All Forum Posts by: Ryan Moyer

It's worth noting that most people do this wrong on their taxes, or at least that's what I was told by my STR-specific CPA.

Airbnb reports your pre-fee revenue to the irs, NOT the payout amount.  Of course if you just report your payout amount (which already has the fee taken out) you'll still pay the correct amount of taxes, but the Airbnb revenue you report in that case will not match the Airbnb revenue that Airbnb is reporting for your account, which could throw up a flag.

IE if you make $10,000 in revenue (nightly rate + cleaning fee) and get $9700 in payouts after the 3% fee, Airbnb reports that to the IRS as $10,000 in income.  So technically to match you should be reporting it as $10,000 income with $300 in expenses for the fee.  If you report it as $9700 income with no expense for the fee it still works out the same in the end, but the income number you're reporting will not match what Airbnb is sending the IRS.

EDIT: Not financial advice, this is just what my CPA, who works mostly with STR tax returns, told me.

For bath towels...

I use these for my nice-ish property where towels actually last.  They're not anything special, but just a little better than the super basic towels: https://www.amazon.com/gp/prod...

For my Disney property, where guests lose towels by the dozen (the area is notorious for it), I just get the basic Sams Club ones that are $29 for a pack of 6.

If I take my hours I tracked for material participation (not exact, but the best measure of time spent that I have available) my hourly rate for running my STRs was around $280/hr.

I am more hands on than most (don't mind getting those extra hours for material participation and the tax benefits along with it) so I would imagine others that are cash flowing well and only spending a couple of hours per week are able to claim much higher per hour.

To answer your last question, there are various ways managers can structure fees but BY FAR the most common is that the host/manager takes a percentage of revenue as commission.

> 70% is definitely doable, but probably not at the rates you're hoping for.  Rates have been trending down in the area since the covid boost finally started to level off, while home prices have not.  It's a great market long term, but that's kind of the rub right now. 

I do > 90% on the one I own but it is heavily themed.  Theming is the key here.  There is an unlimited supply of nice homes and that leaves nothing to compete against each other with than price.  I have a client that had a hard time accepting  that his 6br home might rent for under $300/nt at times.  It took showing him that there are 9br homes in the area renting for sub $200/nt from some desperate owners to drive the point home.

It's a vacation destination which means it will always be a strong STR market. But you need to mentally prepare yourself to possibly not cash flow for a while if you're not very well themed.

I'm a professional fine art photographer (ryanmoyer.com, free plug!)

As others have mentioned, there is a LOT more to it than just having a nice camera.  You are headed down a path of a lot of learning, though if you're willing to put in the time maybe it will be worth it to you.  Just note that real estate photographer is going to throw a lot of stuff at you like distortion and very uneven lighting (windows) that are going to wreak havoc at first.

The reality is with 4 STRs and 5 years of STR experience YOU are one of the veterans here.

80%+ of the replies you get here will be people with less experience than you.  100% will be people with less experience in your local market than you in this case.

This forum is great for discussion but I would never trust major financial decisions based on someone on a forum online. The reality is that once you mention spending money, 20-40% of the replies here will be realtors, lenders, and managers whose livelihood is dependent on people like you continuing to buy. Many of the same type that last year were saying "of course should offer $200k over asking price with no contingencies, this amazing STR market is just the new normal!".

I have the buying itch too but it's a good time to be careful and underwrite VERY conservatively.  Remember, we haven't even gotten to the hard part yet.  This is just saturation.  We haven't even seen what things will look like if travel demand (which is still at unsustainable record highs) actually starts to level out and return to normal.

There are a lot of good realtors, and a lot of really good investors on this forum, but just be careful.  To further @Collin Hays's stock market example, a lot of the advice from realtors (who got a taste of a new lifestyle over the last 2 years that they are desperate to maintain) telling people that this is the perfect time to buy because you can finally negotiate again and don't have to offer way over asking price remind me of the fund managers telling people it was a great time to buy Peleton stock at a "discount" when it dropped from $120 to $105.  Of course the reality was that the REAL pain hadn't even started yet (it's all the way down at $13 now).

No one knows what will happen and maybe travel will stay forever resilient, but a catastrophic drop in occupancy rates and home prices that make the current "hard times" seem like the really good times is still a very real possibility.  Again, all this hubbub over the last few months was nothing more than supply growing faster than already outlier travel demand continued to GROW.  Imagine what would happen if travel demand actually starts to drop alongside this massive supply increase.

 Airdna is an algorithm so not really capable of being conservative.

Isn't Airdna data based on the trailing year? That's why in recent history (when most of the people in STR entered the space) it was so overinflated, because it was using inflated covid data. Now as those inflated metrics start to get further into the past they no longer affect the algorithm like they did.

Here's a thread with good discussion about this from a few months ago: https://www.biggerpockets.com/...

 Airbnb and VRBO both report cleaning fees you charge as revenue so you still have to add the cleaning fees paid as a deduction on your taxes.

IE $1000 booking with $250 cleaning fee is reported by Airbnb/VRBO as $1250 revenue, so you then have to list the $250 paid to the cleaner as a deduction.

Yes certainly tax deductible.

To get a total on VRBO go to Reservation Manager -> Financial Reporting.  Then filter by the dates and click download to get an excel file.  The field for fees I believe is labeled "Deductions" in the report.