All Forum Posts by: Bailey Kramer

A big part of the problem with STR is that people fail to accurately account for expenses and exaggerate their income. I'm not hacking on you, but I'm going to hack on you because I love to dig into this stuff.

A mortgage of $100,000 at 8.5% is $8,760 a year and property tax probably runs around $1,400. That's over $10,000 but you only list $7,323? How are you saving $3,000?

Where's the property insurance that runs an average of $1,600? It seems PITI would be over $11,000 so I'm missing $4,000 or more from your accounting.

Maintenance is typically 10% of the rental income, which would be $3,200. Is that included in your expenses? Average utilities in Indiana are $365. Add internet and you're looking at a minimum of $5,000 and that assumes your Tenants only use an aveage amount of utilities, which is unlikely. Then you've set nothing aside for capex. I would expect your expenses to be closer to $10,000.

Here's the expense missed by 99% of all posters: your time. Let's be conservative and say your time is only worth $20 an hour. If you spend five hours a week on this property, that's $5,200 you could have made stocking shelves at Walmart during that time. You have to account for that in your expenses.

Bottom line: I'm digging up $10,000 - $12,000 that's not accounted for in your numbers. Am I missing something?

Hey Nathan, I appreciate your response!

- As far as the mortgage goes, the loan amount was $80K (Yes I put down 30%!)

- My utilities are DIRT CHEAP and I honestly don't even understand how to be honest. My electric, gas, and water total about $100/month, and internet is $60/month.

As far as capex and maintenance go, I did mention that capex isn't counted in the #'s because right now i'm saving all of it and will re-invest the cash into another property (while leaving a healthy # of reserves in the account that is currentyly collecting 4.5% interest)

Maintenance has averaged less than $100/month, but ofcourse months in the future could vary!

Just a side note - I took all of these #'s straight from my P&L

1 Vote

Quote from @Sandra Morrison:

@Bailey Kramer Do you have any tips on how to do it with vrbo?

Yes! So a key note here is that you can transfer the REVIEWS, but NOT the listing.

Soooo....

Step #1 The new owner must create a new VRBO Listing

Step #2 The old owner must contact VRBO (very easily through chat support) and give the Listing ID of the new VRBO listing and let them know you want to transfer reviews.

Step #3 Wait! It only took a few hours last time I did it, but ofcourse ask VRBO for an ETA

I hope that helped and let me know if you have any other questions! (:

2 Votes

Quote from @Ashley Barlow:

Hi, Does anyone know if it’s possible to transfer a current Airbnb property to a new primary account holder to keep the reviews?

I have management company that I’m parting ways with and I would like to take over the current account. Does anyone know if this is possible?

Unfortunately, Airbnb doesn't allow this. It is possible on VRBO and i've done it several times, but Airbnb won't unfortunately!

0 Votes

Yesterday I shared how much a property I Co-Host GROSSES ($100k-$115k/year) and people wanted the NET number. Since I'm the Co-Host for that one, I don't know the net and I'm paid off of the GROSS revenue (20%).

So I wanted share how much one of the Airbnbs I own made in 1 full year. My goal for this post is simply to inspire and also show that it is possible to make money even with high-interest rates!! If you have any specific questions, throw em below (:

Let's get into the details:

Purchase Price: $115K (turnkey AND came furnished)

Interest Rate: 8.5% (DSCR Loan. I was 22 when I bought it and banks didn't like me not having a W-2 Job #entreprenur)

Location: Indiana

Strategy: I ran this property as a STR/MTR Hybrid

Total Revenue: $32,609

Expenses: $7,639

PIT: $7,323

Net Profit: $17,647

Important notes:

1. I've been running this property for 10 months now so I extrapolated the data to show the full 12 months. We have a mid-term guest so I know the exact revenue and expenses for the next 2 months*

2. Capex isn't included in those #'s, although I've kept all of the money I've made in the account as a reserve at the moment. When I buy another property, i'll use some of the funds to help with the purchase, and leave a healthy reserve in the account!

Have comments or questions? Feel free to throw em below!

1 Vote

Quote from @Dan Thomas:

@Ryan Moyer

More of a general statement about posts regarding STR, not necessarily specific to that property. I feel like every STR related youtube video or BP post showcasing how successful a property is seems to highlight gross revenue. Personal pet peeve I guess. For all I know they are loosing money hand over fist for all the reasons you mentioned and many more.....

IYea I totally agree with you!!! I'm just the Co-Host on that property, so I don't own it. I have no idea what it netted because I don't know how much the owners paid in expenses for mortage, taxes, insurance, utilities, etc. etc.

I get 20% of the gross revenue so that's why I shared the gross #.

I'm with you though, for properties that I own, I always share the net!

0 Votes

Quote from @Dan Thomas:

@Bailey Kramer

Don't understand all the hype in STR about what properties gross. I personally couldn't care less. That number is meaningless. What did it net?

I'm just the Co-Host on that property, so I don't own it. I have no idea what it netted because I don't know how much the owners paid in expenses for mortage, taxes, insurance, utilities, etc. etc.

I get 20% of the gross revenue so that's why I shared the gross #.

I'm with you though, for properties that I own, I always share the net! Maybe that'll be my next post breaking down all of the revenue and expenses for the ones I own! Thanks!!

0 Votes

Quote from @Sarah Kensinger:

Quote from @Bailey Kramer:

Quote from @Sarah Kensinger:

So, what is the deal with you crashing in here again posting all these tips. :D

Just adding value LOL. I've learned a ton on Bigger Pockets and other social platforms from people sharing free tips, strategies, and experiences, so this is 1 way of paying it forward.

When I was a sophomore in College I hopped on BP and binged the podcast, networked my butt off, and honestly without it I wouldn't be where I'm at today!

I totally get that; I know who you are and your story. But showing up almost every day to get "in the trenches", when people have problems tends to help out more.

Never would I have thought I'd have backlash for giving free value LOL

I talk to people every day who NEED the info that I share. I'll send my text exchange with

@Emily Hammer below (From August 10th). She saw one of my posts talking about Mid Term Rentals and message me so I hopped on a phone call with her and sent her free resources. I didn't ask her for a dollar or pitch her anything. Just here to help!

The whole point of me getting in the trenches is to help people who have problems with their property or to help people just starting out.

WARNING: I'm going to be posting A LOT more VALUABLE FREE content here. So for you or anyone reading this that is bothered by me sharing tips and tricks to help you start or grow your STR or MTR biz, I recommend blocking me LOL

0 Votes

Quote from @Michael Baum:

Just a quick question @Bailey Kramer, what do you charge for PM services?

Do you pay for all the service folks to go out when something requires physical attention?

20% of the gross. And no, the owner pays for the service folks to go out when something requires physical attention

0 Votes

Quote from @Allen Duan:

I'd love to hear your experience housing construction workers. We've had a handful of bookings from them and all of them trashed the place and required a super deep clean after move out. We had security deposits that we kept so it wasn't a financial issue, just a burden for my team to turn around. I'd like to spare them from cleaning up mold all over the kitchen and super gross bathrooms.

Otherwise, we've had the same findings for the properties we manage in Los Angeles. Studio and 1 bedroom units have high demand with travel nurses and other individuals or couples. 3 bedrooms and larger have great demand for insurance placements. 2 bedrooms have been slower for us this year.

Oh wow, I'm sorry to hear about your experience with the construction workers! I honestly haven't had any bad experiences with them. I even had 2 construction dudes and a cat (which I typically don't allow) and they left the place better than when they came! I ofcourse vet all my guests as it sounds like you do too. Maybe a case of bad luck?

Also IDK if it makes a difference, but my MTRs are in the midwest, not sure if the people are just nicer over there hahah

0 Votes

Quote from @Ron Brady:

@Bailey Kramer and @Allen Duan. My wife and I appreciate your sharing. Could you also please share how long you have been running MTRs and how many you have? That context really helps. Thank you!

Hey Ron! I'm glad you are finding the tips helpful! I've been on Airbnb since July 1st 2021 (a bit over 2 years). Right now I have 10 properties that I run as either strictly a MTR, STR, or Hybrid/mixture!

1 Vote

All Forum Posts by: Bailey Kramer

Bailey Kramer has started 65 posts and replied 212 times.

Post: NET REVENUE (NOT GROSS) from 1 of my properties

Post: Transfer Airbnb Account to new host

Post: Transfer Airbnb Account to new host

Post: NET REVENUE (NOT GROSS) from 1 of my properties

Post: Operating Airbnbs without EVER seeing the house

Post: Operating Airbnbs without EVER seeing the house

Post: Operating Airbnbs without EVER seeing the house

Post: Operating Airbnbs without EVER seeing the house

Post: Best property size for a mid term rental

Post: Best property size for a mid term rental