Hey everyone! I am new to real estate investing and I just closed on my first home. My plan has been to live in it for a year, make some renovations and rent out rooms and then save to purchase my next property. Now I'm thinking, why wait? There a cheaper options to get into a deal and what I am interested in now is to purchase a small piece of land and renovate an RV and put it there as a "glamping" Airbnb. I'm asking for any advice from someone who has invested in a "glamping" Airbnb property or potentially anybody who may be interested in investing with me to get this started! My name is Michael and I appreciate you reading my post!
Your main issues will be electrical, water and sewer.
How do you plan to provide these and what is your budget for them?
You may want to take a look at some of the properties and camp setups on Hipcamp.com. You might also want to stay at one just to see how it all works.
We've stayed at a few and for toilets, they either used a port-o-john, and had a commercial service come and empty it before we arrived or a composting toilet. We actually preferred the composting toilet because there were less chemical smells, etc.
Both camps we stayed at had us bring our own water.
Neither of the camp sites had electrical, but we could bring our own generator or battery system if we wanted.
@Bruce Woodruff - I've heard this before. Ideally the site would have these utilities ready. I'm looking in Gatlinburg, TN near the Smoky Mountains and I've found a couple properties that have utilities ready but I need to do more research. Some have utilities "available" but I'd imagine that would require me to have the utilities set up by the local providers. So long story short I don't have too much of a budget to set up utilities. Either I find a property with utilities set up or I go a more barebones approach and find a way to provide services without public utilities. What are your thoughts?
@Mike Shemp - Yeah that's a good idea. It would be a good reason to get out for a weekend haha. But yeah, boots on the ground research is always key. How did you feel about having to bring your own water and having a generator for power? I can see an aspect of it that would be kind of fun but also inconvenient.
What's your budget to purchase land that already has utilities available?
You providing the campers or just renting space?
Keep in mind that land loans aren't the same as owner occupied loans.
You'll need at least 20% down, and you'll probably encounter a balloon (usually 3 or 5 years). The amortization period is typically 15 years (though I found one local credit union that'll do a 30 year). Debt to income ratio is limited to around 41% instead of 50%. Lastly, you can expect the rate to be in the ballpark of 6-8%.
Then you have to worry about getting utilities to the property, if they aren't already there.
I would also assume that you would have to make the place look half decent. If I were paying for a short term rental, I probably wouldn't care much for an RV sitting in a bunch of weeds. At least have some nice grass (aka irrigation) and landscaping, and probably a fence in case someone brings pets. Driveway for parking.
There's a lot of costs that would probably make this difficult to justify over just getting a single family home and renting out the other rooms, but that's just my opinion.
If you haven't already, check out Robuilt on youtube. He's also BP podcast 492.
Let us know how you do!
You gotta think older vs younger folks. When you're in your 20s to 30s, roughing it is actually fun....As age sets in with the accompanying aches and pains, it's a whole different story.......So you will lose half your potential audience if you choose to go 'rough'.
I'd get a place that has both if possible. Some people would like the experience of roughing it.....
We were fine with it, but that could also be because it was in line with our expectations. Both camps we stayed were not advertised as glamping, so we were totally fine with brining our own water and generator.
Now if it was advertised as glamping, and was paying a premium for the glamping experience, and had to bring my own water/generator, then that would be a negative experience for me.
I think you'll have to factor in the logistics of who will clean up the camp, will it be difficult to get bedding in/out of the glamping tent, who will refill the water jugs, who will recharge batteries, etc. and that might help you decide if you are deciding between glamping experience or standard hipcamp experience.