STR in the Smokys - Expenses

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STR in the Smokys - Expenses

Investor · Westchester Co., NY · Member since 2016 · 68 posts · 11 votes

Hi again, Trying to pick up some of my research in the STR market in the Smoky Mountain area. I am putting together a spreadsheet with some costs to help understand a the end game a little more - i.e. cash at the end of the year. Was hoping some of you all who have cabins can weigh in a little with some real life costs ....

Avg Nightly rent for a 2 Bed - estimating from VRBO / AirBnB ~ $140 over the course of the year. Does this sound like a good average or am I shooting Low/High?

Vacancy - I am guessing about 15%? for this area? Again whats been your experience. Is this high or low?

I am estimating the following for expenses. Some I have guessed, Some @Avery Carl (Thank you) has guided me on & Some I really don't know what they are in that area:

Garbarge - $50/Month

Water/Sewer - ?

Cable/web/Phone - $150/month

Cleaning - $500/ Month.

Electricity - $150/Month

HOA - Variable

Security - ?

Pest Control - ?

Gas - $50/Month

Insurance - $75/Month

Landscaping/External Maintenance - $75/Month

Capex - Going to use 5% of Gross receipts

Rental costs associated with VRBO/AirBNB and general Marketing costs - ?

Would welcome some feedback on these numbers any any that I am missing. I would be glad to share my spreadsheet once I have it put together

Thanks - Vincent

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Luke CarlPro Member

Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes

8y

@Nancy Bachety don’t turn guests away. Call or text me. You already have access to everyone you need :)

Also don’t worry about trash worry about the next purchase!!!! Massive action!!

Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills

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Account Closed
Investor · FL · Member since 2016 · 332 posts · 388 votes
8y
Earlier this week I had to do a rental projection on a upcoming builds for my bank. I used AirDNA and Everbooked data and here is what I learned.
1.Within $500 of being spot on for my rentals.
2. Over $75K off for my neighbor. AirDNA showed $10.5K for the year and he gets $5K a week in the summer (outdoor pool with phenomenal view).
3. If you didn't already know it, just one turn in a mountain road can take away a view and $20K-$50K a year and AirDNA has no way to account for this or bad management. You have to compare apples to apples when looking at AirDNA. Location in the Smokies is just not proximity to an attraction, but also view, amenities and standards of service.
4. Electricity put at $250 to $350 month, propane $50-$75 a month (if you leave the fireplace on for the summer...I do since everyone else's feedback gets dinged for turning it off).
The big question and maybe a new thread is needed for Sevierville, Pigeon Forge, Gatlinburg area is:
What is the best (maybe not the cheapest) option for internet when cable is not available? Any thoughts BP?
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Luke CarlPro Member
Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
8y
@Account Closed when there’s no internet there’s no internet. If you get dish internet it will A. Cost you a fortune. B. You’ll run out the first day of the month and your guests will not be happy. I have one with no internet. We make sure the guests know this. We stay packed with fantastic reviews.
If you can’t get a dish signal for cable tv all you need is a chainsaw. Or hire someone that’s has one.
Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
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Account Closed
Investor · FL · Member since 2016 · 332 posts · 388 votes
8y
@Luke Carl There are some ways to get unlimited cell hot spots depending on carrier can run $20 to $250. Currently using a AT&T $20 unlimited hotspot plan with a T-Mobile $20 2GB plan as a backup. Just curious if others have found great solutions.
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Luke CarlPro Member
Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
8y
@Account Closed trying to explain that to guests sounds like a nightmare
Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
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Account Closed
Investor · FL · Member since 2016 · 332 posts · 388 votes
8y
@Luke Carl To the guests it looks just like a home wi-fi internet as you leave the hotspot plugged in and on 24/7. We just put it in our welcome letter & I also have it posted on the fridge...so what they would see as example:
wifi name: Lucas_Mtn_Life
password: memories
(not my real password or wi-fi:)
I have a backup because like all electronics something could go wrong (user error usually) and does about once a year. When there is an issue we just shoot the guests the other wi-fi name and password.
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Tim Schroeder
Rental Property Investor · Castle Rock, CO · Member since 2017 · 335 posts · 387 votes
8y
My only options were satellite or hotspot. T-mobile hotspots offer a configurable amount of high-speed data (2Gb=$15, 6Gb=$30, 12Gb=$45, 14Gb=$60, 18Gb=$75) which guests will quickly use, then it drops to unlimited slow internet (128kb). So I just advertise "unlimited low-speed internet, fine for email and web browsing, won't work for video streaming" and I don't say anything about the high-speed. I got the 6Gb plan initially for $30 but plan to drop it to the $15 plan next month. There's no point in paying for ANY high-speed when it will be gone quickly anyway. The hotspot I bought was an ulocked NetGear Unite Explore. They are $150 new or reconditioned for $100. I'm happy with it so far.
@Account Closed If I'm not mistaken, your $20 AT&T hotspot plan will drop to low-speed once your high-speed data allocation runs out, so it's probably similar to what I have.
At the end of the day, you can offer guests low-speed non-streaming unlimited internet for $15/month which is pretty damn good. Just make sure you figure out which carrier has good signal in your area, and use that carrier. My unit works with T-Mobile, AT&T, or any of the smaller GSM carriers like StraightTalk, H20, Net10, and more. There are different hotspots that use CDMA technology for carriers like Verizon and Sprint.
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Account Closed
Investor · FL · Member since 2016 · 332 posts · 388 votes
8y
@Tim Schroeder I have a "mobley plan" in a Netgear Unite Explore on AT&T and it is truly unlimited (over 100GB monthly). The great thing with T-Mobile is most streaming doesn't count toward the data cap. There are RV'r forums which focus on truly unlimited 4GLTE. I wasn't sure if someone here has truly cracked the code past where I have gotten to so far.
Side Note: Looking at my data logs my worst abusers of data are families with children and photographers. Most weekly guests stay below 2-3GB.
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Tim Schroeder
Rental Property Investor · Castle Rock, CO · Member since 2017 · 335 posts · 387 votes
8y
@Account Closed It may be truly unlimited but they slow you down, right? I did a lot of research on this and could not find a way to get high-speed unlimited without a slow-down when you reach a certain point. If you really have this, I NEED IT! Can you tell me more? Like a link to the offer on AT&T website? Also, is there a "trick" to it? Like putting a SIM intended for one device into something else...?
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Account Closed
Investor · FL · Member since 2016 · 332 posts · 388 votes
8y
@Tim Schroeder The mobley isn't offered any more. It was meant to provide internet in a car. There is a way to get an AT&T ipad plan ($20) and put it in certain hotspots with no issues. If you are a tech'e you can probably can figure it out better than me. Join the facebook group "Unlimited Hotspot Plans" Read through the months of post and welcome to the 4GLTE unlimited community. Let me know what you figure out.
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Tim Schroeder
Rental Property Investor · Castle Rock, CO · Member since 2017 · 335 posts · 387 votes
8y
Thanks. I was just poring through the T-Mobile site and noticed that the plan I have "Mobile Internet for Hotspots" drops to 2G speeds (128kb) as I described before. But the T-MobileONE plan offers unlimited tethering at 3G (500kb or more). I initially discounted that because it's well known that it won't work in a dedicated hotspot. They can tell, and they block it. But, what if I put it in an old Android phone and left the hotspot feature turned on, then locked or hid the phone somewhere? Might be a good way to get unlimited 3G hotspot data, which is a whole lot better experience than 128kb which is only just tolerable.
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Nancy Bachety
Rental Property Investor · North Fork, NY · Member since 2016 · 1k+ posts · 631 votes
8y
@Tim Schroeder So you’d pay the monthly unlimited for an older phone and keep it plugged into a charger in a closet and give guests the code to tap into WiFi? That sounds like an option but what is the monthly fee for that phone? I think your plan with the unlocked netgear explore hotspot is a good option.
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Tim Schroeder
Rental Property Investor · Castle Rock, CO · Member since 2017 · 335 posts · 387 votes
8y
Yes. Anything under $50 would be a great option. The difference is that when you tether a device to a phone you get higher speeds - at least 3G. Whereas my current setup with the NetGear, you get a certain amount of high speed and when that's gone it drops to 2G. 2G is only just tolerable for email, etc. But 3G is pretty decent web browsing experience. I am still investigating options. I'm already reading the RV forums where discussions about ways to get unlimited 4G are abundant. This website looks really interesting and helpful
https://www.rvmobileinternet.com/news/
1 Reply
Christina P.
Kalamazoo, MI · Member since 2018 · 3 posts · 1 vote
8y
I found Quick Relay in Sevierville offers 50mps (I think) through Wi-max. Wi-max is kind of like a long-distance wifi where they don't have to run any cables to the house. Just a receiver on the roof. Its truly unlimited and is $100 a month. If you have a clear path to one of their transmitters (our transmitter is on Bluff Mountain) they might be able to service you. The price and speed on their website is outdated since they just upgraded their equipment a couple of months ago. You will have to call to get the latest info and site survey.
1 Reply
Will G.
Rental Property Investor · Maryville, TN · Member since 2009 · 529 posts · 414 votes
8y
still would like to know if there is percentage of gross i can use to figure expenses??
0 Reply
Rhonda Blue
Real Estate Broker · East TN Loudon/Lenoir City/Tellico Village · Member since 2014 · 363 posts · 222 votes
8y
@Will G. My husband and I were discussing this last night and for the STR we figure it like this. 1/3,1/3,1/3. We go into a property with 20% down. Our returns have been 1/3 - mortgage, 1/3 expenses, 1/3 profits. This formula has been proving out for our 4 STR with the only variation being monthly we have exceeded the 1/3 profit. Please finance gurus don't rip me apart.
2 Reply
Will G.
Rental Property Investor · Maryville, TN · Member since 2009 · 529 posts · 414 votes
8y
Rhonda, thanks for sharing your experience.
Does your 33% expenses have a reserve amount built in for eventual replacement of major components?
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