Vacation rental - is this a good deal?
Hi, guys!
I've been looking at this property for a while. Little vacation home in front of a nice lake, been for sale for some time. Basically the owner is moving on to bigger properties and this has become a pain in the neck for her to manage, not in terms of % yield, but absolute $ value x time it takes for her to manage.
Here are the pros:
-what stands between the property and the lake is a township-managed lot --> the property is basically lakefront, but without the high taxes associated with it.
-it's basically a small trailer, so she rents only for couples. No kids, pets, not a whole lot of damage to manage, mostly people looking for a quiet weekend getaway.
-incredible reviews on all major vacation rental websites, repeat guests.
The property was for sale for $110k and was reduced to $97k. I know she has been trying to sell this for at least two years, but she is not 'desperate' in the sense that it still provides good cash flow, just not an ideal situation for her. Yearly revenue is ~$22k and her expenses are around $6k net (not including cleaning, etc which are all passed-through to renters directly on Air BnB, etc).
Does this only come down to management? I wouldn't be able to manage it myself as I live 4 hours away. Sure, I can deal with bookings, etc, etc, but would need someone on the ground for emergencies, etc. Is this just a matter of finding someone who lives close by and is reliable? The numbers make sense to me but I'm reticent - it would be my first deal. Thanks for reading and looking forward to hearing your thoughts.