All Forum Posts by: Matt I.

I wish I could make 45k designing an ADU. Agree with the rest- find another architect

I say it depends heavily on your market. I was living in Central NJ before I bought my first buy and hold live-in rehab. Home prices and property taxes were way too high for what my salary was at the time. I switched my target market to Philadelphia and purchased something for $160k. With my 3.5% owner occupied down payment + closing costs (don't underestimate closing costs) all I really came out of pocket was around $20k to purchase. 

This was in 2018. I lived there for two years while doing light cosmetic upgrades. Rented the spare bedroom to some friends in college to help with the mortgage (and to fund the projects). Now its a healthy cash flowing rental and I have a ton of forced equity.

Moral of the story is, I could have sat in my market of Central NJ for a while and not made any moves, since I couldn't afford anything. In most of those markets, I would have needed perhaps double of what I spent in Philly- not only for the purchase price, but also my monthly expenses. If you're in a pricy market, and willing to relocate and change your lifestyle, the $$$ you need to start can be flexible! 

To maintain a credit card balance and build cash reserves, or keep my $ cash low while aggressively paying down debt?

My goal for this year is to save $$ and build a healthy cash reserve. For years I've been in the habit of keeping my 'bad' debt as low as possible. Credit cards, car loans, student loans, other large financed items etc. 

After purchasing my third property in December using 100% leverage (used a HELOC for 20% downpayment, mortgage the rest) I may be slightly overleveraged. This recent property purchase had a few big expenses right off the bat. At this point my HELOC is almost maxed out at $50k, and I have a CC balance of $4,000 +/-. Other than that, I have a small balance for student loans and an HVAC system that I financed. (car is paid off)

Is it better to just hold some of this debt and let it accrue the interest, so that I can build cash reserves? Or keep the cash balance in my bank relatively low, and aggressively pay down the debt to minimize the amount of interest I pay. In the second scenario, I suppose my access to debt would be my emergency reserves. 

As a background I have one single family LTR that cashflows, my primary residence that I'm rehabbing, and a STR that is (finally) starting to cashflow. + my W2 employment which I believe is pretty stable. My credit fluctuates between low 800's and high 700's.

I took everyone's advice and drove out there 2 weeks after making this post. I had 5 days to do as much as I can before my next guest arrived. In this time we (my friend and I) added all new vinyl flooring, upgraded the bathroom, bought a ton of furniture and artwork. It was the longest 5 days ever, working 12-16 hour days, but here are some of the final professional photographs. There is still plenty I could do but this is a huge upgrade from what was there. Thanks everyone for the input.  

Jimmy can you elaborate on the 'a 1 star review will not kill your business'? I feel like all I read about is quite the opposite. I get the impression that a 1 star review is the STR kiss of death, business suicide, etc etc. Do you have a personal account on this? I just opened my first STR so I'm just curious, thanks!!

 No kidding, why do you think I'm posting about this issue in the first place?  

 Thanks Jonathan. My target market is outdoors enthusiasts- fishermen, hunters, ATV/snowmobile riders. That's what the area is known for. Some of the comps offer inflatable floaties for the river, kayaks, canoes etc. That's the kind of stuff that I probably should be looking into purchasing. 

@Paul Sandhu agreed, its not a great policy.

@Joe Garretson I also use airbnb frequently and agree with all this. I'm hoping to get out there soon to get everything sorted out. I've heard about the long term damage that a STR can experience if its off to a bad start. I wonder how much time I have before that negative reputation sets in.

@Joel B. yep, this thread confirmed my suspicions. Appreciate the response!

@Michael Baum thank you for your response. After I closed on the property I ordered a ton of stuff to my PM's office for them to do the staging. Paintings, board games, etc. What seems like a ton of stuff in a wayfair shopping cart doesn't amount to too much in a 3 bedroom house. 

noted :) lets connect and keep in touch. 

@Dan Thomas I also found that to be weird. However I think they do a lot of business outside of airBNB, hosting mid/long term stays for travelling nurses. But still strange nonetheless for having so many properties and such few reviews. 

Thanks everyone for the replies. This is my third property purchase but first STR, and first long distance purchase. Appreciate the honest feedback, it has confirmed my thoughts exactly about the listing and why it isn't getting any traction.

I purchased a long distance short term rental from a 'turnkey' provider back in December 2021. I went through the purchase process 100% remote, and my property manager has been doing the set up and staging. 

After being listed for almost a month now, I have approximately 10 days booked for the month of April. Meanwhile many of my nearby comps are mostly booked for the spring and early summer months. 

Since I'm new to the STR game I don't really know what to expect. Is this an abnormally slow start or am I expecting too much? Here are 3 reasons why I feel like I'm not getting traction:

1. I have no reviews yet. 

2. My comps are either waterfront (I'm across the street from the river, not directly adjacent), or have lots of fun furnishings such as pool tables, fuseball, ping pong, bikes, canoes, etc. 

3. The listing has some weird provisions, such as: no toilet paper/paper towels/garbage bags are supplied. 3 night minimum stay (is this typical?). and there's a note that says 'this listing is geared towards mid/long term stays'.. this was all published by the property manager and some of this verbiage doesn't sit well with me (as someone who has stayed in many airBNB's in the last several years) 

Due to the reasons I list above, we dropped the booking price to be below the local average ($99/night). While I'm hoping more bookings come as Spring approaches, and I can accumulate some good reviews, hope is a terrible investment strategy and I need to improve this listing soon so I can take advantage of peak rental season.

Here is my airBNB Listing

Any feedback would be appreciated. I recognize I need professional photography, but I'm holding off until I can add more items to the property such as night stands, dressers, and misc. items as mentioned in #2 above. I will likely have to spend a week or two at the property, which I'm planning for in April.

For background: My market is a small river town 30 minutes north of Green bay, known for its fishing/boating/hunting and local ATV trails. While Spring and Summer are peak booking times, I can also expect winter bookings for GB Packers games. 

Thanks!

Matt

I'm considering converting one of my properties from a LTR to a STR whenever the current tenants move out. After running the numbers, the house would be way more profitable as a STR, even despite the city's (Philadelphia) 180 day limit. However I lived in this house a few years ago as a house hack, and I know this block tends to get the occasional/sometimes frequent drama with a select few neighbors. There's also a vacant lot directly across from the house that is always overgrown, collects trash and sometimes undesirable visitors. Definitely an eye sore.

Has anyone experienced guest dissatisfaction and/or poor ratings as a result of bad neighbors near a STR property? The general area is nice- close to bars/restaurants, public transit, decent parking etc. And the house is newly remodeled, and will photograph well with some nice staging and furnishings. Its mostly a peaceful, friendly block. I just wonder how these things may impact ratings and business in general.

Thanks!