Under Contract on first STR - Oak Island, NC
Hi all. My wife and I decided to move from the LTR to STR. We recently sold an LTR and had been in the market to purchase a two or three long-terms or small multi. But based on the numbers, the STR seems to be the better -- even if more risky -- strategy. The market we have chosen is the Yaupon section of Oak Island (east end). The property is located in walking distance to the beach (2 min. walk) and several restaurants. The general area is also elevated such that most of the properties are out of the flood zone, including this one. Based on the numbers, we're not expecting to become millionaires -- but hoping to reach 20-25% cash on cash return for the deal.
We both work full-time and have small children, so the impending setup process is looming large. That is, of course, if we end up closing the deal pending no significant issues. We are diving in head first on educating ourselves on the setup process. Many thanks to fellow BPers and Joe Prillaman out of Carolina Beach for the inspiration to get the ball rolling.
@Wes M. Awesome stuff, Wes! Excited to hear more about this particular deal.
Originally posted by @Kevin Tornes:@Wes M. Awesome stuff, Wes! Excited to hear more about this particular deal.
Thank you sir. Purchase price is $460k, and I am hoping it will average $4500 gross as a basis. There is some cosmetic work needed -- this assumption is pending a good inspection. The property has berber carpet, so we will likely install LVP flooring throughout. The kitchen is small so considering painting cabinets, replacing appliances, and adding new countertops. The benefit of replacing those items is a question I have for the expert STR hosts. Is it better to get the property listed or wait to add those additional improvements? Thoughts anyone?
It has a newer roof, HVAC, windows, and siding. The property is a 3/2 with a bonus conditioned sun room. We are thinking of adding a day bed or similar for additional accommodations. I will provide some pictures once we are further along in the process.
If it's not too bad, I tend to wait on doing much rehab until slow season. In the Florida panhandle, I hear that is October through Feb. Not sure about your mkt.
@Gerald Pitts We are set to close on the property October 1st. The property is located in Oak Island, NC. In theory, we could have everything ready by November 1st, but I’m thinking it will be closer to December. Floors and paint are a definite.
Congrats!!! How did you find the deal? Oak Island is where I'd like to go next as we have several STRs in Western NC, and would like to diversify and go towards coast now.
ANy recommendation on real estate agent or your method for finding it?
Happy to help answer any questions related to setting up and managing STRs.
Joe
@Joseph Bafia Hey Joe, I had a realtor give me a heads up about this one before it hit the market. She knew the exact area and specs we were looking for. Got lucky they accepted our offer, but it was all due to relationship building. She had an idea of what the sellers needed from us to accept the offer.
I’ll reach out with some additional information via PM. I will certainly have some questions for you.
@Wes M. - Give us an update when you have a chance - still shooting for 10/1 closing? I'm interested to hear if you will be managing the STR yourself through AirBNB / VRBO or utilizing one of the local rental companies. Thanks!
Originally posted by @Charles Hoyer:@Wes M. - Give us an update when you have a chance - still shooting for 10/1 closing? I'm interested to hear if you will be managing the STR yourself through AirBNB / VRBO or utilizing one of the local rental companies. Thanks!
Hey Charles, I will be managing it myself. We are still set to close on 10/1, then the real work begins!
@Wes M.: congratulations on your purchase. Please continue to share your experience.
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Broker North Carolina (#316705)
- Spine Properties, LLC
Originally posted by @Michael Spine:@Wes M.: congratulations on your purchase. Please continue to share your experience.
We are still moving along. Renovation should be finishing up in next two weeks. Ended up doing all new floors, paint throughout, new sheet rock ceilings, cabinet painting, and countertop replacement. We are finalizing our furnishing list and buying items as we go. Once the contractors are out and all furnishing purchased, I will take a week off to get the house ready. I hope to find some cheap labor to assist with furniture assembly and other random items. If we can be up by Thanksgiving that would be great, but I would anticipate it will take well into December.
Met with a cleaner this weekend, and she pointed out my foolishness for choosing white paint for the interior. From her perspective, it will get ruined and require new paint yearly. So, we are definitely learning as we go. I guess that's the best way too learn.....
Hey everyone, wanted to provide an update on our progress. We finally listed the unit for service yesterday. I can say the last three and half months have been quite exhausting juggling this project, family, and work --- so we hope all the time and expense will pay off. Many thanks to everyone that has helped us along the way -- @Clint Harris @Joe Prillaman @Joseph Bafia and others -- we will need lots more help now that we are up and running.
We dove into this hoping for a COC of 20-25%, hopefully this time next year we will have achieved that goal. Ultimately, we spent approximately $23k on reno and another $18k on furnishing, though the dust is still settling so those numbers may be a tad off. Based on those numbers, we will need to net $21,000 after all expenses. We are looking at prime nightly rates of $350-375.
I have included some before and after pictures below. The link to the listing is also provided. Please let us know if you see things in the listing that should be tweaked.....oh and maybe hit that heart button in the top right!!
Looks great Wes - Thank you for sharing and wishing you all the best in the coming year!
Congrats "Neighbor"! (neighboring beach that is).
Best of luck and hope to share ideas, stories and strategies with you going forward!
Strong work man! Proud of your success, can’t wait to see your journey and the way this listing blows up right around the corner
Originally posted by @Clint Harris:Strong work man! Proud of your success, can’t wait to see your journey and the way this listing blows up right around the corner
Thank you sir! Ramping up the knowledge on calendar availability, pricing, and automation now!!
@Wes M. great job buddy...you killed it. Wishing you continued success and hoping to connect in the near future to talk about our real estate adventures, successes (maybe some not so successful stories) and future plans.! Best wishes for 2022
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Broker North Carolina (#316705)
- Spine Properties, LLC
@Wes M. The place looks fantastic! Best of luck to you in the coming busy season!
@Wes M. great job on the property. I am in contract with our first ever investment property. We will be in a condo west of you on Oak Island. Should be ours in a month and thee is a long term tenant in until April. Can't wait! maybe we can meet up one day? Best of luck.
Originally posted by @Ted Caputo:@Wes M. great job on the property. I am in contract with our first ever investment property. We will be in a condo west of you on Oak Island. Should be ours in a month and thee is a long term tenant in until April. Can't wait! maybe we can meet up one day? Best of luck.
Congratulations sir! I'd be happy to meet or chat anytime.
We have four bookings so far -- our listing went live just last week. I am already projected to beat my December to March revenue estimates, without December or January. I am learning more each day and hoping our first few guests are kind and everything goes smoothly.
@Wes M. can you give me the name and contact number of the realtor you worked with? I’ve been looking to get a place in same area doe a while.
Good luck with your place. It looks amazing!
Thank you
Jeff
Originally posted by @Jeff Gold:@Wes M. can you give me the name and contact number of the realtor you worked with? I’ve been looking to get a place in same area doe a while.
Good luck with your place. It looks amazing!
Thank you
Jeff
Thank you -- I will shoot you a DM with an agent recommendation.
Super cute furnishings! I love the blue lower cabinets, too. I'm glad you posted an update.
@Wes M.do you have a good GC you would refer? What about a realtor? TIA!
Thank you Wes for sharing your STR experience. Can you give us an update on how it goes so far? I am a LTR investor and looking into STR right now.