Newbie First STR in TC, Mi

[Derek Larson]

Investment Info:

Single-family residence other investment in Traverse City.

Purchase price: $280,000
Cash invested: $116,000

Single family home, 2 bed, 2 bath on all sports lake. Second home purchased with first plan to make it a STR and use it when it was not being rented. Summer is prime rental season and we will use it for cross-country skiing in the winter time. Other draws in the area with wine tasting, snowmobiling, down hill skiing, state and national parks.
Major draws of a smaller home, low maintenance and landscaping- the rehab was mostly cosmetic.
#northernechocottage

What made you interested in investing in this type of deal?

We love Northern Michigan and Traverse City. I have wanted to get in the investment game for a number of years now. This was a way to get my wife on board. The idea of having something tangible and be able to use was a draw, of course the kicker was to be able to explain the income opportunity for it when we are traveling- especially in the summer.

How did you find this deal and how did you negotiate it?

Months of searching mls

How did you finance this deal?

saved a large down payment from years of saving as well as relocated back to the area and sold our home in a hot area in PA.

How did you add value to the deal?

Mostly painting. The home was vacant and a bit overgrown, did a lot of tree trimming, but furnishing from our last home which we downsized on our primary.

What was the outcome?

We enjoyed it all of last summer, listed for STR mid September- booked almost all the weekends from then through early November. Hoping for a couple winter bookings, but going after spring, and we have a couple week stays booked for next summer already.

Lessons learned? Challenges?

I won't lie, got a little lucky on a few things. I had to work harder to make a few things work. I didn't know my numbers as much as I thought. I give myself a solid B-. But for the first one we are very happy. I overestimated the year round rental a bit, underestimated the summer nightly. I know I got a little house fever and really wanted to lock down a lake house. Speaking cash on cash i might not have played it quite the same- this box is not big enough for all my lessons and challeg