to be low across the board this year for vacation or travel rentals. If you can weather the storm and some of the stress that comes with it, you may see a swing in momentum once the macroeconomic tides shift. My STR has been up and down all year, but overall I still see a lot of opportunity coming my way. I think transitioning to LTR will definitely remove a lot of the pressure, but the profits aren't where I would need them to be. Hang in there and try to keep yourself motivated.. you may be surprised to the upside in the end. If you aren't, then you'll know it's time to rethink your strategy.

 How long would you give yourself? Thank you for the response.

I inherited my stepdad home unfortunately because of his passing...I have always wanted to do the Airbnb venture and thus unfortunately gave me the opportunity. I like the idea of short/mid term rentals more then the long term...one big reason is not having to move all of his stuff...or at least being able to take my time. My question is how long do you personally wait to see how your Airbnb venture is going to go until strongly contemplating long term? I'm not as booked as I would like to be, and according to others they are going through similar circumstances...Do you expect immediate profits larger then your yearly mortgage and other expenses or do you give yourself a year or 2 like other business ventures? Thank you.