All Forum Posts by: Tyler Work

Hey @Wes Short@Myka Artis @Dave Homyak have great points.  I'm of the opinion that its a very viable option, although you will obviously need to make sure the landlord is fine with it.  

It can be a great strategy that brings in way more cash flow and less risk vs. owning it outright.  It doesn't work in every market, and isn't for everyone depending on their financial goals. 

If your goal is to start a vacation rental business with little startup cost, risk, and barrier to entry - arbitrage is great.  If your goal is to build passive long term wealth and cash flow producing assets you can retire on, probably not the way to go.  

@Galya Iliev I ran a bunch of Airbnb projections in Pensacola proper and lets just say the numbers didn't exactly blow my skirt up.  If you don't care about cash flow and just want to break even and have a cool place to stay, you'll have a lot more options. 

As @Jay Helms mentioned Gulf Breeze and Pensacola Beach are great options.  Not sure what he thinks about Milton or Baghdad but there are dirt cheap waterfront lots for sale.  

All the folks I've talked to who run successful STR investments own waterfront condos purchased in the $250k range on the panhandle.

@Amy Ranae I don't own anything down there so take this with a grain of salt, but I've been looking myself for the past year or so.  I love the area, have tons of family down there, and have heard you can create some nice cash flow with vacation rentals.  

What I've gathered is that Rosemary and pretty much the whole 30-A area is likely going to be well over priced for what you can make back renting it out.  I think most owners rent on Airbnb to make some of the money back they spend but few people are actually cash flow positive.  Similar to markets like Vail, Breckenridge, etc.  

The folks I do know doing well have all purchased gulf front condos in the <$300k range, which are very hard to find. Okaloosa Island and FWB have some good options. I think most MLS listed 2 bed 2 bath condos are listing for around $450k. I would try and find a foreclosure or cheap condo if cash flow is your goal. If you don't want to personally stay in a condo, there are some cool lots and homes on the bay side that I've seen listed. I found a super nice 1 BR house on the water (bay) with a cool airstream on it for under $400k. No idea how they would do on Airbnb but if I can make money on my overpriced 1 BRs in Denver you should be able to do fairly well. Anyway, there's my 2 cents!

Hello BP Community!  

I am considering buying a half duplex in Pensacola, FL where my uncle owns the other half.  The eventual plan is to buy the other half in a few years when I have the capital or scrape and develop on the lot.  

Property Details:

East Hill Neighborhood - Pensacola, FL

Whole duplex appraised at $194,000 

Whole duplex taxes = $2250

Half duplex purchase price = $90,000

Currently rented long term for $800/mo per side

Could use some work but might not be worth it based on rent market. 

Plan - buy & hold either long term or rent on Airbnb 

My question is for investors who have experience in the Pensacola area. I know the city is going through a "renaissance" with some development, baseball stadium, etc but what is the overall outlook on long term investment in the area? What is general thoughts on long term appreciation and are rents rising? I currently live in Denver and have very little experience with FL markets. Really any thoughts or comments on the market in general would be greatly appreciated. I manage several Airbnb properties in Denver so I am familiar with costs and what it takes to manage a STR property. Thanks!

Hey @Wes Short

1) We are flexible.  If a client has a listing that already has tons of reviews we are able to keep that listing and just change the payout and login credentials to ours.  Works pretty seamlessly.  For new clients with no existing listing we will create one from scratch.

2) We outsource.  And by outsource I mean our housekeepers are all 1099 contractors who follow our procedures and guidelines.  We try to focus on running and managing the actual listings and focus less on running a cleaning company.  

3) I think this depends on the market.  In Denver, Airbnb domintes, but we still list on VRBO, Booking.com, and can take direct bookings as well through our website.

@Christina R. Your understanding of the Airbnb host guarantee is correct.  They frequently throw hosts under the bus and have numerous coverage limitations.  I use Foremost for my business insurance and can second @Kevin Hoag 's recommendation.  

I also insure my primary residence (which I Airbnb) with American Modern Insurance.  My premiums didn't go up at all when I switched to a vacation rental policy. 

@Matthew Kwong I would.  Keep your options open but its going to be tough to find a good deal looking in 10 different markets simultaneously.  

@Oren Harel congrats on your hosting experience, 5-star reviews are not easy to come by these days.

I have to caution you on your expectation of earning "passive income" by starting a short term rental management company.  There is absolutely nothing passive about it.   I thought the same way you did when I started rental company a year ago and my life has completely changed because of it.  Just something to think about before you take the plunge! 

@Matthew Kwong @Tim Schroeder just bought there, he might be able to help you out.

Agree with @Jim Sestito, I think the "right place" is different for everyone. There are good and bad deals in every market. If I had any advice it would be to stick to vacation markets (vs. urban markets), I know a few people who are making good returns on the FL panhandle but they are all self managing. Destin, Gulf Shores, and Panama City can be good options if you can find a gulf front condo with low HOA fees.

@Joe Splitrock the owner probably got burned by a previous guest and felt compelled to try and protect themselves with a lengthy agreement.  Signing a rental agreement shouldn't have anything to do with the price you pay for the unit.  Hotels offer 24 hour cancellation because they have tons of rooms and don't rely on one of the units for all of their revenue.  

If you don't feel comfortable signing it, I wouldn't sign it.  However, I don't think its that uncommon, and in fact it actually shows you are staying with a savvy host who likely knows what they're doing.  I could see it as a good thing.