All Forum Posts by: Julie McCoy

@J Brendan (not sure why I can't tag you) - it's good that you're reading up on LA restrictions on STR, you'll need to be very familiar with them before you embark on this journey. Also, be aware that if you have a rent controlled apartment, you may not use any part of it for STR, to the best of my knowledge. The other thing to look into is the apartment/lease restrictions - do they allow this kind of scenario? Will you qualify to be the only person on the lease without disclosing this additional income (which they likely won't accept anyway because it's speculative)? If they don't have anything written in the lease about whether or not it's allowed, are you willing to take the risk that they won't be pleased if/when they find out about your overnight guests?

My final comment is, while I agree K-town is a great transit hub and very walkable, do consider that parking in K-town is IMPOSSIBLE.  You'll want to be clear about the parking limitations with any guests.  I would address these concerns before worrying about 2BR over 3BR.

@Michael Baum It is my experience with Korean culture (and many Asian cultures) that shoes are not worn inside. Careful what you disbelieve if you do not know.

@Account Closed Any reason why you're set on buying an STR in your particular town? I ask because I regularly sell vacation rental properties to out of town investors that will gross $45-65k in revenue for half (or less) of $900k, purchased with conventional financing. The numbers you cited are not exciting to me; by the time you allow for your maintenance, Capex, pay utilities etc. as you should allow for with any investment property, I don't even know that it would make sense as a long-term rental.

The other element is: you would be buying a business.  You would have guests *in your house* pretty regularly and you need to consider all the ramifications of that: coordinating cleaning for four different rooms, what spaces are shared, which are not, access, rules, etc. etc. etc.  

Any kind of B&B setup is not my cup of tea in any case, and you may have a different attitude towards it, but regardless I'm pretty sure running my four cabins is less hassle than running four rooms out of my home.  

Ugh okay that is super annoying.  I'm dying to get up and running with Lodgix but a lot of their tools - like integration with Pricelabs - only works when you have 5+ properties on their system, and my fifth property won't be online for a month or so yet.  

There is an organization in LA that will help you navigate the permitting process and provide some advice/guidance *before* you go to the permit offices and let the cat out of the bag.  I think they mainly help people determine if unpermitted additions can (likely) be made legal or not, but seems like they could be useful in your situation as well.  However, I cannot recall their name, I'm afraid - it's been a few years.  But hopefully knowing they're out there can point you in the right direction!

@Nikki Closser I'm a vacation rental investor and so that's my bias (in my market we took a relatively brief hit from Covid but are now back better than ever), but I have to say, if you have the opportunity to take the gains free and clear (consult your CPA) I'd say cash in.  Who knows what the market is going to do over the next year or two with everything that's happening, but since it seems you'll be able to take the gains no strings attached, I'd say do it.  Maybe Seattle will appreciate more, maybe it'll slow down or even go backwards for awhile, but if you're not cash flowing in the meantime it sounds like that's a gamble that's more trouble than it's likely worth.

 There are entire threads on that topic in this forum. :)  I am mostly referring to communications (with guests, housekeepers, etc) happening automatically.

@John Williams I've been fortunate enough to escape any major catastrophes so far, but here are the things I know are important:

1) KNOW YOUR MARKET.  That means regulations, demographics, what's the competition like, what properties are most in demand, how much can you expect to gross, etc.

2) Develop systems. This will take owning an STR from being a second job to being something you barely have to think about.

3) Have cash reserves. That will save your bacon if something like the Covid crisis happens and shuts down STRs for a period of time (or even if you just have a one-person crisis that means you can't rent your STR for awhile).

Honestly, I don't even do it with my own rentals, LOL - I have my payouts set to be sent to me the day after guest check-in, because I only want money going IN my account, I never want it coming out due to guest cancellations etc. (and after this April boy am I glad of that choice)  I never want to have to worry about having spent the advance payments and then when a slow booking season hits, have to worry about the flow of money keeping up.  And honestly I never want to have to go back and adjust my books for cancellations once money comes in.  

I know there are people who have their own reasons for wanting to receive the money at booking, but for me, I am 100% content to let the OTAs hold it until check-in and be my "escrow" for me.

 This is exactly why, even though I am a licensed agent, I will not get the additional licensing to manage other peoples' property.  I do not want to keep up with all the required bookkeeping/escrow accounts, and I *definitely* do not want to play fast and loose with other peoples' money!

@Arlan Potter I'll take this over AirBNB screwing me out of five figures of revenue by unilaterally deciding to refund my guests in full.