All Forum Posts by: Mike Eichler

I actually just made a post on this

You can check it out here

Hello Bp, 

I wanted to hop on here and write about what I have seen in my backyard STR market in the Pocono Mountains of Pennsylvania. For Transparency and details on my background, I am a licensed realtor in PA and work in property management of over 110 STR properties in the Poconos Market. I often hear people saying that Airbnb is dead or that it's not what it used to be. 

My initial thoughts are, how is this true? Just remember, its easy to get caught up in finding value. This is a mistake my mentor and I made early on. Going for the 4 bedroom home thats priced in the realm of 3 bedrooms. Big win right? Not always, and in fact with STR usually the opposite. I'd rather have the 2 bedroom priced like a 3 bedroom. Why? In order to be in the upper echelon of available listings, or reach occupancy and rates above the average Joe, your listing needs to reign supreme. Be honest when buying the home, is this somewhere you would be excited to book and stay? Your thinking must align with the travelers, and often experienced-based thinking will take you much further than value based.

So, let's say you are looking to enter the STR market and don't know what to look for in a winning home. (Remember that I work in the Poconos market, so your market may differ slightly.) Firstly, you have to consider the price point. For the Poconos, I like to explain homes here in three separate tiers. (These are not in order of how profitable they are, it's just used as a way to separate them for explanation purposes. )

The first tier of homes are 1-2 bedroom homes these are homes that are tailored ( or should be) toward couples or small families and can range between 100-250k. The second tier of homes are your 3-4 Bedroom homes priced between 250-400k. This is the tier that you really need to be careful of, which I will explain in more detail later. Finally, your third tier of homes are your 5 Bedroom+ Large Cabin homes priced in the realm of 400-700k.  (There is also a fourth sub-tier of A+++ properties which includes your awesome lakefront homes and 7+ bedrooms at 700k - 1 Million. ) 

In the Poconos market, we have been seeing homes that are smaller or larger be the better performers.  I believe this is because of the sheer lack of inventory of 1-2 or 5+ bedrooms.  The beauty of the smaller is that this market is historically a "vacation market" and a couple's getaway market and that has not changed.  With small homes you get quick and easy stays with fewer issues, cheaper cleaning fees, higher occupancy, and still great rates.  The Larger homes tell a different story, these are more expensive purchases but allow for large groups to travel together and more importantly for you,  split the bill together.  With a large group of say 16+ guests a $2000 or $5000 weekend is much less expensive when multiple parties are paying.   

To summarize, STR is not dead to the ones that treat it like a business. When run like a business from the beginning, choosing the right house at the right price and furnishing correctly, then adding the right amenities according to your market, you will do just fine. Also remember that Real estate is a long-term play so even if the cash flow isn't a "home run" right now you can refi later and hopefully even pull out some equity you can put down on another one, bringing you closer to financial freedom.

Thanks for reading BP!  

-Mike Eichler 

~Realtor and STR Property Manager~

Also, DM me, I'm always happy to help investors looking to enter the Poconos market, and I'm available for STR questions.

If it makes sense to you and you take the proper steps to screen them, then I would take it. Its relatively low stress and depending on how seasonality is in your market could be nice to secure it during the slow time and then get back into the swing when it starts to heat up again. Especially if they stayed with you before leaving less risk. Just avoid "doing them a favor". and renting for much less than you could if you kept it STR, its a longer term so of course its going to be discounted a little, but remember its still a business at the end of the day.

Hope this helps, let me know if you have any other questions!

Most likely your local regulations detail out what their definition of STR is. Typically is a rental of less than 30 days. So depending on how the lease in place is written, you could change it to match what best helps you. You could always write up a 6 weeks and credit back any unused rooms during those weeks if its better for you to be considered Long Term.

Hope this helps, let me know if I can answer any more questions.

-Mike 

wild.

Hello BP, 

I'm beyond excited to share with you how the renovations are going at my team's 43 Unit Resort in the Pocono Mountains in  Pennsylvania.  Here is a little backstory on how we got here.  One day our team is sitting around a table deep in work when one of our teammates sends a link to a listing in our group chat.  He looked up and jokingly said, "What if we bought this."  next, someone chimed in, "We can actually do that".  Having no clue how this could actually happen, we got to work.  We ran numbers and, from there, got in contact with the owner and next thing you know we're under contract.  Next, we just needed the cash to do it, which we did not have. So we raised it.  

The dream comes alive, the "Elements Resort." When we bought the property, it was strictly LTR units. The units were all occupied so we devised a plan to move tenants out as their leases ended and renovate their units. We bought the property in December 2022, and since then, we have renovated 15 of the proposed 27 STR units. I will let you be the judge of how they turned out.

Below you will find the Before pictures of the units -----------> You can find the current Airbnb listings here, post-renovation

Thanks for Reading!

If you can keep it great. If you think the money would be better used elsewhere sell, OR you can refinance the property and rent it, using the new pulled-out cash to buy anither property that you an LTR or STR or live in it, not sure what your plans are.

If you can keep it great. If you think the money would be better used elsewhere sell, OR you can refinance the property and rent it, using the new pulled-out cash to buy anither property that you an LTR or STR or live in it, not sure what your plans are.

If you want to pull the cash into something else, you could refi and rent.  With interest rates right now I know that isnt the most attractive option, but just a thought. 

Huge Airbnb fan here, if you run the numbers and they make sense then go for it.  1031 is an amazing strategy to defer taxes.  Possibly try to see if you can find land with pre-existing septic and electrical to cut down costs would be my suggestion, but not the end of the world if not. 

Hope this helps, let me know if you have any more questions!