All Forum Posts by: Alyson Gordon

STRs definitely are not dead! I do think that just like any investment you have to be picky and really evaluate a deal before buying it. A lot of it comes down to your specific property - you can do well in a dead market or do terribly in a hot market. With STRs, you need a good location, design, guest experience, and you'll do great. I think some people got into STRs over the last few years without doing their homework unfortunately.

I would starting by have a clear goal for your investment - is it cash flow, COC, ROE? It is just going to something to set it and forget it?

If you decide to go the STR route check for city, county and HOA regulations. STRs are also going to require a lot more cash up front due to furnishing it. STRs are a lot more involved and hands on but should generate a lot more income. If you decide to go LTR then I would focus on getting on a strong passive cashflow and making sure you have access to a good property manager unless you plan to self-manage. LTRs tend to be more hands off even if you do self-manage.

Either way, you'll need to practice analyzing deals so that you don't buy a property that doesn't produce for you :) 

Orlando is a tough market for vacation rentals right now in terms of strong cash flow. The rates (ADR) relative to the price of homes along with a lot of availability makes it less than ideal currently. I would consider looking at other markets, maybe still in Florida but perhaps stay away from Orlando for the time being. I don't own there but looked heavily into it and the returns weren't there. I am in 2 other markets with STRs currently. 

As a first step in any market I would look for people operating in that market to speak with before finalizing a market for a vacation rental. If this is strictly for investment purposes there are tools like STR Insights and AirDNA to assess further first. Happy to chat more if it helps!

@Erik Price my pleasure! Happy to brainstorm with you off line if you'd like

I live in Raleigh and have a close friend who is an active investor in San Antonio, TX. The purchase price of SFH seem to be a lot lower in San Antonion than they are in the Triangle area. I think it would be worth exploring that market as your money likely can go further. The Triangle is a great area bu tin high demand with a lot of people relocating here so you'll have a lot of competition with home owners and investors alike. Just another perspective :)

Hi Erik,

How do you plan on handling supplies and linens? I didn’t see those costs that reflected anywhere in the proforma. I’m especially thinking of hand soap, body wash, coffee, and then towels and sheets as needed.

Have you considered how you plan to manage pricing and messaging? If so, there may be additional fees for services like dynamic pricing or property management systems, especially if you plan on listing on platforms other than Airbnb.

Even if you’re going to clean and manage yourself I would get in the habit of paying yourself a cleaning fee so that if you decide to outsource that you can still cash flow.

I know the market can be tough at times to find the "right" deal a "good" deal but with patience you can stay in budget and achieve a higher ROI, COC and ROE. One place to start would be a tool like STR Insights or FB groups but you make your $ in STRs when you buy so it's ok to be picky and patient!

Hope that helps ☺️

IMO, the RTP area is going to be really challenging in the up to $300k range, let alone hoping to cash flow. I'm working with an investor now looking at $400k and under for STR and even with higher revenue projections its tough.

I don't have personal experience in Winston Salem but have a friend who bought a place there that he's happy with and says there was a lot more opportunity in that price point. If you consider areas like Winston Salem, Rocky Mount, Greensboro, etc. of course those are totally different markets from RTP in every possible way. I would start by finding an agent in one of those areas and seeing what they're seeing as well as talking with 1-2 property managers to get more info. The more info you get the closer you'll get to your answer! Good luck :)

I traveled to Europe for 8 days last summer and really regretted not being able to relax due to having multiple guests checking in/out at my 2 STRs. At one house, a tree fell down due to a random wind storm and another day at the cleaner was late/delayed and wasn't responding to my texts. I had to set my alarm on multiple occasions to make sure everything was going ok. Is it possible to do this remotely while traveling? Absolutely - technology won't be the issue. But if you can hand it off for a bit, you'll have a lot more fun during your time away :)

One of the most important factors when identifying an STR is location. In this case, I think the merit of this idea depends first on location and second on amenities. Most guests are not willing to pay a lot of money for an average, so-so experience. They will pay for a destination location/STR or for a really unique stay. I don't have first hand experience living or vacationing in a pre-fab home but generally speaking a budget friendly home is not going to be the best property for an STR that will generate a lot of cash flow. I'd suggest looking on airbnb to see what the competition looks like near the lot and consider how a pre-fab home would line up as well.

Congratulations on knocking your first STR out of the park! If you have 2 years of tax returns I believe you can count that as "income" in addition to anything you're bringing in for self-employment. It will take more time but consider looking for a seller-financed deal as well or partnering with someone to find a subto deal for you.