All Forum Posts by: Zachary Beach

@Bradley Shuhart I don’t love negative cashflow but for me how much I have to put into it and how much loan pay down you have are big factors. If I had 2K a month in pay down and only put 5K into buying and getting property ready and it had negative 800 a month cashflow with no deferred maintenance in a good area I’m probably taking that as long as I can afford it. If your putting a couple hundred thousand down and loan pay down if 300 a month that’s a no for me.

@Blaine Suque it is became of the algorithms. They determine who shows and where. The other later comments confirmed my point when he brought up that he looked at 15 pages and couldn't find you on Airbnb. The algorithms are the number one most important thing in having a STR do well on the platforms particularly Airbnb and particularly when it is lower occupancy times. For example there have been months that in one of my markets the average occupancy was 14% but my properties did over 90%

@Blaine Suque your not ranking so your not being shown.

@Brian Barch a ton. In my market if a property had those numbers I would be able to more than double revenue. My market could be more season than your market but it’s a huge difference and frankly anyone saying it’s not huge has 0 credibility to me. In my market some days will max get booked at 75 dollars not counting cleaning fee and other days will book for will over 1K for the same house. Saturday will normally book for 3X Monday’s Friday’s 2.5X Tuesday’s and so on seasonality is also huge some times of the year it’s 350 for Wednesday and 1,200 for Saturday other times of the year it’s 120 for a Thursday and 300 for a Friday.

@John Matthew Johnston a lot of factors will come into play. The largest being immigration. If you take it as literally ever last Brady boomer that will be another 50 + years. barring a large change in birth rates, immigration policy, etc then yeah there will come a time but even then most housing will hold some value and houses in nice areas will be very valuable. There are countries like japan with declining population and real estate is still a solid investment.

@Wesley McDavid I think your biggest problem hasn't even been mentioned. Cash-flowing on a two unit property with only one unit rented with a 95% LTV loan with what 7% interest maybe 8% with PMI. Also you haven't mentioned if this partner has STR management experience at a high level but my guess is no if they don't have any money of there own. It seems to me as a STR management expert with multiple top properties in one of the biggest STR markets in the world that your partner would need to be exceptionally good at running STR's to make this work. I'm not even sure it could work in most markets. It seems to me the most likely outcome is you have a property with negative cashflow in a market likely going down not up in value in the short run. That said if it's cashflow positive and you get your money paid back in 2 years then own 50% and it goes well long enough for the market to keep going and loan being paid down. The return/potential up side is very large.

What you need is numbers and a business plan(specifically how they will make it a top STR and the steps they will take.) from the partner and if they make sense and you have the money and don't need it you could choose to bet on them.

@Bruce Woodruff it looks solid overall. I love the flooring. I don’t love the comforters and you need more colors. But your two main issues are pricing and algorithm placement. The pricing is the easier of the two to fix and will have positive effect on algorithm placement as long as you also keep review average up.

I disagree with everyone saying longer minimum night stay particularly if you have a good price like it sounds like you do for cleanings and a good term over system. The longer your minimum night day is the less revenue a property will have and the less occupancy period. I’m sure I will get people that disagree but at least in my market it’s a fact and I’m sure in most markets it’s a fact. Only times it may not be true is if you don’t do same day turn overs or if the area caps the number of yearly stays in some way.

@Bailey Kramer ok…. but that’s not how it works. To answer the first question yes occupancy matters as does pricing as does maintaining the property.

If done correctly in the situation you mentioned it would look more like 50% of Nights at 500 average and another 50% at 250 average.

I look at occupancy as a 0% or 100% stat. Every night is a separate sale that is either 0% or 100% if it’s a night we want booked getting it booked at best price with highest quality guest is the goal every night that we want booked not booked is a miss. Nights you don’t want booked maybe repairs or deep cleans like a professional grade carpet cleaning or something of that nature is different as running 100% occupancy for more that a few months straight can be hard on a property and it needed time to breathe.

It is possible to have days so low it’s not worth the work or risk to the property but if run well and in the right market/property that can be nearly completely eliminated.

@Ehlen Baylon I can recommend RE attorneys in CA I use if you want they could look into or know the laws in the specific city and give you a specific answer. Message me directly if you would like that

@Rachel Hurst I’m sorry I made that so complicated haha. what I’m trying to say is go find a second from a private lender for 8-12% interest get more money out and pay less interest.