Short term rental sale valuation

[Travis C.]

I'm sure this has been discussed ad nauseum on here but are Airbnb / STRs valued differently during a property sale if they are performing cash flow-wise? Or you guys that have sold them just go with market valuations? I mean, is there a standard multiple you look at (times earnings) on these things?

[Zach Edelman]

Yes, as it's been stated on this thread, STRs are residential assets and thus, are going to be valued based off sales comps, as is standard procedure. Hopefully/potentially as STRs become more and more an official asset class, the prospect of a lender being able to value an STR off cap rate could be a thing, but for right now, it is not. If you're buying an STR that's being sold at a premium due to the fact that it already has existing operating history, be wary that you may need to bring more $$$ to the closing table than just the difference between the LTV you're approved for and the purchase price.