All Forum Posts by: Robert Johnson

Hey everyone, I live in Austin and am exploring the idea of doing a house hack + STR combo. I travel frequently but would use it as my home base when I'm in town.

I found this property about an hour north of Austin: https://www.zillow.com/homedetails/17710-Fawnridge-Cir-Leand...

It has views of the lake and AirDna rates Leander, TX where it's located with a 62 market score. I'd definitely dive deeper into the regulations though. Using zillow's rent zestimate I think it would roughly break-even if used as a LTR as a backup plan.

I'm curious what the more experienced investors here think. How would you be thinking about this property? What questions would you be asking?

Quote from @Nicholas L.:

@Robert Johnson

I would strongly encourage you to make sure you actually want to own and operate an STR... which puts you in the hospitality business.

I only own LTR but I follow a lot of STR operators, including people in my network, and it has gotten much tougher both to buy and to operate. You really have to stand out from the crowd.

I didn't look at your bio or any other posts but - can you house hack an STR? That's a lower risk way to get started.

Hi Nicholas, my draw to STR is primarily the higher potential for cash flow. I have the time to manage the properties as well. If I could generate a high cash flow from LTR or MTR I'm open to going that route. I've explored the idea of house hacking but I live in Austin, TX and the prices here are so high that it's been turning me off to that idea. Open to having my mind changed though.

I've read "Short Term Rental, Long Term Wealth" and the direction is to use STR-specific data companies such as AirDna, but to focus more on the aggregate area data instead of individual property data. The other thing I seem to be seeing a lot is the ENEMY method.

For the ENEMY method in particular, I can grab 5 properties with the same number of bedrooms and bathrooms for consistency. I can look at airbnb and see how many days are blocked off in the upcoming 60 days for a rough occupancy rate, but given that many people don't book that far out this doesn't feel super reliable. Average daily rate is really difficult also because it's a different price for different days. It all feels like a ton of information and it's all over the place. 

I understand that STR income potential is highly variable but does anyone have a good resource to systematically go through and get some sort of a range?

Quote from @Michael Baum:

Hey @Robert Johnson, so 3k net cash flow is doable but that will be based on your purchase price.

If you have a 500k budget, I think that 3k will be tough... But that doesn't mean it will cashflow if you spend more. Not saying it isn't doable, but it will be tougher in this market.

Regarding the Bootcamp, I did moderation of the forums for the STR bootcamp so I think it is a pretty good value. The Q&A sessions were fun.

Pretty much cruise this forum as well. There is a ton of info right here.

Hey Michael, thanks for the prompt reply. To clarify, I didn't mean 3k from a single property - although that would be perfect. $3k is my starting overall net cash flow goal, even if that takes multiple properties. I do plan to keep 6 months of reserves for each property though so the fewer the better to get there.

Hey everyone, new investor here. 

I have a clear goal of trying to hit $3k / mo in net cash flow and I have a moderate-to-high risk appetite. After some initial research this has led me to being attracted to STRs.

I've read "Rental Property Investing" and "Short Term Rental, Long Term Wealth" so far this year already. Ideally I'd like to find a property where I have a reasonable chance of not losing my shirt with contingency plans (i.e. retain the ability to use it as a LTR or MTR if STR doesn't work for whatever reason). I have the time and willingness to self-manage remotely. Because this is my first property I'd really love to find something as turnkey as possible and avoid rehabbing.

I'm wondering if I should buy the bnbinnercircle or BP STR BootCamp program first or just get to identifying markets and talking to agents that specialize in STRs to start underwriting properties to estimate cash flow? I have a spreadsheet set up already but the "Short term rental, long term wealth" book didn't go into that much detail in estimating gross annual income. Yes I'll use AirDna and any other tool I can find, but if anyone has a good resource for estimating this I'd super appreciate it. Lastly, I'm looking for some advice on how to narrow down what market I'm looking at. I downloaded the STR Insights 2024 report and am looking through that, but combined with using AirDna's data and asking myself "where would I want to vacation" I'm feeling a bit of analysis paralysis. If it's helpful, I love the outdoors. I surf, I climb, I love the mountains and hiking so any of that feels interesting. Thanks!

I recently found renttoretirement.com and the concept is really interesting. I'm curious if there are similar providers for short-term rentals? i.e. a provider that will help source properties, evaluate them for cash flow potential, etc.

Quote from @Henry Clark:

Don’t know the program.

Based on your other posts looks like your in Texas.  

1.  Texas is the greatest state for property tax sales.  Don’t go to auctions.  Buy from their off sale lists.   Make low offers.

2.  Don’t do house tax sales unless you can bulldoze.  Takes 3 years for. Ownership.  Land is 6 months.

3.  Learn issues buying tax properties.

4.  Features: Whether you buy through tax sales or outright.  Look for views, seclusion, walkout basement potential, water feature potential- people love ponds, add trees, add boulders, multiple access or roadside properties, no zoning in Texas counties, check city zoning, location location, utility access.

5.  Subdivision potential

6.  Valueadd locations.  Selfstorage, flex buildings, next door properties.  If you can have a preexisting purpose for the land that will add value or for resale.

7.  Look for properties with high tension power lines over it.  You can’t build under the right of way but you can make money under them.  Other people won’t pay for that.

8.  Look for low spots, high spots.   Then fix for free.  Where other people see a mud hole, you see a nice building pad.

Key thing is you personally have to be creative.  Most people can’t see value in bare property.

 Thanks so much for this Henry! I love the idea of being creative with bare land. A few questions:

1. What's a property tax sale and do you have any examples of an "off sale list"?

2. Do you have any resources to learn the issues of buying tax properties? Or is that going to be specific to my location?

3. Can you point me to any resources to dive deeper into Land Hacking in general?

Thanks again!

Just as the title says, I'm curious if anyone has purchased that program, how much did it cost (the lite program is $2500 but the main one isn't priced) and was it worth it? Or is there another free resource somewhere to find all of this information?

I'm super happy with BP as a great resource for more traditional real estate, but I'd like to do some exploration into land hacking as well.

I'm doing some house hacking calculations and I'm curious what are some resources to determine how much I could rent out a room for?

Quote from @Michael Dumler:

@Robert Johnson, there aren't too many markets that meet the 1% rule. Moreover, I'd be very mindful of using that "rule" in the first place. 

It's important to recognize the trade-offs in real estate. While it's not always the case, deals that meet the 1% rule and generate high cash flow are often in C/D-class markets. OOS investing is a valid option, but as experienced investors will advocate time and again, you need to have a reliable/resourceful team established (agent, lender, contractor, PM). 

If you're solely focused on maximizing cash flow, I would explore creative investment strategies such as medium-term rentals and rent-by-room. 

I hope this provides some guidance! 

 Hi Michael, thanks so much for this advice! Do you have any advice on good resources to learn about medium-term rentals and rent-by-room?