All Forum Posts by: Kim Feldkamp

I currently own and manage 2 vacation rentals on the North Shore of Lake Superior - One is a cabin on a lake outside of Grand Marais and the other is a townhouse on Lake Superior.  It is a great area to have a vacation rental - there is definitely a draw for the area but it is very seasonal.   That being said, our townhouse does well in the winter time because it's located close to the ski hill and has amenities people are looking for.  

We've been considering selling one of our properties to purchase another place down in the cities.  If you'd like to chat about the market or a possible purchase, DM me.

Selling a home to a typical buyer is very different from selling an investment property to an investor.  A typical buyer cares about completely different things, which may or may not make sense to an investor.

I just recently sold my house FSBO. I think a flat fee broker is a must - you need to get yourself on the MLS to have the best chance. That will put you on all the popular sites buyers use: Refin, Zillow, etc. The place we worked with offered everything a normal realtor offers a la carte - so you can pick what you want. They also have all the forms including disclosures and purchase agreement amendments for counter offers. They also offered the online booking tool to book showings with the buyer's agent - no difficult FSBO here.

It's definitely important to stage the property and take good pictures but you don't need to pay a professional if you have a decent DSLR and $40 to buy one of those online HDR (high dynamic range) programs, you can get the same type of photos.  We chose to go with a sign in our yard as part of their "a la carte" offering and used a google voice number; I'd recommend that.

I did the open houses and would ask every person that came in for their feedback.  Also, if they explicitly asked me, I told them I was the homeowner but if not, I left them to think I was an agent.  We also followed up with each agent after the showings to get feedback.

I had a website for my home with additional pictures, a walkthrough video and a full list of improvements.  I'd also recommend including some floor plans - there are plenty of online sites that offer software to do this for free. I didn't bother with flyers, I just printed out cards with a QR code for our website and handed those out.

Some things I learned from my experience:  

- Buyer's agents WILL discriminate against your listing just because it's FSBO. And they will also be very condescending toward you despite previous comments here by other agents.

- Realtors like to talk in percentages because it seems like a small sum but convert that percentage into dollars and ask yourself if it's worth paying that amount.

- Make sure your place is 100% ready - don't put it on the market early.  The details matter.

- Pay the typical commission to the buyer's agent.  It's a range of 2.3 to 3%.

-Real estate agents have a vested interest in presenting their value as high and putting down FSBO. If you're an investor, you know what you're doing so make sure they know that.

-Most of the buyers interested in my house found it on their own via one of the many real estate sites and brought their agent in later to make an offer or schedule a second showing.

-You are the only one that can sell the features of your house to a buyer - make sure their agent knows the key features of your house and any chance you get to meet with the buyer, make sure you sell those features.

I'm not saying there aren't good agents out there, I've worked with several.  But there is an elitist/protectionist mentality and I experienced it first hand.  I don't believe that junk about "you should hire a professional, they know it better than you do."  I've completed 6 closings in the last year, I'm not exactly inexperienced.  Our house sold for over asking in a multiple offer situation.

I agree with everyone - gravity furnaces essentially have no moving parts so there's nothing to break really.  There's a gas valve and you need to light the pilot if it burns out but that's pretty much it.  I actually think they provide nice heat too - nothing blowing the dust bunnies around.  I replaced one with a high eff furnace and A/C and it cost about $13K but that was in my own house and I added a second story to it. I wouldn't do it for a rental.  If you want a nicer option for A/C, consider a mini- split, they're great and very efficient.  I'm planning to install them in a duplex with radiators.

Hello All,

I'm about to start a renovation project and am looking for recommendations for an investor friendly Architect in the Minneapolis/St. Paul area.  We're doing an attic conversion in St. Paul and would like someone who's got some experience with that.

Your help is greatly appreciated!

Love this topic.

My mom always told me growing up that I had to go to college. She always told me I had to be a doctor, lawyer, accountant or engineer because there was no money to pay for college and I needed a job that would cover it when I got out.

I chose engineering. I had your typical college experience - lived in the dorms, 5 years of tuition and graduated with A TON of debt. My student loan payments were more than my rent. I got a job in engineering straight out of college and like a dummy bought myself a brand new car. Then The Crash came and I was lucky enough to keep my job. Shortly after came the First Time Home Buyer Credit and I bought the smallest house on the block on a FHA loan. I spent what little money I had to buy and fix up this house by myself.

I quickly realized there’s not a ton of money in engineering but companies like mine liked to turn engineers with social skills into technical sales people. I jumped into sales and have been on that track ever since.

Eventually, I met and married my now husband, @Nich J. who spent much of his early twenties in the Marine Corps. He didn’t have any student loan debt thanks to Uncle Sam.

We both have been employed since our early teenage years and have always had the frugal mindset. Now we make good money at our day jobs and save as much as we can.

When my husband moved in, we decided to add a second story to our tiny little house. We hired someone to build the shell and we did the rest - all of it. The house appraised for way more than either of us ever thought and we used a VA loan to pull it all out. My husband sacrificed 2 years at war in the sandbox to get this benefit and we're not letting it go to waste.

About a year and a half ago we started our REI journey and haven't looked back. In the past year, we've had 5 closings: refi on our house - primary residence, a cabin - vacation rental, a townhouse - vacation rental, a triplex, and a duplex.

We’ve spent ALL of our free time for the past 4 years finishing our house; we remodeled the cabin and the townhouse ourselves as well. The duplex is in need of some serious TLC so we’re renting out our house to move into the duplex and fix it up.

We have had no help financially from family or otherwise. We’ve sacrificed time with family, vacations, fancy dinners, our backs, you name it, to make this happen and we’re not done yet.

The moral of the story is sacrifice, being able to take a risk, and sheer grit and determination - all of this to get to our end goal which is being able to quit our soul sucking corporate jobs so we can use our time as we see fit...which is probably more REI.

@Nich J.

@Deanna McCormick  I'd be interested in your Policy Packet as well.  It sounds like what I've been trying to put together myself.

@Charlie Gruber

Here's a website that will tell you the sales tax in your area: http://www.revenue.state.mn.us/businesses/sut/Page...

I also used https://mylodgetax.avalara.com/ to confirm that info.

@John Woodrich makes a good point about having your CPA confirm this info.

As for how to collect it, there are a few different ways and the Airbnb forums are packed with people upset about this issue.  I started out charging it back to people - essentially adding it to their booking by listing it in the house rules and then going back with an alteration.  That was a huge pain so now I state in the house rules that it is included in the listed price and use the following equation to figure out the pretax rate:  Pretax rate = Listed rate/(1+tax rate)  -- ex.  $160/1.06875 = $149.71 where your listed rate is $160, your tax rate is 6.875% results in a pretax rate of $149.71 and $10.29 in sales tax that you will have to pay to the state.

I've read about people asking their guests to pay them on an app like Square Space as well.  Not to go into too much more detail but my gripe with my current method is that Airbnb charges their fees as a percentage of the total booking so if taxes are collected through their site in this way, they get a cut of it from me and the renter.  Seems messed up to me.

The last thing I'll mention is the cleaning fee, you should charge your guests a fee separate from the rental rate.  It helps differentiate your property from a hotel for tax purposes - I can't find the exact article but this one has some of the info I'm looking for http://www.nolo.com/legal-encyclopedia/tax-issues-...

I would suggest cozying up with a CPA to make sure you don't give away all your profits in the form of taxes.  I'm still working through this.

Hope this was heplful!

I have 2 vacation rentals in northern MN and have looked into doing another STR in Minneapolis. I think both Scott and Bruce make good points - you can definitely make more money going the STR route but I think you should have multiple exit strategies.

Something you're missing on your list of considerations is Sales Tax.  Airbnb doesn't collect that for you (yet) so you have to collect and remit payment to state on a certain interval determined by your gross sales (i.e. monthly, quarterly, yearly).

As far as licensing is concerned, to Scott's point, the city hasn't taken a stance yet but if you're already following to proper rules now, you're more likely to be grandfathered in when these new rules come into play.  I've been working with the MN Department of Health to get licenses on my places.  I have to make some modifications, among other things, but they flat out told me that the new regulations were coming and that because I'm making the effort, they're more likely to grandfather me in in the future.

Make sure you account for furnishing the place - I can tell you from experience, it always costs more than you think.  Also, make sure you find a really good cleaning company - Airbnb runs on reviews and you really need to have a nice clean place to get the 5 stars.

Hello BP Community,

My name is Kim and I'm from Minneapolis, MN.  I've been devouring podcasts like no one's business and finally decided to see what Brandon and Josh are always talking about.  Looks like a great resource and I'm really excited to build on my education here.  For my day job, I manage corporate accounts for my company selling industrial equipment into various markets.

Currently, my husband and I own 2 properties - the home we live in and a short term vacation rental. We just purchased the STR recently and are doing well so far - very excited for the potential here.

We want to get into long term rentals to create some passive income.  Currently, I'm looking at single family homes and small multi-families (duplex, tri and 4plex).  I need to find a realtor to show us some of the properties in our area and am excited to connect with people on this site.

My husband and I have a decent amount of experience with rehabs/renovations being that we torn down and built our Taj Ma-garage and did most of the work on a second story addition.  I do a lot of the design work and GC-ing as I have a background in engineering and basically nerd out over rehabs and building materials.  My husband has worked in the construction industry off and on since he was 16.  He nerds out over finish carpentry - we milled, finished and installed all the trim for our second story addition to match the rest of our 100+ year old house.  We're both obsessed with nice woodwork - it's a problem.

Mostly, I'm just excited to dive into Real Estate Investing. We've been talking about this for a long time and we finally took the first step with our STR and now we want to keep the momentum going.

Thanks everyone!