Rental Property Investor · NJ · Member since 2020 · 13 posts · 9 votes
Hi BP - I'm a 26 year old newbie investor looking to purchase my first STR property in the Poconos. More specifically looking at Lake Harmony Estates. Been doing a lot of research online and doing my own analysis, but wanted to hear from people who have experience in the area. My criteria is 3-4BR, 2BA less than $550K. Planning on doing a 10% vacation loan and splitting it 50/50 with my father.
In order to break even, we’ll need to have it booked about 50% of the time. Looking on AirDNA and other websites, and seeing the average occupancy for the area is about 60% for properties in my criteria. Is this a reasonable occupancy rate? Was also looking through old forums, and saw people mentioning you’d be lucky to get 20-25% occupancy, and wanted to see if this has changed?
Please let me know what your experience has been and if there are any other areas I should be looking at. Any advice is greatly appreciated!
You're trying to buy at an all time high like you said. Housing prices are up 30 to 50 percent in last year or two alone. I really can't recommend it for someone new. If your numbers are running that close to breaking even, I'd strongly suggest you try something else. That sounds like LTR property if it's that bad. You should be able to crush it in an STR, it's a lot of work so if you aren't making a big profit why would you work for that?
Are you aware that the Township is drafting an ordinance that may make STRs banned? You should do some research and see what the local regulatory climate is like in different townships. Lots of lake Naomi residents are pissed off at STRs and are fighting it.
Seems like you've got some work to do, I'd suggest slowing down and doing more investigation.
Rental Property Investor · Prospect Park, PA · Member since 2014 · 28 posts · 12 votes
4y
Hey @Mike Dolan, as a homeowner of a 5br/2.5bth in Lake Harmony estates, I would say your research is close to what we expierence. There doesn’t seem to be much margin between your break even and market averages as far as occupancy. Are you looking for a particular cash on cash return or certain Cashflow each month?
hold back some funds for rehab and furniture as well.
Rental Property Investor · NJ · Member since 2020 · 13 posts · 9 votes
4y
@Mike Kelly thanks for your reply! Yeah the margin definitely seems tight, but we’ve been looking for turnkey properties so definitely driving the property value up and causing a higher monthly payment for the mortgage. How long have you been invested in the area?
For COC we were looking for anything above 20% and cash flow each month around $1.5k-2k.
Rental Property Investor · Prospect Park, PA · Member since 2014 · 28 posts · 12 votes
4y
@Mike Dolan those numbers are definitely doable. We have vacationed in the area for 12+ yrs and just purchased our first STR there in November of 2020. We also have a condo in the area that will be live after the Holidays. Even if it is turnkey, there are quite a few things your going to want to do to make it a positive expierence for your guests or to make your property stand out.
Ever since my launch in the Pocono Pines area I have had high rental rates. The area has been great so far for me, and I only expect it to continue appreciating in value over time, especially since the regulations are investor-friendly.
Don't hesitate to reach out if you ever need help with anything!
Rental Property Investor · NJ · Member since 2020 · 13 posts · 9 votes
4y
@Mike Kelly yeah we’ve visited a few times and loved it there. I guess with the lower occupancy but higher daily rate it balances out. How have the daily rates changed with the property values in Lake Harmony? Saw house prices basically double in the last few years and not sure if that’s due to the rental demand.
Rental Property Investor · NJ · Member since 2020 · 13 posts · 9 votes
4y
@Jonathan Dempsey thanks for your reply, and thats great to hear! Been seeing mixed reviews on the area so it’s refreshing to know a good return is possible. When did you launch in Pocono Pines?
You're trying to buy at an all time high like you said. Housing prices are up 30 to 50 percent in last year or two alone. I really can't recommend it for someone new. If your numbers are running that close to breaking even, I'd strongly suggest you try something else. That sounds like LTR property if it's that bad. You should be able to crush it in an STR, it's a lot of work so if you aren't making a big profit why would you work for that?
Are you aware that the Township is drafting an ordinance that may make STRs banned? You should do some research and see what the local regulatory climate is like in different townships. Lots of lake Naomi residents are pissed off at STRs and are fighting it.
Seems like you've got some work to do, I'd suggest slowing down and doing more investigation.