Oak Island STR -- Update One-year In
I wanted to provide an update on our vacation rental after a full year placing the listing into service. We purchased the property in October 2021 for $459,000 and completed a roughly $25,000 renovation. Furnishings totaled $18,000. The listing went live in January 2022. We were shooting for $54,000 gross revenue and ended up with $71,300 in total revenue for 2022. After accounting for cleaning expenses, we ended up with $61,732 net to us before PITI, cap ex, and other costs. We do not allow pets in our home, for now, so we did not capture any pet fees. Our expenses are roughly $3,200 a month, so we ended the year with a net profit of approximately $23,000. We do self-manage our unit and have been incredibly grateful for our capable cleaning team and handyman. We are fortunate to have an interest rate of 3.15%, which helps to keep our expenses low. Our property is also not located in a special flood hazard area so we do not have to pay for flood insurance.
July was our highest revenue month, with December and January experiencing the fewest bookings. We still have lots to learn, but wanted to share our experience with others. As for the market, there has been a substantial increase in the supply of listings - as has been stated by AirDNA and others. As of Q4 2022, there are a total of 1,868 available units - which is an increase of over 500 units since Q4 of 2019 (1,360 units). It is interesting to note that there were 1,945 units as of Q3 in 2022, so I assume some operators have either sold their properties or removed them temporarily for the winter months.
Our listing can be found below. We're not sure what 2023 revenue will look like, but we hope to achieve similar numbers or perhaps even see a slight decline given the economic uncertainty and listing growth. Happy investing to all!