All Forum Posts by: JD Martin

Quote from @Jim K.:

One of the things I learned early in this business is that the best thing to seen as by tenants is as a capable yet non-threatening entity. I actually learned it from my experiences as a tenant myself, in college and grad-school rental housing. There nothing more annoying than a landlord who doesn't follow the well-known "covenant of quiet enjoyment," which means that under normal circumstances a landlord should always give a tenant 24 hours of notice before he shows up and bangs on the door. Add to that a landlord who shows up driving a flashy car and dressed to the nines, and you have a clear starter recipe for rental nonpayment problems and a bag of concrete flushed down the toilet as a parting gift by an evicted tenant. The disrespectful, uncaring, arrogant, and contemptuous landlord always gets his in the end, one way or another.

So early on in my rental property business, I formulated "Jim's Law," and I have lived by it successfully since. If you are anywhere that your tenants could possibly see you out and about, you must never out-dress, out-drive, or out-crib them. Living in a very modest home compared to your net worth is more important in some places than others, I suppose, but I live within four or five miles of almost all my tenants and my county's website clearly gives the location of where their tax and sewer bills are sent, so unless I invest in a post office box and an LLC, I shouldn't live in a McMansion with a lawyer foyer, a garage mahal, and a turret.

If you want to wear nice shoes, designer clothing, or lots of jewelry, go on vacation in another country. Rent a hot car at their airport. Tell everyone you own four times more rentals than you do and they're eight times more profitable than they actually are. Hell, everyone else is doing it.

But my question to the community today has to do with e-bikes and bicycles. I've found myself absolutely intrigued by the idea of getting around this town on an ebike. Has anyone ever tried this and had it backfire on them?

@Scott Trench, the former CEO of this website, tells an amazing story of riding his bike to work and being accosted by a Ford F-150 driver who automatically assumes Trench is poor because he's on a bike. Has anyone else had things like this happen to them, especially as a landlord/property manager working with tenants? I'd love to hear your stories.

 I don't know how it looks, but it's dangerous in my area with narrow mountain roads and no shoulders. Beyond that, not having a vehicle means you can't even do any minor work on a property if you happen to be there. My truck is a rolling toolbox, with a camper top on the back, and I can often take care of minor issues right on the spot when I make rounds. For that reason I wouldn't do it. 

Beyond that, going around on a bike is going to be differentiating yourself from your tenant, opposite of what you're trying to do. Most tenants have a car and drive everywhere because they have to go to work and pick up kids and buy groceries and do a lot of things that are just logistically simpler with a vehicle. 

Quote from @Corey G.:

The girl from before left everything in the apartment and her utilities were left on. In this situation? 

 Your lease should describe what falls under abandonment and the remedies for such. There's a good chance your state has also already addressed the issue in your landlord/tenant laws.

Quote from @Greg Revel:

I just initiated one on my primary so I had to face some absolutely repulsive numbers on my refi that I did 2 years ago. After receiving $19,700 from me in actual payments (not including escrows), I was credited with a whopping $3,000 principal reduction, or over 84%(!!!) interest paid. Same 2 year timeframe with same payments on simple interest would've dropped the principal by over $11,000(again, !!!). Amortization seems to be nothing but legalized fraud. 

 Amortization isn't legalized fraud - it's a way of giving the consumer a stable, consistent payment over the life of the loan. The alternative would be whopper payments on the front end, when the amount owed is significant, and very small payments later. 

Let's use easy numbers. You borrow $100k at 5% interest. Amortized over 30 years you pay $535 per month, or $6420 per year. That's based on the fact that you want to hold the note for 30 years. If you only wanted to hold the note for 10 years, you could make very large extra payments on your amortization loan. If you had a simple interest, open ended loan, if you paid $1000 per month it would take you about 10 years to pay it off. If you paid an extra $465 on your amortization loan every month, guess how long the loan would be? 10 years. 

You can run all of this on just a simple interest calculator and you'll get the same numbers. In my example here, in year one you owe about $420 interest per month on that loan. You're paying $535 so by the end of the year you've only paid off a little over $1000 on the principal. Now we start in year two, same thing you owe maybe $410 interest per month. And so on. If you decided to pay the loan off early after 1 year, you would owe close to $5k in interest on that loan, and you would have paid about $6k in payments, so of course you only get credit for $1000 of principal payments. 

Quote from @Shawn McCormick:

@Noelle Maine One of the big reasons buying a STR out of state is buying one in an are where you enjoy going. If you come to Orlando alot and will get good use out of the unit, that checks a big box. And being involved in your unit (maintenance, decor, repairs, guest experience) goes a long way to ensuring your success.

Orlando sees (currently) over 70 million visitors a year and with EPIC theme park just opening last week, next years numbers are sure to increase. So we do have more units than anywhere for good reason. You do have to be better than hotels and other units to stand out, get the reviews you need and offer what your competitors can't/won't. Other markets seem to be dwindling and over regulating, where Kissimmee/Davenport embrace STR. We are literally built for it.

I would second @John Underwood in saying to stay away from condos. They are too plentiful, the HOA will eat up all profit and you are directly competing with thousand of other small units and thens of thousands of hotel rooms.

You can cash flow here, but you make your money when you buy. Buy a unit in a great community and close to the parks, either commit to being the best host or hire the best PM and you can do it. 

Best of luck

 We are doing somewhat better than last year and our guests are reporting spending and enjoying a lot of time at the new Universal, but we are still down from 2022 and 2023. 

Quote from @Lacey Gray:

@JD Martin Thanks for your reply! Yes, I'm local (Exit 25). Great advice to check with the mgmt agencies about waitlists, especially since we're entering the season late.

Marmora - awesome! Get a cheese steak at Kirks for me - best cheese steaks anywhere including the overrated tourist traps in Philly. There used to be an Amoco gas station in front of the WaWa next door to Kirks, I worked there in high school and remember when Kirk took over that pizza joint. I probably ate 3-4 cheese steaks a week from Kirk and always make a pilgrimage there when I'm in the area. 

Quote from @Lacey Gray:

@JD Martin Thanks for your reply! Our property was owner-used for the last 40 years and therefore has no rental history or pre-existing customers. What would you say is the best way to establish a new customer base (traditional sites or a VRBO-type approach)?

 If you are local, meaning you can just drive over to OC, I would go straight into the RE booking offices there - there's a bunch of them - and talk to the brokers. I guarantee you any of them worth anything has a call list/waiting list for anything in OC/SIC/Avalon/SH . These 3 islands are super popular with different groups - Avalon & Stone Harbor are ritzy, OC is a little more family oriented, SIC is popular with younger people - and even though about every inch of every island is built out there's nowhere near enough supply for everyone that wants to stay in the summer. It wouldn't surprise me at all if you can get a better deal with a local broker than going through an online service, though you can also do that in conjunction with a local broker. 

Regardless of how you do it, unless you want to attract younger, partying demographics I wouldn't have anything less than a 4 night minimum encompassing the weekend. Most places there rent by the full week so you don't have dead days in the middle of the week. Once you are up and running, if you do a good job and get the right guests (families preferably), you will find the same people looking to book your same house at the same time every year. South Jersey Shore is a pilgrimage for a lot of Philly people looking to get out of the city for a week or two every year. When I lived there (in SIC) the population was about 2500 from Sep-May and about 20k June through August. In the summer you just walked everywhere because it was faster than sitting in gridlock in a car. We would see the same people in the same rental houses every year - in fact on one street (57th) every house on my block except ours was a summer rental, empty for 9 months. The wind would howl down the street in the winter because there weren't any cars anywhere. 

Quote from @Jay Hinrichs:

Quote from @Collin Hays:

 There's some truth there. But even waterfront homes are down in sympathy with the rest. I own a 1400 square foot log cabin right on the Roaring Fork Creek near downtown Gatlinburg that was appraising for as much as $1.4 million in 2022. Today it's probably worth half of that, realistically.  I'm not a seller, so it doesn't matter much to me.

But yes, it's going to rent more often, and for more rent, than a comparable cabin across the road not on the creek.

is there trout in those streams can one fly fish ??  Are there any lakes there I see John Underwood talk about his lake house I wonder if its anywhere near there ?

Also the other Gentlemen north of me who post a bunch I know he has lake from on lake Coeur d' alane  which is a spectacular mtn lake with crytal blue water and at least it used to big big trout :)

We really don't have any natural lakes down here. Virtually everything we have is TVA dammed. They are still nice lakes - the mountains create a nice bowl effect, and they're stocked with plenty of fish plus what's grown "naturally" in the lakes - but they're kind of rough in the winter as TVA drops the levels 50% or more for flood control, so you have a lot of places where the docks are completely out of the water and there's a big brown mud ring around the lake. You see this a little less when the land flattens out some out of the mountains but still a similar effect. 

Quote from @Jay Hinrichs:

Quote from @JD Martin:

The biggest reason things are going bad is the economy & the saturation. I've lived in this area for 31 years and all of these towns were nothing towns until about 6 or 7 years ago. I love where I live - I'll never move - but honestly there's nothing special about these "tiny towns" in the mountains. There's a thousand of them around here and most of them aren't even real towns as they're lucky if they have a Piggly Wiggly to get some basic groceries instead of Dollar General. The only reason it even has the motels & hotels is because of Cherokee. Until AirBnb it was best known as the location of the Road to Nowhere; even the locals eventually just accepted a payoff from the feds. Bryson City doesn't even have a population of 2k, it's literally just a wet spot in the road in Swain County. Now it's been about 10 years since I've been in "the town" - the 74 bypass goes around it - and I'm sure they've had some growth but again it's just a middle of nowhere place. Everyone keeps saying "Gateway to the Smokies" but really the entrance on the NC side is north of Cherokee on windy 19 about half an hour away. I would imagine there's a lot of places you can stay closer to the entrance than that around Cherokee. 

All in all though you are probably positioned better than some of the North Georgia towns, which are *really* in the middle of nowhere. I remember many years ago my Navy buddies we all had a reunion in Dillard, and there was nothing on top of nothing there. I cut through on 23 when I'm coming home from Florida and there's more stuff these days but it's still in the middle of nowhere. 

kind of cracks me up folks description of MIddle of Nowhere.. out here in the west for instance Central to Eastern Oregon and Northern NV..  towns can be 100 miles between them those area real middle of no where places and 300 miles plus to a major city.. out east 300 miles north to south and you have covered multiple states :)

 Haha, true - but everything is relative. Out here in the mountains you can be 10 miles away as the crow flies and it can be a 30-40 minute drive depending on the condition of the roads. It's not just distance that makes it "the middle of nowhere". It may not be Nevada middle of nowhere but it's our middle of nowhere :)

Quote from @Lacey Gray:

@Jules Aton It is still a dry town! Wild, right? I will say that not having bars and night clubs like the neighboring islands makes it much more family friendly.

I lived in Sea Isle and went to high school at Ocean City High; the dryness doesn't stop the debauchery - there's enough liquor over the 9th and 34th Street bridges in Somers Point and Marmora to supply plenty of liquid lubrication! 

To your original question: the rental season is really short in OC et al. Essentially it starts at Memorial Day and ends at Labor Day. You've got about 13 weeks. The same families have been going to the same homes for generations and there's just not any real need for owners of these houses to hard advertise to strangers via Airbnb and VRBO. Where I lived in SIC we'd see the same people every summer, and they were usually renters. Your thought that the current system is inefficient is mistaken; because most of these places are rented and reserved a year or more in advance they just don't have a need for a heavy online presence.

Quote from @Jay Hinrichs:

Quote from @Collin Hays:

Quote from @Ken Boone:

I had 3 of my cabins shut down this week leading into Memorial Day Weekend for a number of projects and upgrades. Guests started checking in tonight and I still needed to get something for one of the cabins. I let the guests know I would be back to drop something off and they were cool. I ran up to the new Target in Sevierville.  At 8pm on the Friday night leading into Memorial Day Weekend, without doing maybe 6 or 7 mph over the speed limit, I made it from Target all the way to Walmart.  There was that little traffic. I was fully expecting things to be backed up on Winfield Dunn from in front of Lowes southward and already planned on taking the back way. Didn't need to. It's crazy.

I was there this week.There was ONE overnight camper in Cosby campground last night, though the park ranger was expecting 20 campers tonight (still not many).

I ate breakfast at the Pancake Pantry in Gatlinburg at 9am today with no wait. That’s a big deal.

It’s slow for sure. 

so for that neck of the woods if folks are not going there where are they going.. or are they just not taking any vacation time.. or are they maybe exploring new areas and not going back to the same places year after year.. or maybe they are taking a cruise instead or some other trip like to Europe or down to the carib ??  be interesting to know if habits have changed. 

I know for myself we do all sorts of different things the only thing we do as repeats is fly fishing in Montana  but even at that I go to different places pretty much every year. 

I wonder if covid gave and then has taken away.. by gave I mean created a false market and now we are back to normal and you had a big run on STR investments and inventory that would not have been therer if covid never happened.. ??

 I honestly think we have peaked as far as GSMNP traffic. PF/Sville/Gburg will still be a draw for the shopping and touristy stuff but lots of people are simply too fat or uninterested to hike around in the Smokies. If you like to fish or hike, GSMNP is great but if you're not into either of those things then it's tourist shopping in the outlet stores and Dollywood. I think everything has its saturation point and if you go anywhere in that area in the up seasons it's like being at Disneyworld at high season, and people that like to hike or fish can find lots of other places not so crowded to go do those things. I avoid the area like a plague any more, which is a shame because there's a few things I do like down there like the car museum and the aquarium and there's a great custard ice cream place, but I'm not going to drive an hour and then fight the ridiculous traffic for that stuff.