As part of a Meetup that I host, we bring in speakers on topics of interest to investors. A couple of months ago, we hosted @Scott Sutherland and he did a deep dive on the ROI and management of short-term rentals in Austin.
In the talk, Scott talks, expenses, AirBnB vs. Homeaway/VRBO, insurance, managing keys, and much more.
Thanks @Lynn Currie for posting this video. Scott's talk was super informative, and was the tipping point for me in taking the plunge to rehab one of our long term rentals and turn it into a STR. It's going great thus far, and was well worth it!
@Gary Ennis I saw your listing on VRBO. I love the house! I've actually taken the plunge on renting out my own house for special events. I listed it a couple of weeks ago and already have it booked for one week of ACL. I expect the second week to book soon since we're in walking distance.
@Karen Margrave I buy/try to buy regular ol' houses for sale in Austin. I've looked at a couple with @Scott Sutherland and am still kicking myself for not going higher on an offer for one of them. This particular property was listed on the MLS.
I'm currently remodeling a duplex for one of my business partners that she bought to STR. It was an off-market deal that came through a friend.
There are 2 things to consider when looking in Austin - the economics of the deal and the permitting (meaning are there any available). As long as both of those work, no need to go to a special service to find them. Of course, other cities/states may be completely different.
@Lynn Currie I am curious as to marketing to people looking for VR properties, because I've been told by several people that do VR's that the house in San Clemente would probably rent for around $6000 per week. It's not far from the beach, close to some new high end outlets, has 3 ocean view decks, and the layout is perfect to accommodate around 14 or so. Plus lot is big enough if someone wants to add a pool. If I could swing the financing right now, I'd keep it and set it up, but... have other deals to do.
For those looking for or wanting to sell VR, I asked Scott Trench if he could add a category on Marketplace so that when advertising real estate we can check off Vacation Rental. Currently there's SFR, Multi, etc. but nothing for VR. Also, keep your eyes open for the new Vacation Rental Forum, coming soon.
It looks like you're getting some good experience in that niche, so wanted to pick your brain as to where you look for such properties, etc.
Check out the floorplans, etc. for VR suitability, what do you think?
@Lynn Currie thanks! And congrats on your rapid success!
I'd sure like to find an off-market duplex to STR. :)
Makes sense. It would be great to have that checkbox.
As with most of my real estate knowledge, I'm very local, and I think it's safe to say that things that work in Austin, don't necessarily work elsewhere.
I LOVE that house that you linked to. I don't know the San Clemente market, so I don't feel like I can even begin to weigh-in on it's viability. It reminds me, in size, to the houses that we rent here by the lake. We're always looking for large houses, with as many rooms and beds as possible because we go with multiple friends, which usually includes gaggles of children. I'd be terrified of that scenario if that was my house. It's so new and clean!
I think the key for STR (as with most things), is having multiple strategies. For all of the properties I look at with that in mind, while STR might (or might not) be the highest and best use, I want to be able to do other things with it if possible.
For example, the house that I looked at that I wish I'd gone a little higher on so as not to have lost it (maybe I should start referring to this house as The One That Got Away™):
- It would have made a respectable return as a STR.
- It would have also worked as a long-term, regular rental. My ROI would have been horrible, but I could have conceivably covered the nut.
- It was a 2 bedroom property and we could have added a 3rd bedroom, increasing both the STR and yearly-leased rental rates enough to make it worth it, adding to our ROI.
- Long-term, I wanted to hold it to re-build someday. The lot was located on a sometimes-wet creek, setting it up for a great urban-infill project in the future. At the price I would have paid for it, I could have done that immediately, but I'm looking for a little diversification in my strategy right now and it's so rare that anything pops up that allows me to have all of these options.
Thanks for your insight, those are the things I've been thinking about too. I doubt I'll be able to keep the San Clemente house as a STR, but definitely want to do it with some other future properties.
Because I have the house in San Clemente listed for sale, it shows up on realtor.com, zillow, etc., so I've actually had people contacting me wanting to rent it for a week and even a month at a time for honeymoon, family vacation, etc., and that's what got me thinking about it as a STR.
As for "the one that got away", I hate those kind of lessons.
Yes, please add the VR option to the market place and glad to see this segment has finally spawned in the BP community.
Hey all. I really appreciate this thread! I had a question. I was looking into buying a "condotel" in Las Vegas as a STR but I ran into the problem of financing. One broker gave me a quote of 3,5,7 ARM for 30 year amortization while putting down %25 and starting at a rate of 5.5. That was much more than I anticipated. Do you guys have any input on finding a loan for "condotels".