My First Real Estate Investment - A Short-Term Vacation Rental

Spending my teenage years in the Pocono Mountains of Pennsylvania, I fell in love with Winter Sports. First skiing and then snowboarding. In the early 90s, I moved to Pittsburgh and spent some time working as a snowboard instructor at a local ski resort.
Fast forward to now and you'll find me living in the Denver suburbs, with a profitable vacation rental near Winter Park resort.

How did I get here?

I grew up in Philadelphia in the 70s and 80s. My parents purchased a piece of land in the Pocono Mountains before I was born. At first there was a tent, then a trailer. We would spend most weekends there in the summer, and a few throughout the winter.
In my teenage years we moved there to get out of the city. That was tough for me, as I loved the city and I had a lot of friends that I didn't want to leave behind. But I adjusted, made new friends, and one could say I made my first deal not long after that move.

I was in high school, and to make some extra money I would babysit for some younger kids down the street. They lived in a 3 bedroom house with a detached 2 car garage, sitting on about 3 acres of land. The best part is that it was bordered on 3 sides, by the road, a creek, and a river. Granted, the Little Lehigh river was only 20-30 feet across, but that made for a great swimming hole and fishing right in the backyard.
One day the family that I worked for told me that they wouldn't be needing my services after the end of the month, they had found a new home and were planning to sell and move on.
I said "Great. Don't put up a sign. I'll get my parents to buy this house."
A week later, it was under contract.

As mentioned previously, after high school I made my way west to the Pittsburgh area. Then I decided that just wasn't far enough west, and I needed to find some bigger mountains. I partially credit my parents for giving me a love of the mountains and the realization that you don't have to be rich to own a vacation home. However, they never talked about money, so I never really knew much other than 'go get a job and start collecting a paycheck'.

In my late 20s, after a few years in Denver, I read The Wealthy Barber and began investing in mutual funds. Almost immediately the dot com bubble burst, but I was in this for the long haul so that didn't bother me, I was picking up my stocks at a discount.
Later I added an IRA and 401k, but still no Real Estate investments. I thought that was still out of my reach, or that I didn't know enough about it. That's when I picked up Rich Dad, Poor Dad and educated myself a little more.

This is where my Real Estate Investing career took off, right?
Not exactly.
I bought a townhome.
Then I got married.
We upgraded to a larger house.
Then we divorced.
Then there was a housing bubble and crash. I probably could have positioned myself well in real estate at that time, especially if I had known about BiggerPockets. But by then I had forgotten most of what I had previously learned and I was stuck in the rat race.
Note that even though I was stuck in the rat race, I was still making what I considered to be some smart moves.
As a young single guy, I bought my townhome instead of renting. When my wife and I upgraded to a larger house, I bought one in foreclosure to gain some instant equity.
After my divorce, I kept the house and hacked it by renting out bedrooms to a friend and a co-worker.

My stock market investments were still growing steadily and for a while this kept me happy. I thought that eventually this would be enough to guarantee a safe retirement. 
However, at the beginning of 2012 I started to worry about those investments.
For some reason I felt like a bear market was looming, and that we were all going to take a hit again. Even if I was wrong (so far I have been), it can't hurt to diversify, right?
I decided to liquidate the non-retirement funds (leaving the IRA and 401k parked) and invest it in real estate. It was time to buy my vacation home in the mountains. 

I spent most of 2012 looking for a Rocky Mountain property, in or near a ski resort town. On weekends I would head over the pass and meet with a real estate agent to tour various places. She was very laid back, no pressure to buy, and always happy to show me what was on the market. It was definitely a buyer's market then, so I wasn't in any rush. I almost had analysis paralysis, in that I wanted to make sure I found the perfect spot.
On each trip there was one condo that I made sure to look at again. I must have visited it four times before I finally decided to make an offer on it in December. I really think it was mostly for the view from the back porch. But also because it was just so cozy and warm all year round (I had visited during every season).

This condo needed a lot of work, as it was 80s decor, crappy old furniture, a broken countertop and questionable appliances. After being purchased for about $140k it sat on the market for the next 4 years.
I didn't know about the 70% rule, the 2% rule, ARV, or any of those things so often discussed here on BP. What I did know is that no one else seemed interested and the asking price was down to $90k for a 2/2 on the resort shuttle bus route!
Additionally, an identical bank owned unit in another building had just come on the market for $75k!

So, one might think I made an offer between $75-90k. But no, I took it another direction, literally. I figured if the bank owned one was $15k below this one, I should be able to get another $15k below that, so I offered $60k.
They countered at $67.5k.
I let the agent know that at $60k I could do a cash deal, but for $67.5k I would have to look for a partner, a loan, or something else that might take a while and result in my changing my mind.
They recountered at $62.5k.
Sold!

I spent weekends in 2013 gutting the place, taking it down to the floorboards and building the perfect kitchen and bathroom, adding heated tile flooring, new carpet and paint, and updating it with rustic mountain furniture. Somewhere along the line I decided that I should rent it out to other people that loved the mountains as much as I did. So, I started a business doing just that, in the beginning of 2014, about a year after purchasing it.

I joined the HOA and we've been rehabbing the exterior of the buildings too (6 buildings/38 units). We've got new roofs, sump/drainage systems, corrugated steel wainscoting, and within a year or so we'll have new siding as well. After my purchase the bank owned unit sold for about the same price. It was just flipped for $113k in August of 2015. I wish I would have bought that one too, even if it doesn't have the great views that mine does.

There don't seem to be a lot of people doing what I do here on BP. A few, but not many. The vast majority of buy and hold investors seem to do the long term rentals. Many people that I've talked to say it seems like too much work to do the short term thing. Although I don't believe it should be any different from long term leasing. In fact, in some ways I believe it to be easier.

Just like with any investment, how hard you have to work is mostly related to the team you have in place. And just like any business, it's all about systems you build that can free you up from spending time doing repetitive tasks.
With about 4 hours of work each month, this single door brings in about $500 in cash flow. If I could do that about 9 more times I figure I can get out of the rat race.

Now I just have to decide if I want to do short-term vacation rentals again, or venture into the long-term game. And regardless of the answer to that question... where?