All Forum Posts by: Jeremy H.

Depends on the area - I have a duplex in an older area and don't have a dishwasher in either unit. I did add washer/dryer hook-ups though. These are 2br/1ba units. I have never gotten negative feedback on not having a dishwasher. 

The newer expensive units in the area have dishwashers, the older smaller ones don't. None of them. But the area is so good the old units rent out anyways. Most have window units or portable plug-in heaters too. 

If you already have the plumbing in place I'd go ahead and add it in. If you don't have the plumbing then I'd skip it. If it's designed for a family I'd add it too. Designed for a single or couple living there I'd skip it. 

1) If there wasn't a benefit to hiring/interviewing people based on their race, but instead their accomplishments, resume and character I don't think we'd be having this discussion. 

2) The media focuses around race-baiting - if anything happens, ah, they make sure to let you know the race! This is a business after all, and they need fundraising!  

Why not just refinance it into a 30 year mortgage?

Re-do your budget with all your income and expenses and see where you sit. 

You should be accounting for vacancy, repairs, cap ex, property management etc. It's not unforeseen repairs, you just didn't budget it - 1275 * 10% = 130/mo so call it $1500/year. These "unforeseen" repairs pay for themselves if you budget it. It would've costed you only $1000 but you budgeted $1500 so you'd actually come out better than you expected...

What does your HOA cover? Water? Sewer? Trash? Yard care?

Just looking at the numbers it seems like this would work for a regular 30 year mortgage. Not a homerun per say but a deal I'd look into. Figure it out soon though, the market is changing fast and condos (at least in my area) are the hardest to resale and see the changes in the market first. That said I steer away from condos locally due to the HOA.

"Is now a bad time to buy?" Interesting question. The trending answer seems to be "never a bad time if you buy right" - I think there's an undertone of caution here. To me it seems like it's not a great time to buy. The prices are the highest. The increase in prices of the last 6 months even has been insane - easily 40% some places, lots of places have doubled in value over the last year. Are there still deals - sure. Are there always deals - sure. Are there a lot fewer deals today than 6 months ago - absolutely. A year ago - even more so. 

For me it's not a "bad" time to buy but it's definitely the hardest time to buy. Even locally, in my opinion.  

Consumer spending was mentioned to be up. Seems good on the surface. But we've also had a massive influx of $ in the economy in the last year. We've had people sitting at home or working remotely. We've had low interest rates that encouraged spending. Now we're seeing a drop. Stock market is down ~20% for the year. We see a pullback in travel 2022 Q1 travel compared to the 2021 outlier (but properties are still priced at 2021 revenue levels). We see some layoffs starting - tech companies, netflix, uber, real estate companies - it's harder to grow a company when you're borrowing at higher interest rates. 

I personally am doing my research and staying ready for a good one to hit the market. But buying at these higher prices before anything has stabilized just seems like making a decision based on changing uncertain data. 

Now I don't have the most experience in up/down markets and a lot of us have only seen an up-market. For me, I'm going to wait a little, see how things start to play out. I see prices either stabilizing or even coming down a bit. 

I have noticed the exact same price trend in a lot of different places. It is very odd. I'm 30 - so most of my investing life (past 5-10 years) has been an upswing, I haven't really experienced a downswing other than the 2008 housing crisis (wasn't into investing then) and really covid (which was more of a quick blip than a recession). I just can't imagine prices increasing like this and staying that high (I mean 40% in 6 months is ridiculous). Investing in a lot of these locations 2 years ago would've been easy - today the returns are like LTR but with the STR risk and workload.

Couple that with the inflation we've been seeing. The influx of money pushed in the economy by the fed. The fact that a lot of people had a lot more disposable income and time at home with covid. A lot of extra traveling since people were home or could work remotely. Increasing interest rates very fast. Increased gas prices. And now we're seeing the stock market really take a fall, down 20% (hard for me not to buy index funds just due to this). We're seeing some layoffs start - it's more expensive to borrow money now so that's going to mean less productivity and more layoffs. The housing data we see is at least a month old because of the closing timeline.  I realize there's more attention on STRs right now but I can't imagine that is the reason for the prices in most of these places. 

And housing prices are at an all time high - we are at the top of the market - a sellers market. 

For me personally - I'll take some smaller local deals but I've gotta steal it to buy it right now for a high price STR. If a deal pops up, I'd say be ready, but I would not be getting into the FOMO and rushing crowd in this market. Lots of uncertainty right now.

I agree that it 100% depends on the person and their goals. 

IF you want to invest in a SFH and pay market price for a house that's essentially been bought, rehabbed and sold to you, by the turnkey company, then managed by the turnkey company - then turnkey may be right for you. They have the support systems in place already. They make profit every step of the way for making it "easy" for you. I get it, it's right for some people, but it's not my style. I find that the ROIs are overestimated because vacancy/repairs/maintenance/cap ex are often underestimated. Good luck getting anywhere close to the "1% rule" with a turnkey company.

Alternatively you would have to build your own team from the ground up. This can be time consuming and difficult but done. Lots of people do it sucessfully, and lots more probably not so much. It's important to learn EXACTLY what you're getting into and maintain awesome contact with everyone. 

I personally want higher returns and I'm willing to have the early headache in order to learn and get better and better until they become easier. 

I go back and forth on this...I can see it both ways though, this depends greatly on the property imo. Condo you have HOA fees, special assessments every so often (this is your Cap Ex budget) whereas on a house you have regular cap ex on your exact property. Condos can have nice amenities as well, but some lower density houses/townhomes have nice smaller amenities with a much lower HOA.

I don't like much about the math to be honest 

- What are you expecting for your occupancy rate and daily rate? Just trying to figure how you get to the 4200/mo. I feel this is a pretty big overestimate 
- Utilities - electricity, water, sewer, internet, lawn care etc - I think $901/year is a low estimate. Is this a house or a condo with an HOA?
- Vacancy and maintenance estimates may be off if your monthly rent is off...I don't like how you estimate vacancy - I personally think it's better to use an occupancy rate and the rate you charge per night
- What does the property management include? Better include cleaning/linens etc at 20%... 

Booking fees? Supplies - trash bags, paper towels, toilet paper or covered by PM?

What's the attraction to come to this location other than football games a few weekends out of the year?

Not the first spot I would pick...but hey there are STRs in my neighborhood in the suburbs that may do quite well lol. I don't know

Gotcha - that was my thinking as well - seems like most of the market data goes back to 2018/2019. 2019 Seems to be the most accurate estimate - 2020 we saw the dip in revenue and 2021 was explosive. The ROI will just be much less now compared to 6 months ago - that's what gets me, the timeframe we've seen this "appreciation"

@Dave Harlan

401k loan to make up the difference?