Marlton, NJ · Member since 2015 · 1 post · 0 votes
I'm looking at buying a beach house in South Carolina. The rental season from what I can tell is only really 5 months. I want to purchase a 2nd home and rent it out for as much as I can but take advantage of it in the off season. The rental income will cover around 10 months of PIT&I and additional expenses ie utilities, internet, phone, cable, water electric or about 80% of my out of pocket costs. I know the 50% rule is a rule of thumb for investment properties. Just wondering anyone's rule of thumb in this situation.
The 'rule of thumb' for this class of property is 'It's not an investment, it's a lifestyle.' I call these types 'hybrid-resort' and investing rules just don't apply well. Buy it because you want to, not for investment gains.
The 'rule of thumb' for this class of property is 'It's not an investment, it's a lifestyle.' I call these types 'hybrid-resort' and investing rules just don't apply well. Buy it because you want to, not for investment gains.
I m a big believer in these rules of thumb but they go out the window for a resort type rental. Income only comes in 5 months a year but expenses are 12 months a year. I am sure that throws the numbers way off the scale.