STR investors in the McCall or Donnelly market

[Aaron Akins]

Hello All,

If there are any Idaho or other investors out there in the McCall or Donnelly market, I'd love to get your take on the potential that either of these towns has or any other information you might be able to share with me. I feel like the appreciation outlook will be pretty good if looking at long term, but I'm concerned about the price of entry and how these markets might rent over the next few years. 

Thanks so much, 

Aaron

[Mike Smith]

@Aaron Akins I owned a home on West Mountain Road about 2 miles south of McCall. I sold it in 2019 to purchase some development land. I don't think you are going to find any properties in McCall that will generate 20% CoC. I don't use CoC when analyzing properties, but instead look at cap rates, but they are quite similar numbers.

The issue with McCall is the homes are very expensive and there are two huge shoulder seasons with very low occupancy.  Our home was 95% rented the entire summer (only vacancies were 1-2 slots between stays occasionally).  It probably only rented 65% of the time in the winter (Ice Carnival time was always booked); however, the real issue was spring time when skiing wasn't good, but boating/mountain biking/golfing/hiking was still too snowy and muddy.  We were at less than 25% occupancy mid-March through mid-June, and the same thing happened each fall.  Those months of low occupancy just kill potential profit percentages.

We can discuss further via DM/phone, but my research isn't showing anything in McCall/Donnelly with a cap rate over 3.3%, which is pretty dismal.  I agree in property appreciation, but when it's pretty high already, I feel the runway is limited.