How scalable are STRs?

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How scalable are STRs?

Jakub R.
Investor · NJ · Member since 2024 · 36 posts · 22 votes

Hi, is anyone successful in scaling STR portfolio? If yes, how many properties do you have and are you still growing or is current market too unfavorable?

It seems that being much more hands-on they are much harder to scale, but Im curious what people who actually built the portfolio think.

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John UnderwoodPro Member
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
10mo
Quote from @Danielle Solovyeva:

Hi Jakub, I'm in a fantastic training with Avery and Luke Carl through the short term shop. Avery has several informative books out specific to STR's and Luke hosts trainings twice per week related to all things STR. (Avery's book is the first one I read and one that motivated me to get into real estate) I encourage you to check them out.

Avery's books are a good place to start.
I don't recommend anyone put all their eggs in the STR basket. You should also have some stable LTR's that are a lot less work. 
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  • Danielle Solovyeva
    Member since 2025 · 2 posts · 3 votes
    10mo

    Hi Jakub, I'm in a fantastic training with Avery and Luke Carl through the short term shop. Avery has several informative books out specific to STR's and Luke hosts trainings twice per week related to all things STR. (Avery's book is the first one I read and one that motivated me to get into real estate) I encourage you to check them out.

    2Reply
    • John UnderwoodPro Member
      Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
      10mo
      Quote from @Danielle Solovyeva:

      Hi Jakub, I'm in a fantastic training with Avery and Luke Carl through the short term shop. Avery has several informative books out specific to STR's and Luke hosts trainings twice per week related to all things STR. (Avery's book is the first one I read and one that motivated me to get into real estate) I encourage you to check them out.

      Avery's books are a good place to start.
      I don't recommend anyone put all their eggs in the STR basket. You should also have some stable LTR's that are a lot less work. 
      6Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Danielle Solovyeva thanks for the recommendation. I never heard about Avery and Luke Carl, Ill check. Dows it mean they helped you scale your portfolio? Do you mind sharing how many do you have and over what period of time were you able to grow to the current number? And what would you say is the number one bottleneck in this growth - cash, your time, access to people who can take proper care of your assets, something else?

      0Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @John Underwood what do you consider an good balance between ltrs and strs? Are you able to keep growing one or the other in the current market?

      0Reply
    • Jon Martin
      Member since 2022 · 1k+ posts · 1k+ votes
      10mo
      Quote from @Jakub R.:

      @Danielle Solovyeva thanks for the recommendation. I never heard about Avery and Luke Carl, Ill check. Dows it mean they helped you scale your portfolio? Do you mind sharing how many do you have and over what period of time were you able to grow to the current number? And what would you say is the number one bottleneck in this growth - cash, your time, access to people who can take proper care of your assets, something else?

      Even if you put the finances aside for arguments sake, the challenge with scaling STR is that every property has a mortgage to be paid, a set of utility bills, mechanical systems, grounds to be kept, a set of vendors etc etc. Even if they are in the same area, your team still has to go across town from property to property to clean them, often on the same peak days of the week. There is a fixed amount of work and required attention for every property that doesn't decrease as you add more units, so aside from maybe some vendor consolidation and bulk supply discounts there isn't much in the way of Economies of Scale.

      Recently on the AirDna podcast with a boutique hotel investor one of them jokingly said "Wouldn't it be easier if all these properties were under the same roof? Yes, it's called a hotel" 

      1Reply
  • Denise SuppleeBusiness Member
    Realtor · Willow Grove, PA · Member since 2017 · 972 posts · 640 votes
    10mo

    Hi @Jakub R.nuce to meet you here on BP! The investors I’ve seen succeed build reliable local teams (cleaners, maintenance, guest support), use automation tools for messaging and pricing, and focus on a single market before expanding. Through my co-investing club, we’ve found success diversifying into STRs without taking on all the daily management ourselves. It’s all about having a repeatable process before adding more properties.

    Spark Rental Co-Investing Club577 Reviews
    WebsiteView Page
    1Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Denise Supplee is the investor's involvement critical or are good PMs able to take this work off the investors plate? Could you share a bit more about your strs, like how many are you managing now and in what markets?

      0Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    10mo

    It is not the easiest business to scale but it is doable, what are your goals?

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    4Reply
  • Jakub R.
    OP
    Investor · NJ · Member since 2024 · 36 posts · 22 votes
    10mo

    Currently appreciation and tax advantages (against my w2 income). In future - cashflow. At the same time Id like to know how hands off can it be. Thoughts?

    0Reply
    • Brian Fisher
      Investor · PA · Member since 2025 · 3 posts · 2 votes
      10mo
      Quote from @Jakub R.:

      Currently appreciation and tax advantages (against my w2 income). In future - cashflow. At the same time Id like to know how hands off can it be. Thoughts?

      I'm in that area currently of investment for appreciation and tax advantages over cashflow at the moment. However, the tax advantages against w2 income and the concept of being hands off are unfortunately in opposition to each other. Meaning, in order to offset w2 income with STR paper losses, you must fulfill material participation criteria in your STR(s), the least of which would be 100 hours and no less than anyone else. So, to maximize tax advantages, you can't be too hands off.

      1Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo
      Quote from @Brian Fisher:
      Quote from @Jakub R.:

      Currently appreciation and tax advantages (against my w2 income). In future - cashflow. At the same time Id like to know how hands off can it be. Thoughts?

      I'm in that area currently of investment for appreciation and tax advantages over cashflow at the moment. However, the tax advantages against w2 income and the concept of being hands off are unfortunately in opposition to each other. Meaning, in order to offset w2 income with STR paper losses, you must fulfill material participation criteria in your STR(s), the least of which would be 100 hours and no less than anyone else. So, to maximize tax advantages, you can't be too hands off.


      Thanks for bringing these criteria up, fair point. This would require splitting work across different contractors to avoid one person exceeding my time invested.. Does it have to be 100h per each property in this case? So the scaling would have to be "vertically" as in - move to a bigger, 1031 to a more expensive property over time, rather than "horizontally" to more properties?

      0Reply
    • Brian Fisher
      Investor · PA · Member since 2025 · 3 posts · 2 votes
      10mo
      Quote from @Jakub R.:
      Quote from @Brian Fisher:
      Quote from @Jakub R.:

      Currently appreciation and tax advantages (against my w2 income). In future - cashflow. At the same time Id like to know how hands off can it be. Thoughts?

      I'm in that area currently of investment for appreciation and tax advantages over cashflow at the moment. However, the tax advantages against w2 income and the concept of being hands off are unfortunately in opposition to each other. Meaning, in order to offset w2 income with STR paper losses, you must fulfill material participation criteria in your STR(s), the least of which would be 100 hours and no less than anyone else. So, to maximize tax advantages, you can't be too hands off.


      Thanks for bringing these criteria up, fair point. This would require splitting work across different contractors to avoid one person exceeding my time invested.. Does it have to be 100h per each property in this case? So the scaling would have to be "vertically" as in - move to a bigger, 1031 to a more expensive property over time, rather than "horizontally" to more properties?

      It does not have to be 100 hours per property. The STRs can be grouped into one activity (done as an election on the tax return) where the 100 hours and more than anyone else applies to the grouped portfolio. So, the scaling does not need to be continually graduating to more expensive properties... it can be a portfolio. As for the time itself, the logging of STR material participation properly is the most important part. For example, guest correspondence or time fixing a ceiling fan at the property is material participation, but time spent searching for your next investment property is not because it's considered investment time, not STR time.

      Your point about splitting work is a good strategy for keeping others' time lower than your own. The biggest time competitor is probably cleaning because it's something that's needed consistently and takes chunks of time for each turnover. Add to that: if you find a good cleaner, that's gold because property familiarity breeds better cleaning and property prep results. So, it's a bit of a dance. Rotate cleaners every few months to keep another's hours down at the risk of hitting some who do a bad job or are unreliable.

      1Reply
  • Garrett BrownPro Member
    Rental Property Investor · Houston, TX · Member since 2024 · 505 posts · 551 votes
    10mo

    If you want to scale seriously, focus on 1 market to grow in first. Use economies of scale to run it like a true commercial real estate business. Use properties you purchase, combined with co-hosting, to scale smartly with less money in. 
    I own/manager 22 units and work full-time but I'm only in 2 markets that are near each other. 

    [email protected]
    BiggerPockets
    2Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Garrett Brown do you keep growing your portfolio right now? Or do you find the market too unfavorable? Which markets do you invest in?

      0Reply
  • Dan H.Pro Member
    Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
    10mo

    STRs were significantly easier to scale prior to 2022 because the cash flow was so much better than today.   The appreciation in many markets was also better.   

    For example, if you purchased in pigeon forge a dozen years ago, you would have experienced a decade of double digit annual appreciation prior to the last couple/few years being flattish.   The initial years you would have also had very good cash flow.   Let’s say in the first 3 years you had 40% appreciation, on the appreciation alone you could have purchased a 2nd cabin.   Maybe with the cash flow over those 3 years you could have had the down for a 3rd cabin.

    Today the market has been flattish for the last couple/few years and the cash flow more modest.   Last I looked inventory was up significantly (I have not looked recently) which indicates near term appreciation outlook is not good.

    My local market is similar, flattish recent appreciation and cash flow is down and inventory is up. My view is the difference in cash flow in the local market basically is poor compensation for the additional work of an STR versus LTR.

    my belief is most markets are like the two markets I mentioned. They used to have good scale opportunity, but not that great now. So identify the market that is less recognized. My last 3 offers have been on properties that the STR monthly income have better than 2% ratio. Purchase price $475k for ~$120k/year income. My underwriting does not depict this as good cash flow, but in this RE environment this is what passes for good cash flow today.

    It is my view that we are in a more challenging RE market and quickly scaling is challenging.

    Good luck

    3Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Dan H. Thanks for sharing the numbers. Which markets are you focusing on? Increased inventory should give much more room for negotiation though, or are sellers just sitting on those proeprties without really being motivated to sell? Also, did you manage to get any of those three proeprties under contract?

      0Reply
    • Dan H.Pro Member
      Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
      10mo
      Quote from @Jakub R.:

      @Dan H. Thanks for sharing the numbers. Which markets are you focusing on? Increased inventory should give much more room for negotiation though, or are sellers just sitting on those proeprties without really being motivated to sell? Also, did you manage to get any of those three proeprties under contract?

      The sellers are not very motivated and are fine holding the cabins.   That is an issue with luxury cabins, the owners have little issue with holding costs and many have no financing so their hold costs are fairly low.

      One of the offers went under contract but fell apart.   Those 3 were luxury Sierra cabins.

      i have also placed offers on condos in emerald coast but have not got any accepted.   I have one of some interest right now, but my agent has not been as responsive as I would have liked.

      As indicated the underwriting is tight.    It makes no sense to pay what the seller may desire.

      Good luck

      0Reply
  • Basit SiddiqiBusiness Member
    Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
    10mo

    Most STR operators that look to scale look to get into small boutique hotels.

    It is possible to scale STR's but its more difficult. Below are some tips

    1) Look to concentrating in a specific area - Single family homes on one block or a multi-family house.

    2) Look to getting multiple cleaner and other important contractors
    3) Look to getting multiple apps to make to automate bookings / communications

    Best of luck

    [email protected]917-280-8544
    Basit Siddiqi CPA4.979 Reviews
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    2Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Basit Siddiqi thanks, by boutique hotels do you mean acquiring an actual boutique hotel or something more like running a fourplex? It seems a bit like a much more involved endeavor (branding, marketing, staff, etc), is this something youve been doing recently with good results? Id love to learn more how you approach it.

      0Reply
  • Quinton Brown
    Lender · Seattle WA · Member since 2025 · 211 posts · 33 votes
    10mo

    STR rentals seem it can be very time consuming, and more risk adverse, as I always think about
    seasonality, local regulations, and higher operational demands, especially without the proper team and support. However many of my clients manage STR.

    1Reply
    • Jakub R.
      OP
      Investor · NJ · Member since 2024 · 36 posts · 22 votes
      10mo

      @Quinton Brown I would definitely rely on property management team. Youve mentioned markets with steady demand - which ones do you invest in?

      0Reply
  • Rosston Smith
    Investor · Warner Robins, GA · Member since 2015 · 1k+ posts · 490 votes
    10mo
    Quote from @Jakub R.:

    Hi, is anyone successful in scaling STR portfolio? If yes, how many properties do you have and are you still growing or is current market too unfavorable?

    It seems that being much more hands-on they are much harder to scale, but Im curious what people who actually built the portfolio think.



    Current have 25+ and we're still scaling. 
    1Reply
  • Andrew Street
    Member since 2019 · 1k+ posts · 292 votes
    10mo

    I’ve seen quite a few operators still scaling, but it’s definitely not as plug-and-play as it used to be. The ones growing right now tend to focus on strong systems, solid housekeeping teams, and markets with steady demand - not just high seasonality. It’s still possible to scale, it just takes more intentional operations and less “set it and forget it.”

    Happy to connect and chat more about it!

    3Reply
  • Nathan M kiefer
    Rental Property Investor · south carolina and michigan · Member since 2023 · 348 posts · 226 votes
    10mo

    We have two, each worth around 750k. Scalable is relevant to cash in hand and financial leverage.

    In our experience you have to manage your own to make the money make sense. I'm sure others that are leveraged to hill or have more money/ more problems than me will say only hire a management company but we do it along with our 20 ltrs on our own and it works well. We are low debt so due to the number of houses we have we either have to go all in on debt and scale bigger or keep knocking down the debt we have which is minimal and get ready to enjoy big cash flow.

    There are a lot of variables base on where you want to go

    1Reply
  • Kenneth GarrettPro Member
    Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
    10mo

    @Jakub R.

    I have a couple STR's as well MTR's and LTR's. The time spent on my STR's is not that much. Under a few hours a month. Compared to LTR it is more, but not much. I self manage all my properties whether I am local or not. My STR's have appreciated way better than the cash flow. Cash flow is ok, but appreciations has nearly doubled. As with everything it depends on the market.

    Markets are currently in flux. Many owners have great mortgage rates and selling them at a discount is not advantageous. I think as this correction continues you will see more real estate coming up for sale.

    Patience is probably the key in today’s market, unless you are fortunate to have a bucket of cash available to spend.

    0Reply
  • Account Closed
    Interior Decorator · Member since 2025 · 82 posts · 42 votes
    10mo

    I'd say scaleable given you curate your designs for each property, and brand it. My two cents as an STR Designer. I've worked with some owners who are scaling and curating and increasing their ROI nearly 70%.

    0Reply
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