All Forum Posts by: Jacob Lockard

@Lisa Marie Thank you for the thoughtful contrarian feedback :)

In regards to my financial situation, I do have a few hundred dollars of cash leftover after expenses (and mortgage) are paid each month. And I have $19k saved from the first year's rental income for expenditures. So, I don't have concerns that I won't be able to fix something or cover the current expenses for 2024. And as for perspective, I initially bought the home to buy and hold. And I agree that from a business perspective, the appreciation is worth it in the long term.

Thank you for putting the STR income into perspective. It's nice to have your insight on the current state of financial expectations for STR properties. I agree that the value of future gains outweighs the negative cash flow.

I hadn't thought of rental arbitrage. That's a great creative idea to propose it as a long-term rental, as opposed to the typical arbitrage terms. Do you know of anyone who has done this successfully?

@John Underwood It could be the better option to sell, I agree. Unless I rent the home long term for $5k a month and take on and extra $500 out of my own pocket until rates go down and I refinance or rents increase enough to even out or better.

And that's a great point about owner occupant tax savings, it would benefit me to at least hold out until December.

@Sarah Kensinger Will do :)

@Sarah Kensinger Thank you for sending this link along. I will definitely be attending.

@Sarah Kensinger You make a great point that it very well could have been that the previous PM wasn't as experienced as they could have been. I have been thinking a lot about how hiring the right PM might help me out in many ways, in all of the points you've outlined.

I think your idea of talking with STR operators in Atlanta makes a lot of sense, I am already on many FB groups. I will bring the conversation to them.

Thank you @Bill B., that breakdown makes a lot of sense and gives me some financial clarity if I decided to sell now.

No worries Michael :) I think that's where I would need to figure out what my next step would be if I hold until December of next year to sell.

To your point, at least renting it long term until then might be my best bet in bringing in consistent rental income, rather than an inconsistent and more costly short term rental.

Hi Bill, thanks for the feedback. I bought the home for $859k and I put $100k down. Seems like holding to sell until December makes the most sense.

As for lodging, I think you're right that it's already taken out via Airbnb. Once I list the entire home, I believe you're right that I could include a cleaning fee. I haven't for my current room listings, as I've done most of the cleaning myself, and I saw fewer bookings when I included cleaning fees.

Hi Michael, thank you for the advice. As for how long I've lived in the home, it's only been since December of 2022. So, it's technically been one full year as of last month. I think in this situation, it wouldn't be tax free, unfortunately.

I have been considering taking whatever profit from selling it and investing in a duplex or 4 plex once the rates dip later this year or early next year. I will need to do some more research into them and the area I'm moving to. And yes, it's been both rewarding and challenging to live in a home with a rotating cast of renters.

Hello everyone,
Here are some details about my situation. I bought the house in December 2022 to start a short term rental. It's an owner occupy situation, where I live in the home and rent the other 3 rooms on Airbnb as well as Peerspace. It's done ok in 2023 at $34.6k, however, I'm planning to move out of the house for June/July of this year and will need to make a decision. I will need to either rent the entire home as a short/mid term rental or sell the house. Additionally, I am aware that once I move out, I can list the home on VRBO and several other platforms to help boost bookings.

The reason why I'm considering/leaning toward selling the house, is that when I begin to run the numbers, the expenses exceed what I could potentially make. According to AirDNA, the projected revenue would be $82.7k. And obviously, this figure is not guaranteed. Once I was able to break down the expenses, I would need to bring in something closer to $120k to make it worthwhile. I know that I could save some money by continuing to manage the property on my own, however, I have concerns about being out of state and not having eyes on the state of the home (leaks, damages, etc.) and of course, parties. My home is a magnet for people who want to party, as it's 3500 sq ft and has a history of parties from the previous owner's management experience.

I'm looking for some input and advice on what my best option might be. Long term wouldn't work for me currently, as the going rental rate for my house would be under what my current mortgage is. If rates fall later this year as forecasted, it could be worth factoring in the possibility to refinance and bring my mortgage down low enough to continue renting it as a short term rental or consider renting it mid or long term. I'm happy to hear any creative ideas around what you might do in my situation. I'm sure there are things I'm not considering and would appreciate your feedback.

Here are some additional details about the home and financial situation.

Location: Atlanta, Georgia
Mortgage: $5513/mo @6% interest
Zillow Rental Estimate: $4966
Current Mortgage Balance: $716k
Zillow Home Value Estimate: $825-1.02m

AirDNA Information:Projected Revenue: $82.7k
Average nightly rate (as entire home): $347
Occupancy: 65%

Projected Operating Expenses: $41k
Management Fee: 20% - $16500
Lodging Tax: 5% - $4134
Property Tax: (included in mortgage escrow)
Cleaning Fees: $6600
Maintenance: $3400
Insurance: $5200
Utilities: $5172

Projected Monthly Income: $6891 - $5513 = $1378
Projected Expenses: $3416 /mo
After Expenses: -$2038 / mo

Here are my listings:
https://www.airbnb.com/rooms/796636182229405398?guests=1&...
https://www.airbnb.com/rooms/842278641447927875?guests=1&...
https://www.airbnb.com/rooms/847341496880342421?check_in=202...