Short term rental deal breakdown
Hey guys, I have a deal I’m analyzing, would love some input...
purchase price: $170k
Rehab: 60k ( It’s in really rough shape)
ARV: 300k
Plan would be to cash out refinance, so put a 240k note on the property and pull back out my 60k in rehab costs , this would leave me with a $1600 mortgage
Gross estimated income: $3000-$4290
Monthly Expenses: $850
Mortgage: $1600
Net income: $550 -$1840
Realistically my total out of pocket to buy and furnish will end up being 30k
Is this property worth the effort ???
Most Popular Reply
Your monthly expenses figure looks low for an STR. With insurance, taxes, utilities, maintenance, management fee and then cleaning and supplies it adds up quickly. That doesn't even consider Cap Ex reserves.
We have a very similar property, and our expenses are close to double your figure.
You would still cash flow, but at a lower rate than your above numbers.