All Forum Posts by: Dan Maciejewski

No, it is not legal to run a short term rental / vacation rental in Saint Petersburg.  You can have 3 turnovers of less than 30 days in a rolling 3 month period and as many turns as you want over 30 days.

I just met an agent that was advising his clients in St Pete that writing a 7 month lease for each guest would "get around" the rules.  He is possibly setting all of his clients up for trouble when the city cracks down.  And with their housing problems, they may just decide to free up some housing by getting the rule-breakers out.  The law is turnovers, not lease length -- it doesn't matter why the lease was broken; if you lose a tenant, you cannot replace them for any reason.

How are you trying to get into managing?  Buying for yourself, or actually being a property manager for others?    If you want experience, try getting on with one of the big companies -- Vacasa or Teeming (just bought by Vacasa), or one of the smaller shops.  They always need housekeeping and inspectors / housekeeping managers.

https://www.reddit.com/r/sideh... will have some ideas for you.

The best thing you can do is find a (low skill, labor/time based) service that people don't want to or can't do themselves.  Examples may be shopping, babysitting, cleaning. . .  Then (the hard part), get out and offer (sales!) the services to people until you have a book of business and know best practices for the service.

If you want to level up (and learn how to start a business) your next step is to find people (labor) that you can hire to do the work for less than you are getting paid.  You are doing the hard work by finding the customers, they will just be doing labor.  You are a manager now and direct the labor to where it is most useful and where it can earn money for itself.  Your job, once you have someone to cover your book of business, is now to go find more customers/clients.  Then repeat the hiring cycle.

Personally, I don't think having to register a business and pay taxes is too out of the ordinary.  

Florida has a 6% bed tax on transient rentals, so that's not crazy -- Georgia add a 1% road tax to transient rentals.

Some additional things you may see for short term rentals / vacation rentals in other jurisdictions may be:

requiring someone to be on call/available 24/7,

Maximum occupancy per bedroom,

Minimum parking space requirements

A Certificate of Occupancy prior to renting, or one per ___ period,

Maximum turns per ____, Minimum night stays,

Fire extinguishers, Etc. . . 

So, I don't see those as too onerous -- I've seen way worse, too!

Quote from @Joe Villeneuve:

What made a good deal in 2021?...and in 2020, and in 2019, and in...?  The answer is the same for all of them.

☝️  A good deal is always a good deal no matter the market.  Cash Flow is usually important.  If you are wholesaling, you need to know what your ideal client wants. 

Are you selling to flippers?  Then you need to know what their desired profit is, whether a percent or a flat dollar amount.  If they can't tell you, they aren't flippers, they're thinking about flipping and they're probably not buyers.  A deal for them is something that fits into their buy box.

If you're selling to buy-and-hold, they will have a Cash on Cash goal, or a Cap Rate goal, or some metric that makes them have a buy box.   You'll need to fit into that.

Wholesaling (not discussing opinions on it) can be harder for new people without a huge pipeline.  You need to discover how to find sellers, then sellers that fit into your ideal client's goals, then find sellers that also fit into your profit goals.  

A deal is always a deal.  The market doesn't change that, it may make it easier or harder to find a deal, but the criteria never really changes.  And always remember that there were a LOT of people 2 years ago that "couldn't find a good deal."  Many people can't recognize a good deal if it knocks on the door and slaps them in the face.  Possibly Thomas Edison:  "Opportunity is missed by most people because it is dressed in overalls and looks like work."


Also, keep analyzing numbers -- run numbers on everything!  It's like gathering firewood -- Do it until you think you have enough -- then do twice as much.  The more you look at, the faster you recognize a good deal when you see it.  

Quote from @Sanderson Mittnacht:

Quote from @Shawn Mcenteer:

When property is listed talking to the listing agent becomes a requirement by default in most cases, the seller is paying for the service of the listing agent so the majority of the time even if you have an opportunity to speak with the seller a well trained  listing agent will direct seller for all conversation to go through them.   At the end of the day most sellers and even listing agents give out a lot information.  Having conversation with both is seller and listing agent is great but most of the time the seller remains "hidden"   

@Sanderson Mittnacht is there a particular scenario you need help with?

 Not a particular situation ATM just curious cause I always here people talk about "We spoke to the seller and learned about their goals with selling the property" ...I hear it often around creative financing. It sounds like most of those conversations are had through the agent.

The people that say that talked to the seller the same way that listing agents do -- before it hits the market.  You have to either:

Build a relationship so that when they decide to sell, they think of you. Or

Have great timing so that your marketing or calls hit them at exactly the time they decide to sell.

Or, preferably, a mix of those strategies.  

Just remember that we are in a time when all of us are deluged with ads almost every waking moment, so the cost per impression is getting more expensive and the required impressions are ramping up exponentially.  

Quote from @Terri-Leigh H.:

Quote from @Stetson Miller:

Hi @Terri-Leigh H.,

Others have already mentioned holdbacks for repairs and capex, but I would like to reiterate that those are necessary to add into your calculations. Also keep in mind that with insurance issues in Florida right now, if the property has an asphalt shingle roof, lifespan is only being allowed to reach 15 years and you will be required in most cases to replace after that

Otherwise, your tax debt is low, this should be estimated at about $5,000 annually based on a sale price of $400,000. See following link for future estimates:

https://www.leepa.org/taxestim...

One other question I had reading through your spreadsheet, what months did you account for being the busy season and off-season? My recommendation for slightly conservative occupancy numbers would typically be Oct-Mar at 90% occupancy, Apr-Sept at 50%. Your nightly rates do look to be accurate though. One way to potentially increase income could be adding a 4th bedroom if it's possible somewhere within the property and the square footage allows it

Thanks Stetson!

I will add the omissions you suggested! Those are the exact dates I had in my assumptions for occupancy , I will rework to your estimations. Nothing I have looked at has potential for an addition BUT we are certainly planning on "sleeping porch" offerings of a bunk, or day bed etc.

Interesting about tax, I am going off actual numbers as of 2021, and all have had their assessments for city water and sewage. Would it really jump that high? As for roofs, that is in our consideration when looking!

What do you think of cash flowing so low monthly but getting the HELOC money out and working for us?

 Yes -- the taxes will almost definitely shoot up.  They are based on the purchase price and we allow owner-occupants to "homestead" their homes which gives you a discount and caps the amount the taxes can go up at 3% per year.  AND, you bring the cap with you to your next house, and so on.  I have literally seen taxes go from $700 last year to $11,000 after purchase.

See if the county you are looking in has a tax estimator tool on their property appraiser website.  Our property appraiser in Pinellas is great and we have the best estimator tool I've seen!  PCPAO.org if you want to look.

I just found a 3/2 with a pool in Clearwater for under 600k that will gross over 100k a year

I hope that's not on Summerlin! That's in incorporated Clearwater and the city will not allow vacation rentals for less than 30 days!  

Lol -- I just saw this post from a few years ago!  Since then almost all of my investor business has been short term rentals / vacation rentals in Pinellas.  I've sold dozens of vacation rentals in the past few years and they are all doing very well.  Some clients are buying / have bought their second investments already!

The purchase prices have skyrocketed at 20%+ year over year for the past 2 years but the ADR is keeping pace. We are still seeing 9%+ cap rates in the desirable areas in the desirable homes. We are seeing good ROI from the below average prices all the way to true luxury homes. Obviously good management is key to getting the best returns but you are comfortably 80%+ occupancy all day ling. Tampa Bay was the only hotel market in the country to maintain above 50% occupancy when everything was shut down, and the STRs were booming then!

@Lianne Ottaviano, it doesn't look like you ended up buying, or possibly sold since then.  I'd love to hear the story!

Like everyone is saying -- it will depend.  

It depends on the level you need.  If it's a luxury rental, it will NEED luxury finishes.  If it's a beach rental, it should be beach-chic-ish, which can be expensive or not.  If it's somewhere that will have a lot of very short stays, you can go the modern hotel route.

It's also very dependent on if you want to spend time for money.  You can hire a decorator at 100-200/hour and pay markups on all the décor, or you can spend hours on FB marketplace and thrift stores hand-picking every item and saving thousands.

Quote from @Monica Pacheco:

Hello, newer member to BiggerPockets!

A realtor contact that I have recently made suggested St. Petersburg and the surrounding areas, any ideas?

thank you in advance!

You definitely don't want St Pete itself -- they only allow 3 leases under 30 days in a rolling year. There are unincorporated areas in South Pinellas that do allow it. Some of those are in locations that will maximize ROI.

Some people refer to the entire County of Pinellas as St Pete.  In that case, there are plenty of great returns for vacation rentals in Pinellas, even at the inflated purchase prices we are seeing.  You can get a turnkey (or almost turnkey) place for a 9+% cap rate fairly regularly.  You probably aren't getting a 16+% cap rate like another Member suggested recently, though!  

I don't think that our 20+% appreciation will continue, though.  And I question FreddieMac's prediction this week that we will see a 10+% appreciation for 2022.  I do think we will continue to see some appreciation this year -- we see a lot (50%+ in some market segments) of cash buyers, and they aren't going away or getting weaker as interest rates rise.  Our particular metro will continue to draw jobs and grow for the next few years, at least.

The city decides the fines or punishment for breaking their ordinances.  A person above answered for Denver, although I can't vouch for the info -- it looks like $1,000 fine for violation.  The answer comes from the city you're wondering about.  You can look in the Municode but I don't think that has the punishment schedule.  You can call Code Enforcement -- they should know what they do when they issue the violation.  Each city will handle things differently.

Here's an interesting Google search that will give you plenty to read for Denver. short term rental enforcement

Scottsdale, AZ just formed a new enforcement squad just for vacation rentals!