Charleston Airbnb House Hack
Investment Info:
Single-family residence buy & hold investment in Charleston.
Purchase price: $354,000
Cash invested: $10,620
This is my first deal! A short term rental/house hack, the property has a 350 sq ft ADU in the back yard that I have listed on air bnb and that should cover all of my housing costs. We painted, did light renovations, and went through the Charleston STR permitting process and now how a live Airbnb listing.
What made you interested in investing in this type of deal?
I was interested in house hacking but the market for small multifamily in Charleston is very competitive. Duplexes would go very quick or to all cash buyers. I was able to use a 3% HomeReady loan and get into a neighborhood I like, with little money down, and live for free.
How did you find this deal and how did you negotiate it?
My real estate agent brought me this deal, it was listed on the MLS. I was able to knock $11,000 off of the listing price by using the comps price per sq. ft. in the neighborhood. There was not much differed maintenance or value add to further reduce the price.
How did you finance this deal?
Home ready 3% down loan enabled me to put down a reasonable down payment and not have to save up 20%.
How did you add value to the deal?
The ADU needed painting and a deep clean, the furnishings and decorations were outdated as well. We painted, cleaned, fixed up a few things, and put our own personal touch on the place.
What was the outcome?
I went live on October 11th and have had someone staying ever since. This is a slower season then the spring and summer but I have already exceeded the historic October and projected November numbers from that the Seller provided.
Lessons learned? Challenges?
I learned that the Airbnb permitting process in Charleston is a lot more time consuming, costly, and challenging than I would have thought. I learned that it would have been better to have had a little bit more reserves for expenses while getting the unit fixed up and ready and before I was getting revenue and had to pay the full mortgage. Also, I learned ways that the seller hid things that needed fixed and to take a deep look during your walkthroughs.
