All Forum Posts by: Kyle Smith

Correct, I would take half of the net profit after expenses. I think it's a fair split and, correct me if I'm wrong, this type of partnership is common in some of the high profit STR markets. The owner gains equity and makes a profit without doing any work whatsoever. I'm sure there are some investors that would take that deal especially in the Smoky Mountain markets. I offer a huge amount of experience in land prospecting, building process and rental market stats. For someone wanting to get into the game, I feel I can offer a lot and help one avoid serious miscues. I know Tony Robinson (Bigger Pockets Pocast) does this very thing and I believe the split is 50/50. I am just unsure how the contracts are structured.

Good thoughts here. Thanks John

I’m considering going in with an investor on a new cabin. I would help manage the construction and also manage the cabin booking, etc. The other partner will own the cabin and take care of all financial obligations.  

I was considering a 50/50 split once the cabin becomes rentable.  Has anyone here done a 50/50 partnership similar to this?

I’m curious, with the financial investor owning the cabin, what would happen if he/she decides to manage it themselves or get tired of splitting the profits?  I’m sure no financial investor would be willing to tie his asset to a non-owner indefinitely.  What if he feels the cabin isn’t performing as well and wants out?  How would I recoup my invested time, travel expenses, managing construction, setup of airBNB tools, and establishing a solid rental base, etc?

thanks in advance….

I’m planning on adding remote electric blinds on my big wall of windows in my new cabin. You might be surprised by how many people might like less light shining in. You could have it where it closes the upper windows and lower ones separately. 

I think you will need at least 2 tankless water heaters and yes, depending on which one you buy, it should handle the same volume capacity as the 2 80 gallon heaters.   Traditional water heaters these days are pretty efficient and the replacement cost may be not worth it.  Also, tankless can have its maintenance issues from time to time.  (That’s been my experience-YMMV)

I think the biggest issue right now is the radiant heat coming in.  Get that under control then you should see some improvement.  It’s just plain hot out there and we can mitigate all we can and at the end of the day, if your clients keep it ice cold in there, it’s going to be expensive.  

1. Tankless water heaters (Check your 120vac service load capacity before taking the plunge)

2. Interior motorized blinds

3. Increase Seer rating on ACs (will take years to pay you back-may not be worth it)

4.  Solar supplementation is expensive and takes years to pay back  

I admit I’m pretty shocked how quickly sentiment has changed in this market. It was like a tsunami of buyers and insane prices were paid. To see this market cool down like it has so quickly is amazing to me. However, I still see 500sqft cabins with no view or anything going for $250k. The sellers are in for a rude awakening I think.  And yeah, who’s going to clean these new cabins coming online?  LOL 

True, they sold for double what they would have sold them for the previous year. One builder told me he sold one for 800k that he built and sold for 400k the year before. 

One thing to keep in mind though folks, I think in the future these cabins will catch up with the cabins in Aspen, Breckenridge and other destination locations like this.   It was heading that way but now there’s a pull back. I think once the economy gets back on track the prices will exceed early 2022 prices and it will start to catch up.  That’s just my opinion though. Like Collin says, the long term investor will be good to go. 

 Yes, things move slow there.   I’m seeing 1-2 years to build after you close on your construction loan. Some builders are anywhere from 6 months to 1.5 years out to even start.

 Right now this is what I’m seeing:

1. 3-4 months minimum, possibly longer to get a survey (you need 2-3 phases of survey from the moment you close on construction loan through the foundation build)

2. I’m not sure how backed up the county is but probably 1 month for a perc test. 

3. Foundation block is 2-3 weeks lead time

4. Concrete is 1.5 months lead time (and you need at least two bookings for concrete-one for footers and one for the block pour)

5. Trusses are 9 weeks 

6. Windows are 2-4 months lead time

7.  Cabinets are minimum 2 months

And the list goes on.  

I’m 5 months into my cabin build and my foundation is at least 4 weeks from completion and I haven’t even put up a single framing board.