All Forum Posts by: Ben Scott

@Blake Billings have you had an issues with the neighborhood association. I know some historic areas in OKC frown upon short term rentals. 

Congrats @Blake Billings on the project. Hope things are going well with you!

Quote from @Kenny Ng:

I am thinking of turning one unit of a duplex in Indiana as a short term Airbnb rental.

I have a question: What percentage of your income goes toward expenses such as cleaning fees, commissions, insurance utilities, supplies like toilet paper, etc?

I have a short term rental in Oklahoma City and I keep track of all my income and expenses on a spreadsheet. I spent around $650 in 'supplies' in 2021. I categorize supplies as toilet paper, paper towles, trash bags, hand soap, etc. Not sure if there is a yard at your duplex. But I also spend $630 on lawn care to have it moved twice a week in the spring and summer. The Obviously your taxes and insurance will vary.

Congrats on your ambition! I'd look to find a mentor in your area that will let you job shadow. You can read all the books in the world but some good 'boots on the ground' lessons are valuable, as well. And look to start growing your network with REIs or other meet ups. You net worth is determinted by your network!

I'd second the above comments. And also makes sure to close the transaction at a title company. You want the title to be in your name. Then generate a lease purchase/owner finance mortage and note with the seller that is filed with the county. Have the backing of public record in case the owner ever tries to back out of the deal. I've heard horror stories of tenants thinking they are paying down a rent-to-own mortgage based on a doc signed at the kitchen table. Then the owner sells the house out from under them.

Would you need a PM for just one property? Rent collection is done since Sec 8 direct deposit the rent into your account. And sounds like you're inheriting a tenant. 

Yes, I estimate I net quite a bit more than if I rented as a long term rental. Estimated rent for that area would be $800-$850 and I routinely gross $1500-$1800. Of course, my nut is bigger carrying all the expenses but it nets more. WAY more work also. HAHA.

I had one side of a duplex in Gatewood area come open recently and just converted that one bedroom into an Air BNB on Feb. 1. Spent $4k to furnish it, all told. Already had out first guest and review! 

Hey @Doug Spence, thanks for the note. Most of the feedback I've gotten from guests is 'great house, sketchy area.' The neighborhood's bark is worse than its bite and I haven't had any issues in two years. And the area is slowly gentrifying. But it's still mostly in the path of progress. I've thought about marketing directly to medical professionals but really my guests have been all kinds; contract work at Tinker AFB, in town for events, vacations, weddings, etc. Even with the location, the unit is filled 90-95% of the time.

As for the 15 year, this lender only does 15 year loans on residential. And the cash flow still worked on the 15 and I'd like to pay it off sooner rather than later. The lender is so easy to work with that it made sense. 

Investment Info:

Single-family residence buy & hold investment in Oklahoma City.

Purchase price: $98,000
Cash invested: $36,000

Short term rental in northeast OKC near OU Medical Center

What made you interested in investing in this type of deal?

I've been very interested in the Air BNB space. I sold a previous rental property and used the $36k proceeds as a downpayment on this home using a 1031 Exchange. This home had already been remodeled and was in great shape. But it wouldn't sell! Reason: the buyers were FHA and there is a loft above the garage that serves as a third bedroom. Appraisers would not give credit for that square footage due to the ladder to access the room being too steep. So I got a fairly good deal. The seller was usi

How did you finance this deal?

Local community bank with a 15-year loan.

How did you add value to the deal?

Added some furnishings and marketed the home as a short term rental.

Lessons learned? Challenges?

The neighborhood doesn't lend itself to a short term rental. So I've had to be honest with guests around the surrouding area.