Real Estate Deal Analysis & Advice

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Justin Gabrielli
  • Investor
  • Texas
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Analyze my deal? First deal ever

Justin Gabrielli
  • Investor
  • Texas
Posted Jan 25 2022, 12:02

Hey everyone, I wanted to see what potential blind spots I may have in my short term rental deal. This is my first property every so be easy.

Back story I bought some land at the end of 2020 within eye sight of a lake. The land was a great deal at 30k and has since risen in value along with other land being sold near by with expensive properties being built both lake side and interior lots ranging from 150k-850k with similar acreage in a gated community. During this time we have been saving and I have laid a drive way and other wise prepped the land for the build. 

We thought we would build a traditional lake house or 2nd home but now I feel its better suited for a short term rental due to having a baby in June and not wanting to put that much $ out there but also wanting to keep the land for the future. I want to keep myself liquid for the moment so am going to tap into 50-65k in my primary residence at 5.5%.

Which brings me to numbers, does this make sense?. 

Land cost; 30,000

All in cost estimate (A lot of my savings come from my ability (actual ability not just YouTube DIY) to do a lot of the work and its a small build) + Land = 80-85k. This is a container house if you are wondering why costs are so low. 

Conservative rents for the area with similar set up for Winter; 120-140 / Summer 180-220 

I did math at 60% vacancy in a winter month showing 1440 per month. Factoring in operating costs estimate around $655 (Maintenance, insurance, utilities, vacancy, taxes) that yields NOI of $784. After paying loan (305-350) that's around $500. (Not including cut from Airbnb or VRBO)

In short meaning the great months the cash flow is pretty great. Is that math sound?

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