All Forum Posts by: Justin Anderson

1. The only reason at all to use hard money for STR would be if you can't qualify normally. Otherwise you're just paying a higher rate for nothing.

2. Your lender can help you walk the line between second home and investment property.  Most can get you into a 'second home' to take advantage of the lower rates you'll see vs an investment property loan.

3. I wouldn't care about discounted properties at all... I'd just go for whatever would make the best return.  (And as an aside, many markets have stayed the same or gone up -- there aren't as many deals yet as you'd hope)

4. This is a personal preference. I generally keep very little reserves and pay for repairs out of cash flow across my rentals. That could bite me if the pandemic shut things down for a couple of months. Most suggest having 3-6 months in reserves to handle big repairs without worrying. Look up 'cash on cash return' to see what your ROI would be. Basically you take how much cash you put in to acquire the property and then look at how much you get out in cash flow. Figure appreciation, depreciation and equity gain in if you wish.

5.  Yes, very much so.  Just read through these forums to find stories about cities you want to invest in.  Places like New Orleans and Vegas and NYC aren't as friendly as places like Pigeon Forge or Branson.

6.  There are a lot of tools and this is too broad of a question... Tools to help you send emails, tools to help you file taxes, tools to help you set prices, tools to help you manage lock codes.  Lots of study ahead!

7.  Yes.  Read a lot on here so you don't make mistakes.  A bunch of us have plenty of horror stories to share!

I'd look at insurance rates and regulatory challenges you may run into.  Those are big impact items that people can often forget.

After that, I'd look at occupancy rates and how they'd differ between the two.  Happy butts in beds is what gets you paid and if you're looking to cash flow, that's critical.  Galveston will probably get you more per night for the same house, but I imagine most stays are weekend stays.  The lake house may get more family vacations and mid-week stays.  (Just guessing by how my family travels)

There are some Galveston folks on here that may chime in with actual hard info.

Haha!!   if only they people knew how a 4* affects your listing, they'd be a touch forgiving.

I would have so much fun replying to that one, though.  Some humor with a touch of snark lets guests know some expectations and lets you vent a little bit. 

They do in some jurisdictions.  For example in Pigeon Forge, airbnb collects and remits around 9% of my overall 12.8% tax rate.  (They leave out local taxes of about 3% plus a business fee of around .15%)  VRBO collects zero of them and I set it manually to collect and pay.  (Numers slight off since I'm on mobile and it's from memory)

It's a mess and worth the $20/m Avalara charges to compute and submit it.

Something else to add...  You can ask for parents to be co-signers and/or get all occupants on the lease.  After all, kids can be flaky but someone responsible will worry about their credit score for late payments or damages.  :)

It would depend on your location.  At my university there was summer school and people would either sublet or rent for those 3 months.

Do you allow instant bookings and still get these requests?  

At the top of my listings I say something to the extent of:
"Our calendar is updated in real-time & nightly rates are accurately displayed. Simply enter your desired dates and click 'Book Now!'"

I don't get many last minute requests at all, but I only use the OTAs really.  I do get requests for changing up the check in/out times which I try to honor.  I'm able to head off a lot of those after some changes to my email templates to set expectations, thankfully.

I tell people 10AM checkout but the standard in my area is 11AM.  This allows me to "give in" an hour with no consequence.  I'll generally check with my cleaners to see if they can juggle their schedules and allow an even later checkout and 90% of the time they can accommodate it.   I don't mind asking if they request it but never do it proactively. 

I always proactively let them know if they can check in early, either due to cleaners being done sooner or the place already being empty from the last stay.

I'll just add one tip to your initial post...

"We typically can't allow early check ins just due to giving our cleaners proper time to get the cabin ready.  But I'll let you know the moment it's ready for check in.  If you happen to hit town early, I suggest you do XX YY ZZ."

I give my cleaners access to my messaging system and as soon as the cabin is ready they send a templated message to the guest letting them know how 'awesome' the cleaners were and their cabin is ready.  Of course I'm CCd on the message so I know what's going on as well.

I feel you for the high maintenance guest, though.  You know already how the review is probably going to look.  :/

It's what ever you two agree is fair.  There isn't a right and wrong here.  I'd argue that your equity is equal to whatever contribution you've made per your agreement.  So in your example, you'd own 10% after year one, 20% after year two, etc.