All Forum Posts by: Account Closed

Agree with the above in general, with the summary thought that the past matters not one itty little bit. Here you are, with this house, and whether you paid $20k or $2M, you still have to decide what serves you best now and in the future. In general, renting at mildly negative cash flow is OK, IF you're stoked on market gain potential and debt paydown, which in this case are well-leveraged by your low-equity position in the property. However the hassle factor, even with using a manager, may erase this. 

On the selling side, you'll typically lose around 6-12% of ask price to MLS fees, closing cost help, repairs at closing, etc. So you'll likely just get the mortgage off your back. Hope that helps. If you send me the address I can give you a rough guesstimate of retail and rent values assuming a nice finish and good shape.

I think the standard is pretty good, and just let it evolve as you do, adding or subtracting what seems relevant.  We emphasize care of the place, reporting any kind of leaks or water entry, and indicate arbitration in leui of litigation in case of disagreement.  Not sure if this will stick, but seems like a good start. 

I wish I knew more good carpenters!  Most are either too busy to even answer a call about more work, or are overpriced or undependable, or some combination of all three.  I have had good results with Jason Micheals, Blackhaw Builders.  Not sure how busy he is these days though.  Good luck!

I'm wrestling with the same decision myself, on a smaller scale (could sell for $170k or rent for $1200) Similar overall numbers, and by my rough estmate (rent X.7 to pay a manager and expenses including occasional vacancy) minus MTI, it'll have mild negative cashflow, offset by loan paydown. So with this one (as with yours) the impetus to keep it is the expectation of market gain, which is risky, but potentially highly profitable. All my other rentals cash flow, so this is the first I'll keep on such poor numbers, mostly because one of my carpenters wants to live there. 

May we both benefit from a continued rising market!

There is indeed a significant slowdown in AVL. We are down year-over year (in addition to the expected seasonal lull, which is enormous), from first to second year, despite 5 star reviews. We attribute it to a rapid increase in available rentals as more people jump into what was only last year a profitable market. There will also (in my guess) likely be some decline as the "heat" and newness of Asheville wears off a bit, and people start looking for more variety in their trips. The impending recession will enhance that slowdown as well. We expect a few marginally profitable years, then either recovery or continued decline, depending on how many new players enter the market. 

Agreed Robert- retail prices are the pressure point that's raising rents. From what I have heard it seems that the anti-short-term rental groups were actually started and funded by the hotel lobby to undercut the competition from local investors in the short-term market. 

@Robin Waters

Thanks! I'm far from an insider on local politics, but my impression is that the hotel industry has a heavy hand in city planning, which IMO stifles some of the intiatives that would potentially preserve our quality of life despite the rapid growth.  

Specifically, a bike lane and path plan was approved by the council but never implemented due to lack of momentum. Also, zoning for village-style in  town development seems rare and difficult, in favor of large hotel and apartment projects.

On a wider political scale, midsized road improvement projects are stalled for years or sometimes scrapped entirely. So traffic

 is rapidly worsening, with few real plans to address it long term. 

The market has peaked, in August, and is dropping. Already some good opportunity here and there even on the MLS with some frustrated sellers dropping prices. You're also welcome to give me a shout about a couple I'm selling off MLS.

The points above about the changing nature of AVL are spot on. I still love it- great music and food, good biking and climbing and world class kayaking. My big fear for Asheville s future is traffic. It's already bad and getting worse, and the DOT and city are not actively making things better.

Hope that helps!

@Robert Ombres- check with the County- last time I talked to them it was no more than 2 contiguous by a single owner, regardless of subdivision, unless you're permitted as a vacation rental complex. Maybe that has changed. 

There is a rule in BC disallowing over 2 vacation rentals on continuous land by the same owner. Otherwise you're legal as far as I know. Glamping and tiny houses may not be legal rentals in some cases though- I'd reccomend talking to the County first to see what your options are. Legit tiny houses would likely do very well if in a pretty spot, but you may be limited to two. Our rough guess for cost to build is unfortunately still around $50k due to so many fixed costs such as septic.