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58
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Jim Stanley
  • Denver, CO
27
Votes |
58
Posts

Please critique this plan for Florida short term rental

Jim Stanley
  • Denver, CO
Posted

My wife, daughter, and I live in a suburb south of Denver, CO. We have a SFR residence and a SFR rental just down the street that I self-manage.

My wife is from Ecuador and hates the dry climate in Colorado also the cold winters.  She would much rather live in Florida.  I hate Florida, and more importantly, I have a REALLY  good job in Colorado and would likely take a big pay cut anywhere else.

My wife suggested we buy a Short Term Rental property somewhere in Florida.  She could go there in the winter/spring and our daughter and I could visit occasionally.  When my wife isn't there, we would rent it out through AirBNB or similar.  We would obviously need to employ a property manger.  We would be looking to at least break even on cash flow, but with property management fees and not renting it out 2-3 months per year, I'm not sure.

I bought our SFR rental with 20% down using post-tax money from selling our previous residence. I don't have enough post-tax cash for a down payment on another property but I do have pre-tax IRA money. I think it's possible to use that, but I have not educated myself on the pros and cons.

Is this feasible?  Suggested locations?  My wife is thinking Destin, but we really don't know (we go to Cocoa Beach a lot, but the prices there have really gone up lately).  Any major pitfalls to avoid? Any other comments suggestions appreciated!
Thanks!

  • Jim Stanley
  • Most Popular Reply

    User Stats

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    Aaron T.
    • Developer
    • Aguada, PR
    278
    Votes |
    927
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    Aaron T.
    • Developer
    • Aguada, PR
    Replied

    I hate to be the bearer of bad news, but if you are living in it and paying property management the rest of the year, you will not cash flow. 20-25% property management for STRs quickly eat into most cash flow when buying in todays FL market.

    the STR market is saturated and continues to get worse. in turn you have less occupancy and less income. in the next year or so, we will evaluate if the STR market is viable anymore where we are at.

  • Aaron T.
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