Best markets to do 100k in rev
Member since 2020 · 21 posts · 2 votes
Best markets to do 100k in rev
Most Popular Reply
An $800k property that grosses $100k is a 12.5% rent ratio. That's barely break-even after CAPEX, maintenance, a fair amount to pay yourself for property management, etc on some of these large properties.
My last purchase in Lake Havasu was $705k plus $160k remodel and furnishing, will do $160kish a year gross rents(I was hoping for $240k but market has slowed down bigtime). My last purchase between the Palm Springs / Joshua Tree area was for $800k and $120k remodel and furnishing, will do $220k a year gross rents (I was hoping for more like $300k but the market has changed bigtime, like many).
These larger properties have more overhead, I would encourage you to set your sights higher, especially in this market environment of diminishing prices and lower occupancy.
Sounds like you have properties that cost $630k purchase (plus some upgrades, furnishings, furniture, etc, expenses) that gross $8k a month. I congratulate you on getting started! But there are better numbers to be had. Have you taken a look at some smaller hotels or motels, or similar? Homes are expensive these days, the prices in hospitality have been beaten down after COVID, given their usual financing methods.
While I know short-term rentals are all the rage, there are small businesses to be bought with much greater returns, that don't necessarily require more time. Home prices have doubled in the last few years, and interest rates nearly doubled as well, which means your main underlying cost on a STR has basically quadrupled. While occupancy and rates are declining vs. the last couple of years. You either need to get REAL good at this business while preparing to make less money, or find a new angle. It's a new reality out here.
38 Replies
- 4yJohn UnderwoodPro MemberInvestor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
When you say revenue, you are saying gross income?
If so I think the more important number is what you keep or net income.
Try putting properties from different areas and price points in a spreadsheet and see were the best ROI is.
Heavy tourist towns like Branson or Pigeon Forge would be places to look.
- Member since 2020 · 21 posts · 2 votes4y
Quote from @Luke Carl:
You can do that in the smokies for sure. Love where your head is at!
Thanks @Luke Carl. I've looked at Chattanooga a bunch but they are starting to come down on STR. I'll start looking out there! Do you have any STR's in the Smokies? Any advice you wish you had when you started?
- Member since 2020 · 21 posts · 2 votes4y
Quote from @John Underwood:
When you say revenue, you are saying gross income?
If so I think the more important number is what you keep or net income.
Try putting properties from different areas and price points in a spreadsheet and see were the best ROI is.
Heavy tourist towns like Branson or Pigeon Forge would be places to look.
Correct. I’m referring to total earnings or income.
Love how both of the first two comments are telling me to head to the Smokies! Will check it out @Joshua Stein. If you have any tips specific to the area let me know!
- 4yRyan MoyerBusiness MemberProperty Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 996 posts · 1k+ votes
Hey I live right up the road from you, hello fellow Utahn!
Smokies could probably do that. I've got one in Orlando could do that pretty easily, especially if you're willing to put a little money into the property. There are some hidden expenses in Orlando compared to other markets though (high Fl taxes/ins, high HOA in the resort communities, high utility bills).
$800k-$850k will get you an 8BR in a resort community that projects out to around $100k. Add another ~$50k-75k of theming to the property and you could increase that revenue number to somewhere in the $150k-$180k range.
Cosmic Vacations4.9174 Reviews - Member since 2020 · 21 posts · 2 votes4y
Quote from @Ryan Moyer:
Hey I live right up the road from you, hello fellow Utahn!
Smokies could probably do that. I've got one in Orlando could do that pretty easily, especially if you're willing to put a little money into the property. There are some hidden expenses in Orlando compared to other markets though (high Fl taxes/ins, high HOA in the resort communities, high utility bills).
$800k-$850k will get you an 8BR in a resort community that projects out to around $100k. Add another ~$50k-75k of theming to the property and you could increase that revenue number to somewhere in the $150k-$180k range.
Hello! Just down in AF.
Those numbers blow my mind 😭. An 8 bedroom for 800k that has 50k in Disney theme could do 150k!? That’a crazy. Haha
- 4yRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?We've done deals recently that fit this criteria in these markets:
Galveston Texas Indio California Kerhonkson New York Lakeside Oregon Grayland Washington Saint Augustine Florida Lakewood New Jersey 
Harpoon Capital515 Reviews - 4yDale BertrandPro MemberMember since 2021 · 41 posts · 17 votes
Quote from @Robin Simon:
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?We've done deals recently that fit this criteria in these markets:
Galveston Texas Indio California Kerhonkson New York Lakeside Oregon Grayland Washington Saint Augustine Florida Lakewood New Jersey @Robin Simon I’m curious where you are investing in the northeast (NY and NJ). I’ve got two STRs in Massachusetts and it’s hard to make the numbers work around here.
- Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes4y
Branson is awesome. KC has good sub markets too to hit it
- Investor · Washington, DC · Member since 2018 · 93 posts · 54 votes4y
Quote from @Robin Simon:
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?We've done deals recently that fit this criteria in these markets:
Galveston Texas Indio California Kerhonkson New York Lakeside Oregon Grayland Washington Saint Augustine Florida Lakewood New Jersey Lakewood NJ? Huh?
I haven't been in that part of Jersey since 02, but am curious what exactly changed to bring that kind of earnings to Lakewood.
An $800k property that grosses $100k is a 12.5% rent ratio. That's barely break-even after CAPEX, maintenance, a fair amount to pay yourself for property management, etc on some of these large properties.
My last purchase in Lake Havasu was $705k plus $160k remodel and furnishing, will do $160kish a year gross rents(I was hoping for $240k but market has slowed down bigtime). My last purchase between the Palm Springs / Joshua Tree area was for $800k and $120k remodel and furnishing, will do $220k a year gross rents (I was hoping for more like $300k but the market has changed bigtime, like many).
These larger properties have more overhead, I would encourage you to set your sights higher, especially in this market environment of diminishing prices and lower occupancy.
Sounds like you have properties that cost $630k purchase (plus some upgrades, furnishings, furniture, etc, expenses) that gross $8k a month. I congratulate you on getting started! But there are better numbers to be had. Have you taken a look at some smaller hotels or motels, or similar? Homes are expensive these days, the prices in hospitality have been beaten down after COVID, given their usual financing methods.
While I know short-term rentals are all the rage, there are small businesses to be bought with much greater returns, that don't necessarily require more time. Home prices have doubled in the last few years, and interest rates nearly doubled as well, which means your main underlying cost on a STR has basically quadrupled. While occupancy and rates are declining vs. the last couple of years. You either need to get REAL good at this business while preparing to make less money, or find a new angle. It's a new reality out here.- Investor · Wilmington, NC · Member since 2017 · 44 posts · 16 votes4yWell said. Love the honesty.
Quote from @John D.:
An $800k property that grosses $100k is a 12.5% rent ratio. That's barely break-even after CAPEX, maintenance, a fair amount to pay yourself for property management, etc on some of these large properties.
My last purchase in Lake Havasu was $705k plus $160k remodel and furnishing, will do $160kish a year gross rents(I was hoping for $240k but market has slowed down bigtime). My last purchase between the Palm Springs / Joshua Tree area was for $800k and $120k remodel and furnishing, will do $220k a year gross rents (I was hoping for more like $300k but the market has changed bigtime, like many).
These larger properties have more overhead, I would encourage you to set your sights higher, especially in this market environment of diminishing prices and lower occupancy.
Sounds like you have properties that cost $630k purchase (plus some upgrades, furnishings, furniture, etc, expenses) that gross $8k a month. I congratulate you on getting started! But there are better numbers to be had. Have you taken a look at some smaller hotels or motels, or similar? Homes are expensive these days, the prices in hospitality have been beaten down after COVID, given their usual financing methods.
While I know short-term rentals are all the rage, there are small businesses to be bought with much greater returns, that don't necessarily require more time. Home prices have doubled in the last few years, and interest rates nearly doubled as well, which means your main underlying cost on a STR has basically quadrupled. While occupancy and rates are declining vs. the last couple of years. You either need to get REAL good at this business while preparing to make less money, or find a new angle. It's a new reality out here. - 4yRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Quote from @Dale Bertrand:
Quote from @Robin Simon:
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?We've done deals recently that fit this criteria in these markets:
Galveston Texas Indio California Kerhonkson New York Lakeside Oregon Grayland Washington Saint Augustine Florida Lakewood New Jersey @Robin Simon I’m curious where you are investing in the northeast (NY and NJ). I’ve got two STRs in Massachusetts and it’s hard to make the numbers work around here.
To clarify, I've been lending on investments in these areas. We've seen success in some of the smaller New Jersey markets that can hit the more wooded areas, the coasts and also be a reasonable distance to NYC/Philadelphia. The taxes are a huge hurdle there but still great opportunities for really experienced operators that know the area. I'd love to take a look at some of your Massachusetts options and see if we can help @River Sava
Harpoon Capital515 Reviews - 4yWale LawalBusiness MemberReal Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
I would highly recommend Houston, Texas, as rental income growth and appreciation here are steady.
Surrounding areas such as Katy, Cypress, Conroe, Tomball, and Pearland are great places to own rentals.
These cities tend to command quality tenants and they have great schools.Also to grow your real estate investment business you must have a great team of real estate professionals like agents, lenders, contractors etc.
Good luck!
NETWORTH BUILDERS5236 Reviews - Member since 2022 · 5 posts · 0 votes4y
Hello! @Cody Dastrup I'm in Utah too and have one property that I'm currently living in but am thinking of buying another and turning this into a STR. The market in SLC seems a bit saturated though for STR.
I'm curious, are you looking out of state because the numbers aren't working in Utah?
- Member since 2020 · 21 posts · 2 votes4y
Quote from @John D.:
An $800k property that grosses $100k is a 12.5% rent ratio. That's barely break-even after CAPEX, maintenance, a fair amount to pay yourself for property management, etc on some of these large properties.
My last purchase in Lake Havasu was $705k plus $160k remodel and furnishing, will do $160kish a year gross rents(I was hoping for $240k but market has slowed down bigtime). My last purchase between the Palm Springs / Joshua Tree area was for $800k and $120k remodel and furnishing, will do $220k a year gross rents (I was hoping for more like $300k but the market has changed bigtime, like many).
These larger properties have more overhead, I would encourage you to set your sights higher, especially in this market environment of diminishing prices and lower occupancy.
Sounds like you have properties that cost $630k purchase (plus some upgrades, furnishings, furniture, etc, expenses) that gross $8k a month. I congratulate you on getting started! But there are better numbers to be had. Have you taken a look at some smaller hotels or motels, or similar? Homes are expensive these days, the prices in hospitality have been beaten down after COVID, given their usual financing methods.
While I know short-term rentals are all the rage, there are small businesses to be bought with much greater returns, that don't necessarily require more time. Home prices have doubled in the last few years, and interest rates nearly doubled as well, which means your main underlying cost on a STR has basically quadrupled. While occupancy and rates are declining vs. the last couple of years. You either need to get REAL good at this business while preparing to make less money, or find a new angle. It's a new reality out here.@John D. thanks for the thoughtful response. I have about 10 different ideas just from reading this. Will need some time to digest all of the information/suggestions but I can see a ton of value here.
- Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes4y
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?You should check out the market here in Ohio, we have great cashflow and appreciation. I recommend the major cities in Ohio:
-Columbus, great for appreciation, pp is a bit higher around $220k for multifamily
-Cincinnati, has a mix of cash flow and appreciation, average multifamily around $180k
-Cleveland, has alot of cashflow potential, average multiform around $140k
There are other smaller markets like Dayton, Akron, and and Newark, which we are starting to see these areas boom due to huge investors and corporations like Intel choosing to set up shop in these kind of areas.
Looking for cashflow? Look into Cleveland, its got good cashflow potential with appreciation happening as well.
Looking for appreciation come to Columbus, there are still 1% deals, but the more attractive part is the population growth and other economic drivers!
- Member since 2020 · 21 posts · 2 votes4y
Quote from @Gretchen Quinlan:
Hello! @Cody Dastrup I'm in Utah too and have one property that I'm currently living in but am thinking of buying another and turning this into a STR. The market in SLC seems a bit saturated though for STR.
I'm curious, are you looking out of state because the numbers aren't working in Utah?
@Gretchen Quinlan I've heard of people (friends of mine) having success near Cottonwood Canyon. I think the theory is that they can charge so much during peak ski season that even in the summer months when it slows down, they are doing well. I've seen their P&L statements and can attest they are doing over 100k annually. However, I'm not sure they are operating in areas where STR are allowed/zoned (so I'd be careful).
I really wanted to make southern utah work. We have both of our STR’s near Zion National Park but it’s extremely competitive, there are a lot of licensing issues, and prices have recently skyrocketed. Our better property is 4 bed 2 bath and we purchased for 370k about 17 months ago. It will do about 65k. The other property we just bought a was already an Airbnb and will do about 40k this year.I am wanting to buy something more expensive that can get me more $ for my time. Instead of building a portfolio of 10 properties avg value of 400k, I’d like to buy 5 and $800k each and try to make similar margins. I have a great realtor and lender in southern utah, but the deals just aren’t there. I’ll definitely be investing out of state by the end of the year. In fact, I may even sell that high performing property in order to do so. I’m a year into this and so take my advise with a grain of salt, but I’m not seeing many great opportunities here either.
- Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes4y
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?Hi Cody,
I have nothing of value to contribute to your question since I'm fairly new to investing but CONGRATULATIONS on your STR Journey:-)
Tasha
- Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes4y
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?Hi Cody,
I have nothing of value to contribute to your question since I'm fairly new to investing but CONGRATULATIONS on your STR Journey:-)
Tasha
- Member since 2017 · 10 posts · 2 votes4y
@Cody Dastrup
Yes! There are many markets across the US that can pull those numbers. You should check out STR Insights because they can help you put in your budget and find markets that fit your revenue goals across the entire country.
But first, you need to determine what your preferences of region, market size, market saturation, regulation and other factors are. Just because a market can do the numbers you are looking for doesn't mean you want to invest there. I just bought a property on a lake for $350k. It should do over $110k this year and after I rehab it, it will do over $150k a year. Buuuuut, it's in New York. I'm fine with investing there but many others are not. Identify your personal preferences first then go check out STR Insights to find your next market. - Realtor · Provo, UT · Member since 2020 · 374 posts · 270 votes4y
A property that just came on the market in SL County did over 100k last year. I can shoot it to you if you’re interested
- 4yErin Dorsey RobinsonPro MemberReal Estate Agent · Cleveland, OH · Member since 2020 · 280 posts · 365 votes
Quote from @Tasha Barnes:
Quote from @Cody Dastrup:
Hey everyone!
I just secured my 2nd STR and in May entered year 2 of my STR journey. The 2 properties combined should do about 95k in rev next year on about 3.7k in monthly payments ($370k and $260k purchase prices respectively)
I’m wanting to challenge myself a bit on my next purchase and look at something that can do $100k in annual rev.
My question: Are there any markets where properties are sub $800k and doing $100k in annual revenue?Hi Cody,
I have nothing of value to contribute to your question since I'm fairly new to investing but CONGRATULATIONS on your STR Journey:-)
Tasha
Welcome to the world of investing Tanisha! Have any goals as you get started? Feel free to inbox me or email me directly if you ever care to discuss your plans or want to bounce some ideas around.
Good luck!
E
- Real Estate Broker · Staunton, VA · Member since 2019 · 194 posts · 216 votes4y
Just bought one for $800k projected to do $250k/year (conservatively)! Boutique motel in the heart of Virginia's brewery & winery country.
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