All Forum Posts by: Jon Martin

I don’t doubt that, 18 years is 18 years . . . although it does show that the high value competitively priced infrastructure is likely to already be in place. 

No experience on the acquisition side but I was there as a tourist in 2005. Even back then there were a lot of high rise hotels where you could get a decent condo-style room with hot water, cable tv etc for really cheap ($15-20USD/night). Seems like it could be hard to compete with that, you would really have to make it stand out if you want to justify a higher price. 

Next week I am planning to do some extensive year end cost analysis on my expenses so I can figure out how much is going towards cleaners, toilet paper, coffee, misc expenses etc. Can I count those hours as Material Participation? 

To be clear, this would be for an STR where the goal is to show an active loss (with cost seg/Bonus Depreciation) against W2 income. Thank you

Whether or not a unit is seller financed is irrelevant in regards to STR regulations. STR regs are set by the county and/or city first and foremost and apply to all properties within that jurisdiction. HOAs can also restrict them at any time with no recourse for the property owner beyond joining the HOA themselves and attempting to change the rules.

Are you saying that the HOA is $4K monthly or annually? A $3100/month mortgage in Santa Monica with an ocean view sounds like if you mean annually but if you mean monthly, no thanks.

How many points?

Occupancy requirement?

This. To expand on this for the OP, new construction typically has a single great room that combines the living/family, dining room and kitchen, therefore not a lot of space to add new bedrooms. Whereas mid/late century homes often had a family room, living room, formal dining room etc and in some cases very generous dimensions. Much easier to create new bedrooms out of existing floor space with old construction, which is especially important for STR. Also tend to be on larger lots closer to amenities, while new construction tends to be further out and on smaller lots.

Lately I have seen some nice new homes built within existing neighborhoods that has more bedrooms and bonus spaces, however they are priced accordingly and tend to be significantly higher than the value of the surrounding homes. 

If they are out of the house I would count my blessings and move on. Could be worse, and it sounds like you are within your rights to pocket the security deposit. 

Wouldn't hurt to attempt to collect, even if it's just to establish fault on paper in case they try to come back at you. Realistically it sounds like a lot of time and bandwidth would be devoted to a low likelihood of being made whole. 

@william anderson is a good resource for this area https://www.biggerpockets.com/users/williama325

Short version seems that Biloxi is heavily regulated but the beach towns to the west (Gulfport, Long Beach, Pass Christian) are more relaxed. 

Cheyenne WY would fit this strategy as well I imagine. Plus it's on a major freeway

I 100% agree with what @Travis Timmons says above, his journey described above mirrors mine a lot, albeit his numbers look a little better haha! I did a value add on my first property that got out of hand but now does well. Recently went into contract on my second that is mostly a facelift with room to add 2 bedrooms into existing floor space, which should be possible for <$25K. I don't even consider anything that can't fit at least 4 bedrooms, your competition shrinks dramatically at 4+ bedrooms and your revenue potential hockey sticks. I also look for game room space. 3 bedrooms that can't be expanded are the squishy middle because it's too big for a couple and is priced higher accordingly, yet is also too small for more than 1 family. IMO you are better off with either a small 1-2 bed unit that is easy to clean, economical and is great for 1-2 people or a 4-5+ bed property that fits lots of people. Which isn't to say that a 3 bedroom can't do great because many certainly do, but for that money it is a small premium to get 4+ beds with much more potential. 

I would also emphasize that you may want to keep your vacation and businesses separate. With personal use you are taking money off of the table by taking the space of paying guests, especially if it's high season. The exception to this would be if you plan to retire there eventually and/or you enjoy being there during the slow season.