I have an opportunity to purchase a STR in Waikiki that's occupancy rate is 93-95% and is already a "super host" on AirB&B. They require 30% down so I'm coming up short $60,000. Any private investors willing to help me start out?
I have an opportunity to purchase a STR in Waikiki that's occupancy rate is 93-95% and is already a "super host" on AirB&B. They require 30% down so I'm coming up short $60,000. Any private investors willing to help me start out?
Working with a realtor in Waikiki, the condo hotels they require 30% down. The occupancy rate is 93-95%, the HOA is very reasonable, the current owners already have it as a "super host" listing which makes it even more desirable. I also need to apply for the STR certificate for Hawaii. If I can secure the funding I'm short which is $60,000 of the $103,000 needed then we will put in an offer this weekend. If accepted it goes into Escrow. They do things quite differently than the mainland so I've been told and learning. I must work with a bank on the island once I'm in escrow.
I have an opportunity to purchase a STR in Waikiki that's occupancy rate is 93-95% and is already a "super host" on AirB&B. They require 30% down so I'm coming up short $60,000. Any private investors willing to help me start out?
@Joani Pederson - what terms are you offering a potential investor? Any equity stake in the property? What is the exit strategy for the investor - a buyout at some point? And based on the down payment amount, I'm guessing this is a studio in Waikiki? What is the average nightly rate in peak and off season?
And what are you calculating for ROI?
Just fyi - In my experience 93-95% occupancy rate is high. Definitely doable in peak season, but I recommend being a little more conservative on annual occupancy rate when running your financial calculations. One of the largest vacation rental management companies on the island targets an 85% annual occupancy rate. In his opinion, if it gets above 90%+, nightly rates are too low.
I figured the investor will give me their terms, buyout would be my plan. Yes it's a studio. Unless you want to do leasehold to get a bedroom condo is way out of my range as a beginner in real estate. I actually have the numbers from 2 of the 3 I'm looking into and took them and did an average Average yearly rate for the two is $46754.5 After the 3 taxes in Hawaii, mortgage and PM, cleaning one income revenue is $1555, the other is $1678. Both statements I received showed 92% occupancy. Nightly rate is $99-$137 without all the taxes figured in which is low compared to others I've seen as well as to what my realtor in Waikiki believes they could go for. HOA is one of the better prices we've seen. Any advice would be very much appreciated since I'm so new to this. I looked at what areas would withstand a recession the best with appreciation very likely. Hawaii only allows certain areas, complexes to do STR, some they allow but require 30 day stay or more. That would be great for traveling medical personnel but the average vacationer doesn't have 30 days. Others don't allow STR at all but some are doing it anyway. I'm not willing to take that kind of risk, follow the laws for me. As I said any and all advice much appreciated