Do views matter for STRs?

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Do views matter for STRs?

Karl McGarvey
Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes

Hello!

Currently in the search and doing due diligence on STRs that are on or near the beach, and wanted to see from others experience how much the view from a rental matters in terms of rental returns. We are looking at a few different condos in the same complex some of which have views of the complex pool/beach, and some with views of a gas station with the ocean also. The difference in price is anywhere between 15-25K and as a new guy its tough to know if the extra money will translate into renters! (My initial thought is take the reduced risk and go cheaper on our first one knowing we can always buy more expensive next time, but I also don't want to pass up “great” deals if they exist. Plus, knowledge is power. Appreciate any input!

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Mark Miles
Rental Property Investor · Philadelphia, PA · Member since 2016 · 542 posts · 715 votes
6y
Originally posted by @Karl McGarvey:

@Lucas Carl thanks! So far no issues from lenders, but I will keep my eyes open on it when I speak to them again on Monday. Completely agree on this being an opinion question, but opinions from experience is much more than I have haha.

 Oh, one more thing: don’t just look at your competitors listings, but also read their guest reviews. I often read my competitors reviews to see what features guests are raving about and what features guests are complaining about. That will give you great insight into what guests actually care about in your area.

If you see a lot of guests raving in reviews about the spectacular ocean views, that shows you there’s value there. If instead, you see most guests are raving about things like how close you are to the beach more than they are about the views, then it’s possible that the views don’t really matter. Also I think it depends if you have a patio or not. I think views matter more when there’s a patio facing the water. Just my two cents

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  • Luke CarlPro Member
    Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
    6y

    Going to be nothing but opinions on this one. My opinion is.... if it’s a condo yes it has to have a view. But I do not like condos to begin with. Also make sure you google non-warrantable loans if you haven’t already. 

    I’ve got a couple of log cabins in the mountains that do not have views and they’re packed every night. 

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  • Mark Miles
    Rental Property Investor · Philadelphia, PA · Member since 2016 · 542 posts · 715 votes
    6y
    Originally posted by @Karl McGarvey:

    Hello!

    Currently in the search and doing due diligence on STRs that are on or near the beach, and wanted to see from others experience how much the view from a rental matters in terms of rental returns. We are looking at a few different condos in the same complex some of which have views of the complex pool/beach, and some with views of a gas station with the ocean also. The difference in price is anywhere between 15-25K and as a new guy its tough to know if the extra money will translate into renters! (My initial thought is take the reduced risk and go cheaper on our first one knowing we can always buy more expensive next time, but I also don't want to pass up “great” deals if they exist. Plus, knowledge is power. Appreciate any input!

     This one is totally location dependent. The only real advice that anyone can give you is to go on Airbnb and check how your competitors are doing, comparing those who have views with those who don’t. It’s even possible that someone without a view might be doing better than someone with a view if, for example, they offered better amenities or had nicer decor. Search for yourself and find out!

    3Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Lucas Carl thanks! So far no issues from lenders, but I will keep my eyes open on it when I speak to them again on Monday. Completely agree on this being an opinion question, but opinions from experience is much more than I have haha.

    0Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Mark Miles I have actually being scouring all of the local PM websites to look at availability and pricing to try to do just that

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  • Mark Miles
    Rental Property Investor · Philadelphia, PA · Member since 2016 · 542 posts · 715 votes
    6y
    Originally posted by @Karl McGarvey:

    @Lucas Carl thanks! So far no issues from lenders, but I will keep my eyes open on it when I speak to them again on Monday. Completely agree on this being an opinion question, but opinions from experience is much more than I have haha.

     Oh, one more thing: don’t just look at your competitors listings, but also read their guest reviews. I often read my competitors reviews to see what features guests are raving about and what features guests are complaining about. That will give you great insight into what guests actually care about in your area.

    If you see a lot of guests raving in reviews about the spectacular ocean views, that shows you there’s value there. If instead, you see most guests are raving about things like how close you are to the beach more than they are about the views, then it’s possible that the views don’t really matter. Also I think it depends if you have a patio or not. I think views matter more when there’s a patio facing the water. Just my two cents

    4Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Mark Miles great advice. I actually had a friend bring up the idea that some ppl will even take the less desirable view to not have to worry about noise from the pool. All about taste haha

    1Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    6y

    Hey @Karl McGarvey, like others have said, it is all dependent on location. We have a lake house so people come for the access and the view from the 2 decks.

    1Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Michael Baum thats a fantastic view. I will try to post pictures of the difference of views we have to get better opinions. But in the end I think alot of it really comes to what the renters want at the time or what is available.

    0Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    6y

    Thanks @Karl McGarvey! Frankly, it all comes down to that old adage, location, location, location. In this sense, you can't add a view to a place without one.

    I would spring for the place with the view. No one ever complains that there was too much of a view. Unless it is of a parking lot or dumpsters. :)

    1Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Michael Baum haha thats the trouble. Trying to make sense of how much extra we will make/lose because of it. All things considered 30k difference in loan is about a night a month of rent in a place airDna says we should expect 52% occupancy.

    0Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Karl McGarvey truth be told there is one with “the view” on the cheaper end that is in the rental pool of the complex so its very generic. My position right now is to make a deal for that one and force equity into it by doing upgrades

    1Reply
  • Nathan Speary
    Member since 2020 · 9 posts · 7 votes
    6y

    If the difference is a night a month where the expectation is 52% occupancy, I would personally spring for it. I own 8 homes near a national park and the ones with the best views book the most. If you’re in a condo keep in mind that the things that will set you apart are decor, views and price. You don’t want to be forced to compete on price; which you’ll have to do if you can’t compete on views. At the end of the day it’s sort of hard to decorate a condo and make it look wildly different than everyone else






    1Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    6y

    Absolutely!

    Location and views are critical. 

    You need one or the other but both is ideal.

    I have views of the lake and am close to a major University. This gives renters many reasons to book my house.

    I just had an inquiry from a highly ranked freshman offensive lineman's parents. They live out of state and want to book many of the home games for the next 4 years plus more dates to come visit their son.

    0Reply
  • Avery CarlBusiness Member
    Real Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
    6y

    Although things can vary from market to market, in my experience in the few markets I'm in: If it's a condo, in most cases, it needs to have a view. You are trying to set your listing apart from all the other identical condos in the building. View will help with that.

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  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    Thanks for all of your responses! 

    Here are the view differences. First two are the view from the balcony of an unfurnished unit, last picture is the better view with a furnished unit but... 25K difference in asking price. Each have a view of the ocean, just a different quality view

    0Reply
  • Paul Sandhu
    Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
    6y

    My STRs have a view of a refinery, way off in the distance.  It doesn't seem to bother my renters, as they are contractors working at the refinery.

    0Reply
  • Mark Futalan
    Rental Property Investor · La Quinta, CA · Member since 2018 · 263 posts · 95 votes
    6y

    I would say if your place is in a true vacation rental area, that views can help. I have properties with a golf course view and Mountain View. With the increased competition in our area, I’m finding that any way to differentiate yourself from the crowd is important. Pictures and how the home is marketed or “presented” also are important factors.

    0Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    6y

    If the first two are views from the same unit and same balcony, they are going to spend most of their time looking at the 2nd photo, not the first.  As the first unit is unfurnished, you may want to find out how much it will cost to furnish the unit.

    With the $25K difference, are we talking $75K vs $100K or $525K vs $550K?  You can always negotiate a lower price, how low will depend on how many days the unit has been on the market.  There are other factors as well like condo fees, taxes, etc. which will affect your bottom line.

    0Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Theresa Harris

    132K for furnished, 108K for unfurnished. Both asking and yes I am always for negotiations!

    The first two pictures are from the same balcony just different angles.

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  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Theresa Harris the difference in mortgage costs essentially means needing an extra night of rental a month to break even on the extra cost.

    0Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    6y
    Originally posted by @Karl McGarvey:

    @Theresa Harris

    132K for furnished, 108K for unfurnished. Both asking and yes I am always for negotiations!

    The first two pictures are from the same balcony just different angles.

    If the interiors are identical aside from the furniture (layout, beds, baths), I can't see the furniture being worth $25K.  You can easily get second hand furniture to furnish the place. I'm assuming appliances come with both units.  The second photo has the best view.

    0Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Theresa Harris the interior floor plans are identical minus flooring and counters. This is where I think if we went cheaper we could force some appreciation by doing the upgrades ourself. All costs for each unit are identical as well (taxes/Hoa/insurance) so the playing field is very even minus a few factors

    0Reply
  • Glenna Wood
    So MD · Member since 2019 · 294 posts · 191 votes
    6y

    Pic #2 is it. Go with the best view. That and distance to the beach are the two things you can't improve by throwing money at it.

    It's basic supply and demand. If 25% of the condos have a superior view, these will be more in demand and hence, get better prices, than the other 75%. If you are in the 75% bucket, you have a bigger pool to compete against to get people to pick your unit.

    0Reply
  • Karl McGarvey
    OP
    Real Estate Agent · Houston, TX · Member since 2019 · 763 posts · 500 votes
    6y

    @Glenna Wood I am so surprised that people like that view so much better. I expected people to like the pool/ocean vs parking lot ocean. But I love getting this feedback, really helping

    0Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    6y
    Originally posted by @Karl McGarvey:

    @Glenna Wood I am so surprised that people like that view so much better. I expected people to like the pool/ocean vs parking lot ocean. But I love getting this feedback, really helping

     To me the first unit seems closer to the ocean as if you could hear the waves.  The second one while you can see the ocean, it is much further away.  It also looks to be higher up.

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