All Forum Posts by: Kyle Jensen

Investment Info:

Condo buy & hold investment.

Purchase price: $150,000
Cash invested: $40,000

We have long term rentals and have flipped a few houses, but this is our 1st attempt at a short term rental! We purchased a 2/2 condo in Banner Elk, NC in December 2021 and began full renovations in January. The property should be be ready to rent in May. Looking forward to the new adventure.

What made you interested in investing in this type of deal?

We visit western NC a few times a year and particularly love Banner Elk, NC and the year-round activities. We started looking for properties early last year that we could turn into a full time short-term-rental.

How did you find this deal and how did you negotiate it?

We worked with a local agent and found this deal on the MLS. It's a hot market up there, so there wasn't much negotiation, but with a cash purchase, we were able to get a slightly better deal.

How did you finance this deal?

Private money for the purchase, and HELOC funds for the rehab. We will refinance into a 30 year fixed mortgage after the renovations are complete.

How did you add value to the deal?

We are renovating the property to include a new kitchen, 2 new bathrooms, flooring, paint, and a mini-split HVAC system.

What was the outcome?

The renovations will be complete next month and then we can begin to rent via Airbnb, VRBO, etc.

Lessons learned? Challenges?

Managing a full rehab from out of state has it's challenges, but good communication and clear expectations are critical!

I just went through the same debate with a property we purchased in Banner Elk, NC this year. It did not have AC previously, and although the summers are "mild", there were a few trees that were recently cut down in front of the property (to open up the view), but there will now be very little shade from the direct summer sunlight. We decided to bite the bullet and have a mini split system installed in the main living area and both bedrooms. We will be managing this STR remotely, so having the ability to control the temps remotely was also a selling point for me.

Check out NJ Luxury Granite and Marble. They are always very quick for me. 

Hi Jeff. Send me a message and I'd be happy to share more about the deal we are working on. In general though, I'm looking for a 20% COC return. Yes, values are up compared to the most recent years, but if the return is there, the deal makes sense. Don't get hung up on what a specific property was worth a few years ago. Look at the return it will generate and the long term future outlook. I hope that helps.

 We will have to do some renovations (kitchen, flooring, paint, etc) and we are talking with a few contractors in the area now. If you happen to know of someone in the area, please message me. Thanks! 

Same here. We are under contract on a property in Blowing Rock and would love to connect with others in the area who are operating short term rentals. We are also looking for recommendations for contractors and cleaning crews. Sending request to join the Facebook group as well. 

When possible, I too love to be on site for the inspection. Of course there is benefit in talking with the inspector and asking questions, but I also like to use those couple of hours to put together my detailed scope of work for my contractor. Leaving the inspection appointment, I should pretty much have a finalized scope of work and renovation estimate (if there were any meaningful changes from initial walkthrough estimates). 

We closed on the refinance this week, so for those interested in seeing how the numbers worked out on the refi, here is the final result. 

After the 6 month seasoning period, we were able to refi into a conventional 30 year mortgage at 75% of the new appraised value. 

The house appraised for $200k which far surpassed my conservative estimates! Rather than max out the loan amount at $150k (75%LTV) we decided to use a value of $175k which equaled a loan amount of $131k. We made that choice because it allowed us to pull all of our money out of the deal and still keep a nice monthly cash flow. We now have our cash back (minus transaction costs, etc) and the property cash flows about $350 a month after reserves (vacancy/maintenance/CapEx).

All in all, this ended up being a great deal that crushed our expectations! I hope the updates throughout the life of this deal helps anyone out there trying to get a better feel for how a BRRRR can work for you. If you have any questions, please feel free to reach out.

 Hi Carrick - I’d say you want to pay close attention to the school districts and proximity to San Marco. Some parts will have prices of $300k and up and others just a few blocks away will be half of that. It can be street by street though and really pays to have someone familiar with those nuisances. If you have specific questions, feel free to send me a direct message. 

Rental market is hot. 6 days from posting the listing to having a signed lease in hand. Well qualified tenant and $1325 in rent. Always nice when you beat your projections!