BP people what is the right mix of long term and short term rentals? If you own a multifamily unit in a descent area for Airbnb rentals how many would you turn into short terms and how many into long terms?
Im looking at smaller multi family units in the Denver metro area 3-6 units.
I personally would have all my properties doing whatever is currently most profitable. which is usually STR. It is easy to convert STR to LTR, but hard to do it the other way around.
It sounds too intuitive to be true, but what @Tanner Crawley said is probably right. Whatever makes the most money is what the best mix is. I know that some people like the idea of some sort of "anchor" or "stability" with a long-term tenant, but if you're making 2-3x the revenue with an Airbnb/short-term rental that of a long-term rental, you've got a buffer built in should you need to transition from STRs to another model.
The bigger question for you, though, is what the regulations are in your community. As we'll discuss at our Airbnb laws presentation tonight (shameless plug!), most cites in the Denver metro area either don't allow short-term rentals in a purely investment property or, if they don't outlaw it, are looking at regulations to regulate it heavily.
What city are you looking at?
Haha what a great plug! Had I seen this earlier I would've come.
Looking in Lakewood and Wheat Ridge. If numbers make sense I would be willing to make my primary one of the units.
You would think that the cities would realize Denver is a tourist city... There's a reason most airbnb's in town are booked 2-3 weeks out. Let us investors thrive a little!
Never miss an opportunity to plug!
We'll have a Colorado Springs Airbnb laws talk soon and another Denver Airbnb laws talk later this month or in early September. We post it in the BP events page. Hope to see you out there.
Was reading from one of our colleagues posts about VOM (Velocity of Money). I think he called it. It was a new one on me - but it's an apt description. Back to VOM in a minute...
LTR's for areas that are popular with solid tenants good job prospects, and low vacancy, upward pressure on rents and no rent controls. If they cash flow, keep them.
STR in destination locations, high growth areas, with a cool (not too large property) close to the action (walking distance if possible) where you yourself enjoy visiting / vacationing.
The combination of STR income every week (sometimes daily or every other day if you have several) and LTR monthly checks on the first of the month is nothing short of fantastic!
You get money into your account constantly! VOM!