All Forum Posts by: Neil G.

I'm having trouble deciding how much of a deposit I should put down for my primary residence (or potentially buy it in cash). I'm mainly concerned with opportunity costs of locking up a significant chunk of cash.

Considering the below notes, how might you approach this decision?

A) I'm planning on living in the property for roughly 5 years and then renting it out after me and my wife grow out of the place.

B) The total price of the home is about 25% of my net worth and liquidity isn't much of an issue.

C) I'm a high earner, so I shouldn't be in trouble locking up the cash.

D. My LTR break-even point would be with a 50% down payment (with a 30 yr mortgage at 6.5%)

My personal thoughts are that a 50% down payment on a 30 year mortgage might make some sense. So I can invest the other 50% and I will likely cashflow the property after I convert it to a LTR (I'll hopefully be able to refinance with a lower interest rate).

Please let me know if I'm missing something here or if anyone has any input or disagrees with this brief analysis.

Thank you!

Hi @Obed Calixte, I've gotten one so far at $165/sq ft for higher end build. 

@Stephen Dispensa thanks for your input. I have a developer connection (same person who quoted above build price) who claims he's able to do everything a-to-z. Which leaves me a bit confused since I'd be the one taking on the risk (i.e. buying the land and taking out a construction loan). I suppose in that scenario I would be the developer and he would be the project manager/builder? It's a bit confusing to me.

Hey Mick, I do have a realtor, but if you want to earn as a wholesaler, we can chat. I'll DM you

It wouldn't be a condo. They would be wholly owned by one person with no HOA, etc. That's my intention, at least. And I have seen many 2-unit townhouses set up like that here.

Hey BP folks, I want to buy a piece of land in the Tampa Bay area and hire a developer to build a mid-high end duplex and then sell one unit and live in the other unit. Any tips on how to find a suitable piece of land? This would be my first new construction deal. 

Also, any tips on financing strategies for this type of deal? 

Management tried to get the police to come out and write a report, but the police said it's a civil matter and not a criminal matter. 

Also, I have no idea what the oven is worth or how much to file a claim for, so I suppose I need a stonemason to come out and give me a quote...

What a pain in the butt!

PM cleans, so they have to go by after each guest. They just never mentioned it to me. But I just found an old photo from my landscaper that shows in the background that the oven was destroyed prior to July 8th. I didn't notice it in the photo before.

I do have a security camera in the back, but it only stores footage for two weeks and this was done before that...

So at this point, I don't think we will come up with any evidence as to what happened. 

I suppose my best bet is to simply get a repair quote and submit to primary insurance as mentioned by John above?

I just showed up to my rental property after 3-4 months and found my outdoor pizza oven smashed. It was handmade by the previous owner and I have no idea of it's value besides the fact that it was a gorgeous quirk that drew in STR renters. It was made with individual mother of pearl tiles.

Management didn't know when it was destroyed or who did it, but they did tell me that they suspected my neighbor has been breaking into my yard and using the area.

I have rental home insurance plus supplemental STR insurance, but I have no idea how to handle this since my management doesn't have any idea about the incident.

My primary insurance told me that the Airbnb renter should be liable, but again, I have no idea which renter did it, or if it even was a renter.

How should I proceed with this?

Thanks everyone for your input! To answer some of the above questions:

1. Here's my listing. Open to suggestions! https://www.airbnb.com/rooms/5...

2. My original estimates came from AirDNA. I calculated a target of $200/night with a 70% occupancy rate, although my break even point is $175/night with a 55% occupancy rate. PM did not provide any expectations going in. 

3. Here are my real numbers in 2022: 51% occupancy rate (roughly 65% in Winter and 35% in Summer), $2907/mo gross rent ($175/night), $1131/mo mortgage, $523/mo PM fees (18% of gross rent), $441/mo insurance, $285/mo repairs, $200/mo electric/gas, $150/mo landscaping, $120/mo property taxes, $115/mo supplementary STR insurance, $80/mo water/garbage. So my recurring monthly costs are about $3,045. 

4. I'm not going to manage it myself. I have two other business that take precedence and I live in Mexico, so that's not on the table. I allocated a couple of hours per week to manage this RE business. 

5. I'm using a PM that lists on multiple booking sites, although they don't tell me which sites were used for my bookings.

Since digging into the numbers to supply the above figures, I think I should:

A. Re-run the AirDNA numbers. I haven't looked since Summer 2021. Maybe the market changed.

B. Possibly cancel the supplementary STR insurance. I don't know if it's necessary.

Further suggestions appreciated!

Hey all, what would you recommend doing with a STR property that's just barely breaking even after all expenses? It's a 3 BR old bungalow in Tampa that I'm renting out on Airbnb. My prop management is handling everything, and they're doing an OK job. I'm at around 50% occupancy (on average - higher in winter, lower in summer), but daily rates are way down since the economy has started suffering. The property is a 8/10 in terms of the listing and amenities. It's a nice property, but I don't have a crazy theme to stand out from the crowd of listings and I only have 5-6 reviews so far (4.75 stars).

I just had to make an additional capital investment of $2.5K since it's a 100 year old property and things are breaking here and there. Plus, the summer is pretty slow, so income is down. 

So while the property has appreciated about 15% since I purchased it last year, it's not doing anything to provide any income after servicing the debt and all expenses. This is a side gig for me, so I'd like to get some cashflow without a ton of effort. 

I suppose I could A) Try to revamp the property (although I don't want to invest a lot of capital), B) Sell it, C) Switch to LTR or mid term rental (Furnished Finders - traveling medical professionals).

All suggestions and insight are appreciated!