S. Padre Island for STR?

15 Replies

I have a few LTRs but am curious about STRs. Does anyone have experience or info on STRs on S Padre Island? I'm curious as to how ROI compares to LTRs. I used to live in Brownsville (and still own a LTR there) but no longer live in that area. Thanks.

@Eric James I don't, in that area, but start by looking up units on airbnb, vrbo etc and compare with what you know about the LTR market and even zillow for sales. airdna might help with rental data too but look up places you'd stay at or in places you'd avoid and look at their rates. Good starting point. Very seasonal place, isn't it? 

Also look at CraigsList.  Short term and vacation rentals.

I had a friend, @Steven C. Suarez , trying to buy a condo out there for those purposes exactly but he was getting the run around. I personally stay away from "vacation" type areas such as Padre because you are going to have a down season and I'm not sure Padre has the economy to fit a corporate renter in there during your down season but you can always do a test run on the market. 

In looking on airbnb it looks like a 2 bedroom condo would rent for around $125/night right now (the high season).  That doesn't seem high enough to make it worthwhile to me.  And yes, most of the summer is a down period.

@Eric James I would triangulate your STR performance with your eyeballing on the main platforms like you've done, get a few reports from airdna for (near) actuals on gross rents, ADR and occupancy.

For more occupancy data, you can call up some vacation rental companies and see what they say is "average" occupancy over the year and probably round down to be conservative. For contrast, Galveston is ~40-50% "average" occupancy.

Yeah, I was looking to buy in S. Padre, the numbers were tough. You'd be praying to break even each year, but soon as you add the stiff HOA fees and assessments, you're underwater quick, no pun intended. Pluse, banks don't like financing beach condos, so it's a big headache. I think subleasing might be the best way to get your feet wet.

It didn't look worthwhile to me. As I recall, condos were renting around $150/night during the peak season. Especially given that SPI has a lot of down time (summer) when I could probably expect quite a bit of vacancy it didn't seem like a better proposition than long term rentals I'm doing. I like the area, and will probably go down for a couple weeks this summer with my family (and stay in a camper trailer at Isla Blanca Park), but I don't think I'll be buying a STR there.

My vacation rentals in SPI are making great ROI and best of all I get to enjoy them when they are not rented. If anyone needs any tips on the area feel free to send me a private message.

Originally posted by @Esteban Flores :

My vacation rentals in SPI are making great ROI and best of all I get to enjoy them when they are not rented. If anyone needs any tips on the area feel free to send me a private message.

What are you renting (condo, beach house, etc), what rent do you get,  and how many days did you rent it over the last couple years? I'd love to buy there if I could make it work. Thanks. 

I own a duplex. (1200sf/2bed/2bath per unit). 

Vacation rentals on the Island are  very seasonal, so you need to adjust your pricing according to season (supply/demand). Summer rates go for about $200/night. Spring break I was able to do $500/night most of march. Off season rates (December) I went as low as $50/night. 

They stay rented well over 200 nights out of the year. In my experience you just kind of break even during the off season (oct-feb) and your profit comes during the high peak seasons (march-sept).

I hope this answers your questions.

I'm looking at purchasing a 2 bed 2 bath condo in the Surf side Condo community South Padre Island.  It's on Windward across the street from the beach.  We would be paying cash.  The condo is already in the renters pool. I have asked my realtor for the last three years of rental income/expense.  Does anyone know if  32K  is a realistic income potential per year?

Hi Erika,

I'm familiar with the Surfside condos on SPI, however they aren't on Windward. The great Google machine tells me that Surfside Condos on Windward are actually in Corpus Christi. Are you looking on the Island or in Corpus? 

Originally posted by @Erika Christensen :

I'm looking at purchasing a 2 bed 2 bath condo in the Surf side Condo community South Padre Island.  It's on Windward across the street from the beach.  We would be paying cash.  The condo is already in the renters pool. I have asked my realtor for the last three years of rental income/expense.  Does anyone know if  32K  is a realistic income potential per year?

 32k is very realistic for a 2/2. I own a 1/1 beach condo and did 24k last year which included giving my condo away for 3 months to a Hurricane Harvey victim from Sept - Nov. On track to do 28k this year. We just closed on a 2/2 and expect to do closer to 40k/year  with it. 

Originally posted by @Steven C. Suarez :

Yeah, I was looking to buy in S. Padre, the numbers were tough. You'd be praying to break even each year, but soon as you add the stiff HOA fees and assessments, you're underwater quick, no pun intended. Pluse, banks don't like financing beach condos, so it's a big headache. I think subleasing might be the best way to get your feet wet.

It's only tough to get financing if you go through the big banks. I've used a local credit union for two beach condo purchases and it was super simple. Plus, local credit unions aren't fannie mae/freddie mac related so you don't have to worry about any govt related issues. No PMI if you put down less than 20% either.

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