Vacation Rentals Club In SoCal

[Jonathan Viero]

Just starting out up in Lake Arrowhead, California I got a lead on a Condo in the Lake Arrowhead Village 5 min walk from the Lake and located in the middle of all the shopping and dinning. It has a pool and hot tube, 2 bedroom 2 bath. It will sleep 9 guests after my startup shopping. Its owner is asking $1800 there is an $400 dollar HOA and I assume they are including that in the rent right? Heres the numbers I got from my analysis. Please check it out and tell me if I go wrong please.

Cost:

-Startup

Furniture= $1000 (already furnished I will just add and Crib, and Bunk bed)

Appliances= $300

Security Deposit=$3600

 Bath Supplies=$200

Kitchen=$200

Cleaning Supplies=$300

Total = $5,500

Recurring Monthly:

Rent= $1800

Utilities=$200

Internet=$100

Cleaning Supplies=$100 (I will do all cleaning until I find some one that can)

Misc=$100

Recurring Per Stay:

Cleaning service= $70? (How much do you guys think for this once I find someone what will they charge. The place is 1,000 sqr ft and mostly carpet?)

Consumables =$15

Total Monthly Expenses= $2280

Income:

Day rented per month 20-25 (Its a very high volume market up here so some months I will have very little vacancy)

Per night range $125/$275

AirBNB hosting fee -3%

Tax withholding -14%

Returns:

Investment paid back in 2 month

Weekly yield about $400 on average

Monthly cashflow about $1583 on average 

Annual Best Case Scenario Return= $19,268 post tax 

Annual Worst Case Scenario Return= $6,345 post tax

Air BnBs rent calculator for my area came out to be $2304, Eliotandme.com estimate on $1100 and my data said $1583. Pretty good right. Please let me know if you find my mistakes or please leave any advice or comments it would be highly appreciated! -Jonathan

[Paul Sandhu]

I think your utilities will be more than $200/month for a 2BR/2BA 1000 s.f. condo.  $70 for cleaning sounds right.  

Also include your time for cleaning and doing laundry.  If people check out at 11:00 a.m. and people are checking in at 4:00, how are you going to do the turnaround if you have a regular job?  

My wife didn't graduate high school.  She had enough college credits that she didn't need to go her senior year.  She finished college with a 4.0.  Now all she does is clean and restock our 23 STRs with 82 beds.  I find the people to rent them out, refinery contractors.  Big scary looking guys with neck tats.