All Forum Posts by: Tom Kastorff

Hey John are you still using a pricing tool like Wheelhouse or Beyond Pricing on your PS rentals? Saw you mention it in an older thread. I'm looking into them. Wondering if they've gotten any better with dynamic pricing around all the big events in PS that pop rates up. Or do you mainly do manual tweaking? Thx

@Jeff Davis

This is a topic I have been diving into hard myself the last 3-4 weeks. I am also a Socal investor who likes vacation rentals I can drive to (and potentially use). I would reach out to John D (I need to do so myself) and his Realtor / PM friend and pick their brains heavily. PS has a lot of weird ordinances, STR restrictions, costs, etc. You need to get a serious handle on all that before you spend the time to investigate which type of property you want to invest in.

One thought off the bat: how did you arrive at wanting "generates cash flow of roughly $800/mo" and what is your goal, budget, and plan to do so? It's a pretty lofty goal for SFH STR with 25-30% management fees.

From my research, personally I believe that will be very difficult to attain, on net revenues accounting for PM fees, maint, capex, utilities, etc. Curious to hear your plan.

John will probably tell you (my assumption based on what I believe his business model to be) you need to go with a larger / higher end SFH that can house lots of people in a party pad type model, that go for $500+ a night. But that is higher cost and higher risk. Not a "get feet wet" type move.

I am currently in deep offer analysis on a MF prop that you can only LTR (yearly lease) or STR of 28 or more nights (basically monthly rentals, for snowbirds, summer crash pad, etc.). No nightly rentals (what most consider STR) due to city ordinances. Different business model you really have to account for and plan to execute on correctly. I think I can cash flow $700-1000/mo but really depends on the maint/capex costs. If I remodel enough at purchase I should be good for a while, but you never know.

Look forward to hearing your responses to my question above. I do love this market, it is a high demand area with many bustling scenes and great weather, and IMO fairly recession robust because it is more of a high end destination, meaning most visitors are not as affected by downturns. And the restrictions -do- create opportunity if you find them, because of limited inventory.

Interested. Hot topic for me right now. Possibly making an offer on a triplex this week. Would love to talk with others locally about their experiences in MF. 

Yeah dude, that part is well established in the thread. Big town with 100s of hotels. Looking for granular info so folks can book THE hotel or one close to it. 

@Alexandra Hughes Pailet thanks for the link, exactly what I was looking for, calls out the Sheraton as home base. Thx!

Following.. and agree with @Adrian N. would be great to understand some basics so folks can start planning / looking at travel arrangements before the masses, if we decide to go. Once the floodgates open the hotels will ^^^^^^^^ $$$ ^^^^^^^. @Alexandra Hughes Pailet at least able to share the conf location? Thx

@Brandon Elliott I'm interested. By chance is this the orange/pink 4+1 that was recently listed for around $1.6M and just went into contract? I was eyeballing that one with an agent and the next day it went offline. Can you share details with me? Thx 

Lot of helpful responses thus far. Lifelong resident here, and my family has decades in RE experience. I suggest if you want help, state your goals for budget, location, quality, etc. MF in SD is not cheap, if anywhere near the coast, you're talking over $1M. Maybe you can find some duplexes or triplex in El Cajon for less, but only you can decide if you want to live out there (not me). "it can be done" in SD but it is very tough. There are upwards of 20000 licensed agents and probably just as many investors like us scrounging around for deals in this city. I think you'll find most SD investors look OOS or at least out of town (ie I target vacation rental towns in CA). 

@Bobby Russo 

@Anna Dmitruk did you take any action in the last two months? What else have you found out?

I am making an offer on an STR condo prop right now. Been doing some research based on your (Anna) comments above about talking to the "special program compliance for the City of Palm Springs" and found their website for vacation rentals (quite extensive, I am impressed). I am astonished that they have an annual vacation rental permit cost of $944 per unit, on top of what I assume is additional per-rental TOT they earn. That is incredibly high from other towns I have vacation rental prop in. Tossing a grand of profit down the toilet to the City of PS is a tough pill every year.

@John D. do you own any properties in the downtown / colony area? (palm canyon drive main drag restaurant area). Would love to pick your brain on STR in PS if you're open to chatting offline.

Not a ton of new material to add, mostly to add +1 to @Nathan Gesner and @Account Closed responses: becoming a licensed agent is not cheap. It's actually surprising how much it costs monthly/annually when you think about how many thousands of agents there are (google says 180000 in CA alone, my town has a reported 20000!). I have been reading Brandon Turner's book on rental investing, there is a section on "should I get licensed as an investor" that I suggest you read. After reading it, I went and had lunch with my local agent who did our last buy/sell transaction, to talk to him about getting licensed and is it worth it. I am currently a high level sales person in another field, and he knows this, so even with the allure of me becoming an agent under his shingle, he said No - don't do it. At least not yet. The cost of the 135 hours of material and testing, the shingle fees, the MLS fees, and every brokerage (REMax, KW, Compass etc) have monthly fees you pay to the house to be under their umbrella, as Jason noted, to cover their agent software and whatnot. It's a couple grand a year. It's not something I would sign you and your spouse up for quickly without an aggressive plan to recoup the costs quickly. One at a time would be a better plan as already suggested. I would also recommend doing what I did and having lunch or beers with a local successful agent and asking all these questions, and they can give you a hyper-local view of their costs and requirements.

@Natalie Kolodij responded while I was typing mine out, she is spot on.