All Forum Posts by: Julie McCoy

Never bought a new mattress??  GROSS.  I wouldn't dream of keeping an existing mattress, or getting a used one (I believe it is illegal to sell used mattresses - Goodwill, etc. will not accept donations of used mattresses for sanitary reasons, and if Goodwill isn't going to take it, I definitely am not.  When I get rid of one that still has life in it, I give it away on Craigslist).

There are plenty of inexpensive, very well-reviewed mattresses that are available - just do a little searching, you'll find them for ~$300-400.  And all my mattresses get protective covers put on them, as well.

Re: furniture, I've gotten some great dressers, coffee tables, etc. at consignment and antique stores, but anything involving fabric/upholstery I'm buying new.  I'm not risking bringing someone else's parasites, pet dander (or worse), odors, or bodily fluids into my nice vacation rental.

Yeah, sure.  My house is right outside a national park, and over 3 hours from where I live.  I have a local property manager who handles key exchanges and does walk-throughs for a low rate, as I handle all the guest communication/coordination.  I have a housekeeper who turns the house after each stay.  Once you've got people in place to be your eyes and ears, it's no big deal (though I do like going up there every couple of weeks and putzing around and checking on things).

I'm under contract for a second property that's out of state; I'll skip the property manager on that one, and train the housekeeper to let me know if anything is damaged/missing after a guest's stay.

Sure @Kevin D., I'm happy to share what I know!  

Do keep in mind that 1% mark is the rule of thumb typically used for LTR properties - STRs have higher expenses and so really should come in higher than that in general. I've been advised that 2% is a better measure for STRs; my house in Three Rivers isn't doing that (yet?) but it's something I'm striving for in my next STR investment. 1% will bare bones cover your expenses with maybe a little left over. Just want to make sure you have an honest idea of what numbers you'll need for a profitable STR. :)

Completed! I admit the survey wasn’t what I thought it would be - I’m currently trying to buy a house that I WON’T live in to use as a short term rental investment property. I would love a loan product designed for those types of investments. What’s proposed in the survey is definitely interesting and I think there’s a market for it, but it doesn’t fulfill the needs I️ have for a mortgage that considers STR income.

Well, I'm investing further south by Sequoia, no skiing... but my initial thoughts are a) it'll probably be tough to find <$250k that's decent in a ski town (but I haven't researched that niche) and b) you'll want to make more than $1500/mo if you want to actually make money.  $1500/mo might cover P&I, property taxes, and insurance but not your utilities, maintenance, capex, lodging taxes, etc. etc. If you're self-managing I think you'll want a MINIMUM of $2500/mo to break even.  

However, if it's just a means to offset some of your costs for a second home, that gives you a less stringent criteria.  

Another note - Tulare County levies a 10% Transient Occupancy Tax on all short-term rentals.  Here's a link to the county website - it's very easy to register and pay your quarterly tax.  But it's definitely something you should factor into your expenses.  

As I stated before, I would definitely be interested in how your house would do on AirBNB - but I admit it's intellectual curiosity, primarily because I don't expect there to be a high demand there.  So do carefully consider the additional expenses/trouble etc. before you move forward.

Best of luck with whichever course you choose!

Looping in @Avery Carl and @Luke Carl because they own several in the area.  (not sure why I can't tag you, Avery!)

@John W. PM :) 

My STR is in Three Rivers - very close to Lindsay. It's quite a different situation because mine is riverfront and 10 minutes from Sequoia, it's designed to catch the tourist traffic passing through the town, but I'd be intrigued as to what sort of occupancy you'd get in Lindsay. I've occasionally had to look for a place to stay in Exeter and they seem to do reasonably well there.

My thought is - do the math on how many nights/ month you'd need to rent it to make the same amount as if it was a LTR (be sure to factor in the costs of utilities, furnishings, etc!).  Is it reasonable?  If so, push it a little further - would you probably make MORE on AirBNB than with a LTR?  AirBNB is more work, it's a different business model - IMO you NEED to make more for the hassle to be worth it.  People I respect use a 2% rule as their rule of thumb.

If your research shows that the possibilities are good, then IMO go for it - you already own the house, you can give yourself a 6-month experiment or something to see how well it might work.  If it's too much work/not enough money, just turn it back into a LTR.  There will be some up-front costs like the furniture, so just make sure you're okay with that.  

From my own experience, summer is definitely the high season for visiting Sequoia, especially for a property your size that is best suited for families or groups traveling together (mine is a similar size).  Jan-Feb are going to be your really down months.  Keep that in mind if/when you get started - just make sure your expectations (and finances!) are prepared for the seasonal cycle.

I'd be really interested in how it works out for you if you decide to do it!

Julie

@Jon Crosby This sounds like a good thread for you!

I'm sorry you've had such bad experiences with guests and AirBNB!  While AirBNB is certainly imperfect about how they handle resolutions, I think there are some valuable insights here about the necessity of documentation.

Putting myself in AirBNB's shoes, photos and invoices are absolutely critical to resolving disputes and damage/expense claims - otherwise, they would be at the mercy of people who wanted to abuse the system and make frivolous or false claims.  Insurance companies require evidence of damages and expenses - it stands to reason AirBNB would also require such things.

That said, they should be more specific about things such as why the invoices you did submit were not adequate.  I certainly understand your aggravation!

Your experience underscores the importance of me communicating with my cleaning staff regarding photographing any damages they notice, and making sure I have proper documentation for all services (which is not only beneficial for potential claims, but also for tax time!).  There are ways I could be more on top of this, so thanks for motivating me to do it!