All Forum Posts by: Alex S.

The Salt Lake City to Bozeman corridor is really interesting to me.  Especially for flips or STRs.  High growth that may be just the beginning of a major generational shift away from big cities.  Incredibly beautiful scenery!

If the property is in an area near a hospital/military base/refinery/university/etc...you could furnish some units really nice and list them on furnishedfinder.com and do medium term rentals.  You'll bring in far more rent and turn over tenants every 3-6 months.

Also, you could split a 2bed/2ba into 2x 1bed/1ba.

Always love to hear updates, thanks!

@Rohin Dhar I love Park City...but I just couldn't ever make the numbers work there. Good luck anyway!

I don't see any difference between a property that is 3hrs away or 30hrs away.  You can't make that drive to solve a guest's problem right away.  Both are too far.

If your STR is 5min up the street, then ok, I guess you can learn the ropes a bit by being close to home. That experience will probably cost you the systems you need to scale, unfortunately. All of mine are within 10min of my house...for that reason, I've never found a consistent handyman solution. Probably best to just get the investment that makes sense and build the systems around it.

Like the other folks said, I'm curious what the partner would do? Typically, STR arbitrage is a way to "get into the game" with very little money. It allows you to learn the ropes and get a bit of cashflow to hopefully purchase your own STR.

Arbitrage does not hold many of the long-term benefits of real estate investing (taxes, appreciation, etc)

Oh ok.  Like most of what I type on here..."it depends."

My STRs have all been in suburban metro markets (i.e. not vacation hotspot rentals).  I have to price Fri/Sat nights 25% higher than other nights.  If I don't, all my weekends will book immediately and I'll struggle to fill the Sun-Thurs nights in between.  If I jack up the Fri/Sat night prices, it slows down the "weekenders" and other people will book 4-5 night stays.  I maintain ~82% occupancy in the winter and ~94% in summer.

With that said, I don't know if the philosophy is exactly the same in the vacation markets...especially in places where the minimum stay is 5 nights or more.

In any case, you definitely should not price all nights the same all year.

On the buy side...I don't see why you wouldn't use a Realtor. The system is built to prevent buyers from representing themselves on an MLS deal. A lot of brokerages won't even allow it. Since the seller has likely already signed an exclusive representation deal with their agent, you either abide by their rules or don't play. If it is off-market, and you feel comfortable knowing the market...ok sure.

On the sell side...I can't imagine why you'd use a Realtor unless you are just looking for expensive admin help.  As an investor, you should understand the process better than the average Realtor.  All Realtors have 1 prime incentive: close the deal.  Good deals, bad deals, questionable deals...the best Realtors will close all of them and move onto the next.  That may or may not be in your best interest.

What formulas are you using?

I'm not sure I understand the question.  Are you asking about length of stay discounts?  Like, how much to discount for week-long or month-long stays?

Really interesting perspective, since you've worked for a national STR management company. I'm curious, do you think AirDNA's numbers skewed a bit high because STRs that WEREN'T managed by a national company did better on occupancy? Obviously, the example you gave of 70% expectation vs. 55% best case is a pretty wide split.

Estimating occupancy is fairly difficult for someone just starting out in STRs, and the cost of missing it by 10% is pretty big. I was helping a couple that wanting to buy a house and remodel it for STR. They wanted to use 50% occupancy in a market ("just to be safe") that I knew would bring 80%...so they didn't buy the deal because the numbers weren't that compelling. Of course, at 70-80% occupancy it would have been a home run.