Non Vacation Airbnb?

Question

I have 3 successful SFRs in nice B neighborhoods, recently I have been networking with local REIs and came across a couple investors that have multiple Airbnb’s in my area. We do not live in a vacation destination and are about 46 minutes outside Pittsburgh. I guess I’ve always equated Airbnb or STR with vacationing but these investors are doing quite well and smashing ROI compared to normal rents in the area. My question is does anyone on here own STRs in non tourist areas. How are you guys doing with this?

Don Konipol · Answer

@John Matthew Johnston

Probably the biggest obstacle for STR in non vacation areas are local laws, regulations and ordinances.  These are driven by (1) local owners not wanting to change character of the area, or deal with noise, parties, transients, etc, and (2) lower income advocacy groups afraid it decreases residents housing stock and increases local rents.  Seems like the most common regulations are (1) minimum rental period, usually 30 or 90 days (2) licensing requirements with the number of licensees being fixed (3) area exclusivity such as must be at least 600 feet from another STR and (4) applying hotel regulations such as occupancy tax, etc, to the STR.

When my daughter was running a STR business very successfully in NYC in 2015-2016, the city decided to fine the apartment building where she had the STR leases $10,000 per day per unit for violation of safety codes.  Needless to say the apartment buildings terminated her leases and hence her business.

Patricia Taveras · Answer

@John Matthew Johnston

Hi John. My husband and I are doing great with this. We have three Airbnbs in nice B neighborhood as well, and we're killing it. We have a little more tourism than we thought we would have when we got started - we're in a small city 35 miles from the beach in NC. But a lot of our guests come into town for work or to visit family. Our lowest monthly occupancy rate so far has been 85%. We are cash flowing over $1,000 a month per house. Our only "slow" months in our area are January and February- and honestly we did extremely well those months this year.

Robert Carter · Answer

Yep I have one in a college town. Where we mostly received parents, and folks coming to college sporting events. They do pretty good throughout the year. It dwarfs long term rentals in the area with less stress on the property. I highly recommend it the only thing I would suggest is to make sure you don’t have a HOA and if you have neighbors make sure they have your phone number and try to implement rules not to disturb the neighborhood too much.

Paul Sandhu · Answer

I'm in a non tourist refinery town. Refinery contractors (welders, pipefitters, electricians) are my typical str renters.

Carolyn Fuller · Answer

Airbnbs started out in urban areas which is not your typical vacation destination. My husband and I have stayed in Airbnbs anytime we would have stayed in a hotel. For instance, if we are driving long distance and need to stop for the night, we will look for an Airbnb. The prices need to be competitive, not only with other Airbnbs in the area but also with the local hotels.

John Matthew Johnston · Answer

@Don Konipol

Thanks for the information, sorry to see they did that to your daughter.

John Matthew Johnston · Answer

@Patricia Taveras

Love it! Great Job!!!

Non Vacation Airbnb?

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