STR Regret Stories...

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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
2y

I dont have regrets just did not care for STR business personally.

so we sold.

But we have Mid term fully furnished rentals and I really like that one.. start off as a few months and end up staying a year or more and at close to double the rate and A class tennants.. Very Very passive which is what we like. 

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  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    2y

    Not us! I am betting that those with the biggest regrets are those that bought at the wrong time expecting COVID level occupancy was normal and those that didn't take the time to learn what it takes to run a successful STR.

    4Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    2y

    I agree with Michael Baum.  Too many people jumped on the bandwagon with overpriced properties, high monthly payments to amortize and saturation in some markets.  Of course there's the surprise that this is a people-focused, quick response, hospitality business that needs a certain level of business acumen.  Even with management software, you still have to run a business and be as good as or better than your competitors.

    4Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    2y

    Not I, but I am sure people who bought in pop up markets during COVID are as those markets shrunk back after (i.e. Boise) as well as people buying to get rich quick at decade RE highs and interest rates!

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
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    3Reply
  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    2y

    Vacation rentals are among the best investments of my lifetime.

    [email protected]806-672-7102
    SMOKY MOUNTAIN FALLS INC.51 Review
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    2Reply
  • Bryan Keller
    Member since 2023 · 16 posts · 14 votes
    2y
    Quote from @Collin Hays:

    Vacation rentals are among the best investments of my lifetime.


     Ditto!

    1Reply
  • Alex F.
    Investor · Plymouth, MN · Member since 2020 · 157 posts · 102 votes
    2y

    Hi John - We do have one property that will not be profitable or just about break even in 2024 due to all the unforeseen maintenance items:  pool heater, roof, pool fence, handy man over a dozen times, remodeling took 3 months instead of 3 weeks, etc.  Yeah if we had a re-do button perhaps we would have skipped this last purchase or done more due-diligence prior to the purchase.

    But very happy with our other properties.....

    Hi @Account Closed - Where is your STR located ?

    0Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    2y

    If your passionate about something, why not do it! That is the biggest regret to mankind.

    [email protected]330-557-3021
    2Reply
  • Alex F.
    Investor · Plymouth, MN · Member since 2020 · 157 posts · 102 votes
    2y

    @Sarah Kensinger - Yes!!  Totaly agree.  Two other regrets we have:

    a.  Not starting with STRs sooner.  

    b.  Passing on a couple properties that have become gold.....the should have/could have....

    3Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    2y
    Quote from @Alex F.:

    @Sarah Kensinger - Yes!!  Totaly agree.  Two other regrets we have:

    a.  Not starting with STRs sooner.  

    b.  Passing on a couple properties that have become gold.....the should have/could have....

    Oh man...now that is hard to swallow!
    [email protected]330-557-3021
    0Reply
  • Matt Mertz
    Leander TX · Member since 2020 · 179 posts · 150 votes
    2y

    I'll add one though it's not too bad.

    We built a big cabin in the Smokies in 2021.  Great property, going strong today.

    Decided to build again (small 1 bedroom). Spent all of last year with the builder and architect going back and forth to get the sqft cost down and finally threw in the towel. Spent a lot of money on a useless custom floorplan and various surveying costs. We couldn't justify the low ROI.

    We're so thankful we built the big one first.  We couldn't afford it at today's construction prices.

    2Reply
  • Brian Barch
    Member since 2022 · 272 posts · 253 votes
    2y

    No regrets here. Bought in 2022 (not due to COVID STR frenzy, its also personal use and plan to never sell) at peak interest rates and we are profitable even with one weekend/mo of personal use. Wish I would have done it sooner.

    That said, I wouldn't advise someone to get into the game if the goal is short term cash flow unless they were super savvy.  If that's the case, most people would be better off putting your down payment into a CD paying 5.5% interest.

    But if you have a long term horizon, use leverage appropriately, get personal use out of it, and actually enjoy the business part of it, it's a great asset to buy.

    0Reply
  • Shebi Khan
    Specialist · NC · Member since 2022 · 25 posts · 6 votes
    2y

    Vacation rentals will go up soon as we know the World Cup is coming!!

    0Reply
  • Angelo Cortez
    Oakland, Alameda County · Member since 2022 · 40 posts · 29 votes
    2y

    Not me. My places are 90-98% booked in Sacramento. 

    1Reply
  • Scott ScovilleBusiness Member
    Real Estate Agent · Sacramento, CA · Member since 2019 · 497 posts · 272 votes
    2y

    Buy in a good location and have multiple strategies should STR not perform as anticipated. I never limit my investments to one strategy. Give yourselves options, buy for the long term, and acquire good deals. Keep it simple, and don't chase the shiny object.

    [email protected]415-933-2202
    Scoville Realty & Investments LLC
    WebsiteView Page
    3Reply
  • Manny VasquezBusiness Member
    Real Estate Agent · Orange County · Member since 2022 · 317 posts · 293 votes
    2y

    Nothing but great experiences with STR's thus far....not perfect, but I am cash flowing. I got started with STR's back in 2018, my only regret is not starting sooner!

    1Reply
  • Troy Radtke
    Member since 2024 · 6 posts · 8 votes
    2y

    No regrets for me. I think a lot of the regrets come from people who didn't do their homework before buying a property. They just got caught up in the Airbnb craze and bought something, anything, just to get into the game. 

    And most of the people that have regrets probably aren't on BP...

    2Reply
  • Account Closed
    Investor · FL · Member since 2016 · 332 posts · 388 votes
    2y

    No regrets...owning and operating STRs is like managing a sports team. You want each property on your team operating at peak performance. Sometimes players need physical therapy (rehab), some need more 1-on-1 coaching (optimization/advertising) and some to be traded (1031 exchange). Your goal as the coach is to have star performers and it is your job to get them there. If everyone else's STR team around you does win and your team of STRs still fail to perform then the issue could be the manager/coach (you). Either get with the game and fix you, have someone else manage (if still profitable) or get out of the STR game. Alot of people who jumped on STRs in the last 3 years would be a Rockstar coaching other types or real estate investing teams but are not great at coaching STR teams. We see this when college coaches go to pros and fail. They are still great coaches just not in the NFL or NBA. You need to know when you need to move on to other investments. Me I am always managing my team and want to have championship rings every year so everyday I am looking for ways to improve my teams performance (ADR/Occupancy/optimization/rehab/improving my coaching skills)

    2Reply
  • Angelo Cortez
    Oakland, Alameda County · Member since 2022 · 40 posts · 29 votes
    2y

    I'll weigh in actually a bit. I have a duplex in Sacramento. Losing 1500-2k monthly on it. Yes we are bleeding. The appreciation is probably worth more than the cash flow loss, which I am okay with at this point, but it does hurt to see it bleed. Thinking of selling in 2-3 years if I can't refi at a lower rate. 

    0Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    2y

    Ouch!  Have you explored any other solutions than bleeding for 2-3 years?

    1Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    2y

    I dont have regrets just did not care for STR business personally.

    so we sold.

    But we have Mid term fully furnished rentals and I really like that one.. start off as a few months and end up staying a year or more and at close to double the rate and A class tennants.. Very Very passive which is what we like. 

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
    5Reply
  • Angelo Cortez
    Oakland, Alameda County · Member since 2022 · 40 posts · 29 votes
    2y
    Quote from @Mike Grudzien:

    Ouch!  Have you explored any other solutions than bleeding for 2-3 years?


     I’m giving it a shot to feel a whole year at least. I know that there is seasonality in any market. Jan-March are the slowest for Sac. Hopefully I can at least go even after these months

    1Reply
  • Oj Brown
    Member since 2021 · 20 posts · 9 votes
    2y
    I started vacation renting my home in 2010 back when no one knew what VRBO was or vacation rentals and it has been the best decision for me on so many levels.  I now also manage other peoples str in Tucson, AZ.
    1Reply
  • Lisa T.
    Member since 2020 · 5 posts · 2 votes
    2y

    Great discussion. I would really like to have a vacation home in California or AZ that my family can use to get out of the city and be closer to nature. I would need to use it as a STR part of the time to help cover the costs and for tax purposes, but I'm not really looking forward to "operating a STR business" and don't need a lot of extra cash flow (I have W2 job that I truly enjoy). Ideally, I would love something turnkey (furnished and operating as a STR now that someone wants to off-load). What is best way to go about finding such a property? Does something like this even exist in this amped up STR market with so many pros/operators out there nowadays?

    1Reply
  • Angelo Cortez
    Oakland, Alameda County · Member since 2022 · 40 posts · 29 votes
    2y
    Quote from @Lisa T.:

    Great discussion. I would really like to have a vacation home in California or AZ that my family can use to get out of the city and be closer to nature. I would need to use it as a STR part of the time to help cover the costs and for tax purposes, but I'm not really looking forward to "operating a STR business" and don't need a lot of extra cash flow (I have W2 job that I truly enjoy). Ideally, I would love something turnkey (furnished and operating as a STR now that someone wants to off-load). What is best way to go about finding such a property? Does something like this even exist in this amped up STR market with so many pros/operators out there nowadays?


    Your best bet is purchasing from a STR realtor (E.g. Zeona McIntyre) who has an inventory of turnkey rentals. Alternatively, there is Revnest. After that, you would probably have to get 100 hours in for the year, and then have someone PM it. I highly suggest speaking to an tax planner (e.g. EA or CPA) to help plan though. Best of luck in your journey.

    3Reply
  • Oj Brown
    Member since 2021 · 20 posts · 9 votes
    2y
    I'm selling my furniture if you have a home you want furnished for a STR.  2bd 2 ba 1 yr old lightly used great condition from in a luxury vacation rental apartment.  I'm asking 8K/flex and maybe it can be U hauled over to your place from Tucson, AZ.  Emerald Green Velvet Tufted couches and bar stools, etc. 130+ items.  I can send pictures and a list at your request.  It basically has everything you need to run a short term rental.  I have another vacation rental I have been running for 14 years and love it use it myself as a getaway on the non booking dates.
    0Reply
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