Pulling money out of a property
Hello Everyone, I am happy to be a new member of bigger pockets. I am a real estate broker in Arizona. I have been a licensed agent for 3 years going on my 4th year and now a broker. Sales have been such a rollercoaster here I want to explore different avenues as well. I have been dabbling in Airbnb since 2016 when I bought my first property and remodeled it. I bought for $268k and last year it was worth 1M. My neighbors have since joined the Airbnb gang and they make around $75k a year with a pool which used to be $120k NET a couple years ago before a little saturation. With all of that being said I do not self proclaim myself as an investor. I am strictly sales and have owned a marketing company for a long time as well. Sales is where I excel. I have a lot of friends who invest / flip / build etc and I have done it once with success. My question is this. I plan to Airbnb my home. My expenses will be 20k a year and I will Gross around $75k. I have $800k in equity right now but I have bad credit in my current situation. I am ready to expand but take calculated risks. I am scared to pull money out of my home unless it is generating income in which it will this year. I want to buy property after property after property and I am looking for strong advice on what to do. There are a lot of people who are not trustworthy in this industry so It would be good to hear what season veterans have to say. I know I am a Millionaire on paper but it certainly does not feel like it lol. I look forward to hearting from all of you and thank you for your time.
Most Popular Reply
Hi Zach!
Depending on your current credit situation, some private money lenders are starting to do DSCR loans on STRs. In the current market, cash-out refis are dominating private money. Most of the investors I work with are pulling every bit of capital they can out of their current portfolio and purchasing additional properties. $800k can go a very very long way, depending on what you want to do with it and what market you are working in. I am also in AZ and know that competition is fierce, but you have more than enough equity to work with.
While I am not an experienced investor, I would suggest working on improving your credit and getting the AirBnb going. Then, use that pile of equity to acquire more properties. You don't have to pull out all $800k either. If you choose a good lender (PM me when you're ready) they will help you mitigate risk and work out a deal that you are comfortable with.