Buying vacation home / STR should I bother with an LLC?

Question

Buying a beach vacation property that will be used as an STR for about 48 weeks out of the year, should I place this property in an LLC?

I will have significant equity in the property with only about  30% of the purchase price holding a mortgage note via family.   My plan is to start with a property management company (PMI) and go from there.

Attorney is saying buy it via an LLC but I am concerned I may be over complicating things.  Any thoughts?

I tried searching this topic in the forums as I'm sure its been asked but can't figure out how to isolate "STR & LLC".

Thanks!

Bruce Woodruff · Answer

Attorneys always say put it in an LLC. I've done it both ways. If you have adequate insurance it doesn't matter, it just costs more....

Megan Templeton · Answer

I would recommend using an LLC for the purchase and long term holding of the STR. STRs do have liability with the rotation of guests so its important to ensure the liability is removed from you as the owner and contained in an LLC.

Bryan Vukelich · Answer

Hi Steve - congrats on your new investment. I recommend you follow your attorney's advice and hold it in an LLC. My recommendation is based on personal experience, and advice I have received from attorneys & accountants as well as other investors over the years.

And it is very easy to form an LLC so not making the process much more complicated.

Best of luck

And it is very easy to form an LLC so not making the process much more complicated.

Best of luck

Yancey Sanderson · Answer

We did not buy ours in an LLC, but got advice from our accountant to convert it. We were pretty far into a refinance with a great rate when I got the advice. Our lender said they would not finance it as an LLC.

We finished the refi because I couldn’t pass up the great rate. I’m not sure what we’re going to do now. I ultimately want this investment in an LLC, but I’m not exactly sure how.

Steve Puglisi · Answer

Thanks Bryan! Appreciate the color!@Bryan Vukelich: @Bryan Vukelich:

@Bryan Vukelichundefined

Buying vacation home / STR should I bother with an LLC?

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