$1,114 cash flow last month
This May I saw and immediately purchased a small apartment in the heart of an old town in Europe. The apartment was nasty, but I saw what it can be with a little money and effort put in. The town is a super interesting historical place, recently discovered by the world and now FULL of tourists from all over the world year round.
I put $45K to purchase it cash, including closing costs, and put in another $3,5K to fix it and make it nice. It took me about five weeks to fix it (would be three if I had a crew ready, which I did not). Immediately I put it on Airbnb and started cash-flowing right away. In July my cash flow from this small gem was $638 (this I had no reviews and so I lowered the rate to get some traction). In August it brought me $1,114 after all expenses! In September I am already booked with $550 expected cash flow and still 15 days available to be booked. And the nicest thing is, I have no mortgage to pay, no taxes, no nothing. My biggest expenses are toilet paper and soap. Even the cleaning service is paid by the guests. All I have to do is to email the access code to my guests and answer their questions about local restaurants, if they ask. And this can be easily automated or delegated.
I want to put in another $3K to make it much better and that would be it for a while with the renovations. So my total cash in, after I put this additional $3k, will be $51,5K and expecting to flow about $1,000 per month.
Do you find it to be an interesting deal? I can find more deals like this one, acquire them, and get them cash-flowing for around $50-$60K or less each. Traditional lending is too expensive here, so private lending or partnerships may work. I have already three of these kinds here and see other opportunities passing me by because I have my cash tied up into the three deals I have already acquired. What would you do to utilize these types of deals? What would you offer to the investors? How would you structure? Partnerships? Wholesale? Should I buy these with hard money, get them cash-flowing and sell, offering my Airbnb expertise and being here? Other ideas? I am really curious.... Thanks, friends! :)