All Forum Posts by: John Oden

A multifamily (condo) property is a negative in my opinion, because too many other people's problems can be come your problem: 1) potential noisy and disruptive guests above, below and side to side. Your guests can create noise problems up, down, left, right. Parking can be an issue - how to get the guests through the gate and into the proper parking spot. Guests above create a water leak situation that rains down on your guests. Your unit creates a water leak situation for the owner below. 

Regarding maintenance, the only benefit to a condo is the roof, and possibly (but most likely not) windows. You are still responsible for all mechanical systems within your unit - plumbing, electrical, HVAC, so no condo benefit there.

Condos are in many cases are on the beach, which in my opinion attracts the party crowd. We only do single-family homes. Our homes are located in desirable areas near the beach, but not on the beach. We use pricing and high-quality properties to screen our guests before they ever book. It has worked out exceptionally well for us. Many folks do well with condos - just offering an alternative opinion.

Hi Deena,

I don't have any realtor contacts in the Sarasota/Bradenton area, although I do have a few up in the Tampa Bay area. The agent that I mentioned in my post is an insurance agent in Sarasota - I should have made that more clear. 

For anyone needing insurance, I highly recommend Tad Cromley of Insurance Options of Florida in Sarasota. He writes all my policies in our Clearwater area properties, and I suspect he would be able to handle anywhere in FL.

Good luck with your investments!

John

We're not in Bradenton/Sarasota, but just up the road in the Clearwater area. We started buying in 2015 and have four properties now, last one purchased a couple of years ago. We'll be purchasing another fairly soon.

Red-hot is an understatement of the current market conditions. In our little enclave it's rare to see a For Sale sign. Property owners have realtors and investors calling, texting and even knocking on their doors and making offers on the hope that owners may consider selling. It's rare to ever see a For Sale sign in the yard on anything investment-worthy.

Florida is reasonably pro-business and STR friendly, but be aware of local regulations.

Also be aware of insurance costs and property taxes. Some properties are eligible for coverage by Florida Citizens Property Insurance Corp, which is guaranteed by the state. Older properties (like mine) are not eligible and have to be covered by surplus lines which means if your insurance company gets wiped out by a mass of claims due to hurricane and flood - you're on your own. Even best case, if you have a loss with a surplus line company like Tapco, you'll likely not be made whole. My agent is in Sarasota and is a great guy if you need a contact. Also be aware of your flood zone and potential need for flood insurance. 

Carefully project your future property tax expanse. Be aware that the current property owner's tax rate could be protected by homestead exemption and is not indicative of what your tax rate may be once you purchase. One of our properties was paying a little over $1000 annually in property tax. Our tax bill on that same property is now over $5000 and is likely headed higher now that the county assessor has seen the renovations we have done.

The west coast of Florida is a great place to be - just beware of some twists and turns you may not expect.

Good luck with your investments!

John

@Hans Baldau

Welcome to the STR game! As others have noted, it isn't for everybody and Nashville would have shut it down long ago if it weren't for the TN State Legislature stepping in. Sounds like you are properly permitted - protect that permit at all costs. Our local government is always on the lookout for any reason to snatch it away.

You are wise to make sure your investment also works as LTR if it comes to that.

Best wishes and good luck with your investment!

@Michael Baum Just saw your link - thanks for that!

@Bo A Vanecko Agree with @Luke Carl and  @Michael Baum - no Sonos and no soundbar. We do put HDTVs in every bedroom and living area, but no one has ever mentioned a need for better a better audio system for the TVs. I definitely agree with keeping it simple. 

We have placed some inexpensive portable bluetooth speakers in some of our properties, which guests appreciate. The problem we have is that the USB charging cables for the speakers either get lost or walk away. Has anyone found a workable permanently-mounted and AC-powered bluetooth speaker system? 

Cheers and Happy New Year!
John

Managing remotely is very doable. I self-mange one short-term rental in my home market, and several more that are 700 miles away. Finding an exceptional housekeeper is task #1, closely followed by a good handy-person who can take care of the relatively minor repairs, and help refer on the major stuff. From there, its just a matter of doing excellent guest communication and marketing, which can be done from anywhere.

 Hey Mindy, 

 We communicate similarly with our guest.  Our wording is polite but clear. We let them know that on many days we have other guests arriving on the day of their departure so we need that time for our housekeepers to make everything beautiful for the next guests. 

 We communicate this early on, so it’s never a surprise.

Cheers!

Most municipalities have their ordinances posted online, so that would be the first place to start. Also, placing a call (good luck) to the codes enforcement office of the jurisdiction in which you are contemplating an investment. There are multiple levels - State, County, City...so unfortunately there is no easy answer.

And the bigger unknown is what regulations may come to pass in the days/weeks/months after you close on your purchase.

This is such a fast-moving space that your best defense is to make sure that you aren't underwriting your investment on STR revenue alone. Make sure it also works as a LTR, fix and flip, etc.

If you find a market that is clearly pro-STR, then its likely the numbers will be thin because the market has already factored that in to the price of the properties. You're likely buying at the top of the market, and the downside could be ugly.

STR is a great biz model, but not the most stable. Make sure you have multiple exit strategies, in case STR goes sideways.

@Steve Frye Thanks for your correction re NOO permits set up as LLCs. I had OO permits in mind when I posted.