The Yay Chalet - my first STR

[Anthony Chao]

Investment Info:

Single-family residence buy & hold investment in Gatlinburg.

Purchase price: $500,000
Cash invested: $100,000

The Yay Chalet, a cozy, modern, instagrammable A Frame home in the ♥ of Gatlinburg.

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

Before I bought The Yay Chalet, I owned three LTRs in Northern California. My portfolio was appreciation heavy and I wanted to add more cashflow.

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

My research led me to Cleveland, Ohio. My goal is $20,000 per month in rental income. It would take a long time and a lot of properties to build up to $20,000 a month with properties that made $200-$400 a month.

I met someone who invested in LTRs Cleveland, but then switched to STRs in the Smoky Mountains. I built rapport with them and dove right in.

I found this deal off-market via a Facebook group.

How did you finance this deal?

10% down vacation home financing at 3.06%. Sahweet.

How did you add value to the deal?

It was unfurnished. I like interior design. I treated it like a blank canvas. Aesthetics work.

What was the outcome?

Some serious cashflow so far.

Lessons learned? Challenges?

It takes a lot of work to set up an STR. Helps to have a solid knowledge of Real Estate investing, Technology, Marketing and Customer Service helps a lot.

I learned about Material Participation, which would allow me to offset my W2 income. I expect to be able to write off 20-25% of the purchase price in 2021 tax season (Cost Seg).

[Bonnie Low]

Nice! @Anthony Chao. Can you share who the lender is that you used?