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Short-Term & Vacation Rental Discussions

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Cody Wageman
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Looking to start investing in STRs

Cody Wageman
Posted Nov 27 2022, 09:02

My wife and I are looking to capitalize on the equity on our home and start getting into the STR world. We have recently gotten a HELOC and are looking to start making the steps to buy a rental property. Being completely honest we are new to this. We have been reading a lot of books and information on this and want to start out in the right foot. How would you all recommend finding the right resources to help set us out right? I.e. tax advisors, maybe lawyers, business consultants, etc? All the books say to find good people but don't give great suggestions to make sure we get someone who knows what they are doing and are right for the world we are trying to get into. I appreciate any help you can give. Thank you for your time.

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Matthew McKee
  • Real Estate Coach
  • Boise, ID
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Matthew McKee
  • Real Estate Coach
  • Boise, ID
Replied Nov 28 2022, 16:06
Quote from @Cody Wageman:

Hey @Matthew McKee, thank you for the reply. I would be more than willing to set up a conversation. I am not in the boise area so if there is a way to do a zoom type call I would be on board for that. I am trying to learn now and build the right team to move forward with this. I don’t know how your process works but I am willing to have a call and discuss. Thank you for your help

Sounds good, I’ll shoot you a DM

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Dave Skow
  • Lender
  • Seattle, WA
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Dave Skow
  • Lender
  • Seattle, WA
Replied Nov 28 2022, 16:29

@Cody Wageman- thanks - best   first  step  will be to  get  formally pre approved  with a  lender  for  whatever  hypothetical  scenario for the  rental purchase  you want to  work with ...this will insure you are  able to  get  financing for the  property plus  it will educate  yourselves  with the process and the  present  numbers   ( payment / rate / cash needed for closing  etc ...)  

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Fernando Figueroa
  • Investor
  • Miami, FL
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Fernando Figueroa
  • Investor
  • Miami, FL
Replied Nov 28 2022, 17:34

Be very careful with STRs...They're quickly dying out...

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Fernando Figueroa
  • Investor
  • Miami, FL
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Fernando Figueroa
  • Investor
  • Miami, FL
Replied Nov 28 2022, 17:36

The main rule of thumb is make sure the property is profitable if you were to put a regular tenant and DO NOT rely on STR as your income when you're running the numbers for the property. I have had dozens of properties in FL and all short term, and it was basically a 10 year nightmare. Me personally I would never, ever do it again but I understand some people like that type of work/customer service. Get a good lawyer, appropriate structure to buy the property (LLC) and so forth. And just don't take anything personal, like those calls at 2am telling you there's a mosquito in the living room... Good luck!

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Michael Baum
Pro Member
#1 Short-Term & Vacation Rental Discussions Contributor
  • Olympia, WA
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Michael Baum
Pro Member
#1 Short-Term & Vacation Rental Discussions Contributor
  • Olympia, WA
Replied Nov 28 2022, 19:53

So I will disagree with @Fernando Figueroa on some points. You don't need an LLC with a single property starting out. All that does is force you to use a commercial loan with higher interest, higher down and more points. I think a good CPA is a must. A lawyer is nice to have in your pocket but not necessary.

I also don't think they have dried up. It will all depend on your area, what you offer and how you manage. Our lake house is doing just fine for 2023 and booking some stays for 2024.

Not everyone is cut out for the customer service a vacation rental requires. I haven't received any 2am calls from any of our guests in the 5 years we have been running ours. Having the place setup well and doing all the maintenance 2x a year on all systems will keep things running smoothly.

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Cody Wageman
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Cody Wageman
Replied Nov 28 2022, 20:43

@Michael Baum thank you for all of the input and suggestions you have provided. I agree with everything you have said. I have worked 10 years in the Tetons in the hospitality industry so I understand what’s it takes and a lot about the people who visit these areas and what they expect. I’m not overly worried about the unhappy customers, I believe we have the right knowledge and ability to set ours up to avoid that (mostly, I’m also not completely naive and realize there will always be people who are unhappy or complain no matter how well you do). I am actually currently working on getting a CPA. That is actually really high on my list mainly because I recognize I don’t understand that world and there is a lot of potential tax benefits to having someone who does have that knowledge. Do you have a tax person you work with that has been good for this type id industry?  You can direct message me with that sort of information if you do or whatever works. Thanks for the guidance

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Don Spafford
  • Investor
  • Idaho Falls, ID
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Don Spafford
  • Investor
  • Idaho Falls, ID
Replied Nov 29 2022, 11:11

@Cody Wageman I am in Idaho Falls. My wife is a Realtor here and services the entire Eastern Idaho region. She has helped many out of state investors find and purchase property here, both for LTR and STR. I can offer property management services as well for LTR within my immediate area, but not for STR. They require more time than I have available at the moment at least until I find the right people to make that happen. But I can put you in contact with others who are successful with STR in the area to find out who they are using. If interested in buying something here, anywhere from Island Park, Driggs, Idaho Falls, Pocatello, we can help!

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Michael Weigum
  • Real Estate Agent
  • Surfside Beach, SC
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Michael Weigum
  • Real Estate Agent
  • Surfside Beach, SC
Replied Nov 30 2022, 18:32

Hey @Cody Wageman,

That's so exciting! That is how I started my real estate investing journey. I used a HELOC on my primary house to purchase my first Oceanfront STR condo. I'm happy to chat with you about the journey. Shoot me a message!