Ideas on how to buy New running Well STR. Owner needs to Sell NOW

Milwaukee, Wisconsin
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Ideas on how to buy New running Well STR. Owner needs to Sell NOW

Crystal Flower
Member since 2026 · 5 posts · 3 votes

If you got any ideas, I'd really appreciate it.

My ex husband and I started this STR. It went live May 30. We received 13 bookings in 5 days. June July August are booked almost solid. It seems to be well on its way to succeeding as a STR.

My ex husband needs to sell NOW and really wants to also walk away with some cash. Due to 2 1/2 years of a family illness, we both are tight on cash.

I would like to buy the house. I think we still fall into the arms length category. He could gift me some equity. He can even help with closing costs if needed. As of July 20, my credit score should be great.

I can either keep it going as a STR. I've talked to lenders about DSCR loans but it seems hard to prove future income and home value for the Loan to Value. Our STR seems to be doing better than the ave.

OR I can live there and house hack it by renting out 3 fully furnished rooms. It's pretty much already set up for it because we had to get ready for the STR. Due to the 2 1/2 years of taking care of the family Illness situation, I have not had 2 years of W2's. I am job searching now and running the STR.

I do not know anything about house hacking loans.

Does anyone know of anyway that still makes sense for me to get a loan and buy this already running STR?

Thanks for any help

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Jules Aton
MD/DC · Member since 2024 · 1k+ posts · 1k+ votes
4mo

Unfortunately in my experience STR isn't valued as a business. It sounds like you would be best served by purchasing from him as owner occupied and then pivot as indicated. It's a shame he isn't giving you more time because the STR sounds promising although I would raise my nightly price if rented that quickly.

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  • Jules Aton
    MD/DC · Member since 2024 · 1k+ posts · 1k+ votes
    4mo

    Unfortunately in my experience STR isn't valued as a business. It sounds like you would be best served by purchasing from him as owner occupied and then pivot as indicated. It's a shame he isn't giving you more time because the STR sounds promising although I would raise my nightly price if rented that quickly.

    2Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    4mo

    This is currently in your and your ex husbands names?

    How much equity is in the house? I'm guessing not a lot?

    0Reply
  • Mike GrudzienPro Member
    Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
    4mo

    This is a tricky one.

    0Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    4mo

    Post the address so we can get an idea of what you're talking about exactly...

    0Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 4k+ posts · 3k+ votes
    4mo

    I am not qualified to discuss the options available for you to purchase from him, I would speak to a lender preferably one that specializes in STR's or at least investment properties.

    As far as outright selling, listing on the open MLS (preferably with a STR specialized agent), or you can try to sell yourself via listing on Rabbu, Facebook Marketplace / Local Host groups / Classifieds here, there is an appetite for turnkey STR's at the moment.

    FYI having so many bookings so quickly is indicative of too low of an ADR, you can probably increase rate.

    Good luck!

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    1Reply
  • Jeffrey Abraham
    Lender · United States · Member since 2020 · 233 posts · 29 votes
    4mo

    You have a few options. If the property already has strong bookings, some DSCR lenders will consider projected STR income using an appraisal with an STR income analysis. If you plan to owner-occupy, FHA or conventional house-hacking may also be an option, even without two years of W-2s depending on your current income. I'd talk with a mortgage broker who understands both DSCR and owner-occupied financing before making a decision. Good luck!

    1Reply
  • Bill B.
    Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    4mo

    Is only he on the title? Only him on the loan?

    2.5 years later he SHOULD be able to sell for what he paid. If he sold to you he might even net what he paid if you avoided the 4-6% realtor fees and some closing fees. 

    Did he put down a bunch of cash he needs to get back or does he just need to get out of the payment? If he sells to you he should be able to net about his downpayment. If he sells to a stranger he’ll probably be lucky to walk away without having to pay too much if he put down 5% and with a couple thousand if he put own 10%. 

    If he just needs to get out of the payment I’d suggest you rent to own or rent with the option to buy from him. You pay rent equal to his mortgage payment with the option to buy within 1-3-5 years whenever you think you’ll be ready. Good luck. 

    2Reply
  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    4mo

    Yeah this is a mess. Sell the place and move on.

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    1Reply
  • Crystal Flower
    OP
    Member since 2026 · 5 posts · 3 votes
    4mo

    This property is in my ex husbands name. Title Mortgage etc.

    0Reply
  • Crystal Flower
    OP
    Member since 2026 · 5 posts · 3 votes
    4mo

    I do understand that I need to raise the price. We started it at a promotional price. I just didn't know it was going to book out that fast. I guess I didn't know the possible demand/desire for a 4 bedroom / 2 full bath with huge fenced in back yard. 

    0Reply
  • Jeffrey Abraham
    Lender · United States · Member since 2020 · 233 posts · 29 votes
    4mo

    I hope you receive the Information you needed to get the finances in order. Comps!

    0Reply
  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · Sarasota, FL · Member since 2017 · 5k+ posts · 3k+ votes
    2mo

    @Crystal Flower, If this deal's already closed, some of this may already be settled, but worth checking whether the divorce is finalized or still in progress either way, since that changes how the buyout gets treated tax wise. If you two are still legally married and this is happening as part of the divorce settlement, transfers of property between spouses incident to divorce are generally not taxable, no gain recognized on his side, and your basis in the property carries over from the original joint basis rather than resetting to a new purchase price. If the divorce is already final and this is happening afterward as a straight arm's length sale, that's a different tax picture entirely, he'd recognize gain on his half at sale, and any equity he gifts you would need to be treated as an actual gift with the appropriate basis and gift tax reporting, not folded into the sale price informally.

    On the STR versus house hack question, since you don't have two years of W-2s and are relying on the property's own performance, DSCR is still likely your best path given the strong booking history you already have, but if you switch to house hacking with three rented rooms instead, only the rented portion would get depreciation and expense treatment, the unit you live in wouldn't qualify, so that changes your tax picture from keeping it a full STR, worth deciding which structure fits your finance situation before locking in either loan type since it also affects what you can deduct going forward.

    Happy to connect!

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  • Diana KhanPro Member
    Attorney · 10451 Mill Run Cir #755 Owings Mills, MD 21117 · Member since 2024 · 792 posts · 285 votes
    2mo
    Quote from @Crystal Flower:

    If you got any ideas, I'd really appreciate it.

    My ex husband and I started this STR. It went live May 30. We received 13 bookings in 5 days. June July August are booked almost solid. It seems to be well on its way to succeeding as a STR.

    My ex husband needs to sell NOW and really wants to also walk away with some cash. Due to 2 1/2 years of a family illness, we both are tight on cash.

    I would like to buy the house. I think we still fall into the arms length category. He could gift me some equity. He can even help with closing costs if needed. As of July 20, my credit score should be great.

    I can either keep it going as a STR. I've talked to lenders about DSCR loans but it seems hard to prove future income and home value for the Loan to Value. Our STR seems to be doing better than the ave.

    OR I can live there and house hack it by renting out 3 fully furnished rooms. It's pretty much already set up for it because we had to get ready for the STR. Due to the 2 1/2 years of taking care of the family Illness situation, I have not had 2 years of W2's. I am job searching now and running the STR.

    I do not know anything about house hacking loans.

    Does anyone know of anyway that still makes sense for me to get a loan and buy this already running STR?

    Thanks for any help

    Hello @Crystal Flower! One thing I'd add is not to treat buying the house and taking over the STR as the exact same transaction.

    Since the property, mortgage, and title are all in your ex-husband's name, I'd want to know what happens to the existing bookings, deposits, furnishings, permits or licenses, platform account, and any guest agreements if you become the new owner. A house can transfer to you, but that does not always mean every part of the STR business automatically transfers with it.

    I've seen real estate deals get complicated when everyone focuses on getting the property sold but does not clearly document what else is included in the sale. Before choosing the financing, I'd make a list of everything connected to the STR and have a Wisconsin attorney and title professional help make sure the purchase documents cover what you actually intend to take over.

    It sounds like you’ve already built some real momentum with the property, so I’d want to protect that as much as the house itself.

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    0Reply
  • Matthew Tregoning
    Property Manager · Melbourne, FL · Member since 2019 · 561 posts · 196 votes
    1mo

    Did demand hold up once you moved off the launch price? That would be the part I'd want to see after such a fast start. Hope you were able to keep it going.

    0Reply
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