All Forum Posts by: John D.

Thanks @Michael Baum. I am not looking to skirt the law, but rather educate myself on possible legal alternatives to operating a vacation rental property or properties in certain areas where regulation is changing. I do think that with regular change, there are often opportunities, but it can sometimes be hard to know how new regulations will be implemented, or how they will evolve. More established licensing options like traditional bed and breakfasts may not be as likely to have material changes to the regulation surrounding them considering they have been around for so long. 

Thanks @Eliott Elias and @Matthew Morrow, this is great info. I do like the idea of doing the upfront work to convert something if it will add value and create good cashflow, but yes - the biggest pitfall could be under estimating the rehab cost. Having a contractor that I can trust will be the most important thing here I think. 

Hi all!

I am researching the viability of STRs in upstate NY and there is a lot of chatter at the moment about pending or upcoming changes to regulations within specific towns, counties, etc. 

However, I am curious if anyone has any experience of applying for an alternate type of permit that would essentially allow a STR in the area. For example, a permit to run a "Bed & Breakfast" (in the traditional sense). Or, for example, if someone wanted to run a tiny house village of say 5 tiny houses on a few acres. Is there a special permit for say, a campground which could be applied for? This is especially interesting as a lot of the STR regulation I am seeing is either putting a limit on the number of nights that the property can be rented out for, or requiring that the property be the primary residence for the owner. Presumably an alternate permit type such as a campground permit or more traditional "bed and breakfast" permit would not have such limitations.

Thank you David. This is great info. I have spoken to a few others in the area who are reporting the same thing. The economic outlook for the LV looks relatively good, despite the global economic worries. And the housing shortage is keeping demand high and prices high in the area. Thanks for sharing your insight!

Has anyone got insight into current activity for rehab (BRRRR) or value-add deals in the Lehigh Valley, PA?

Has appetite for contractors slowed down, or has contractor availability become better or worse? 

Has there been less or more interest in doing rehab work lately?

I know it was very hard to get contractors last year, so trying to figure out if that environment has changed. 

Thanks!

Thanks Erik. That is definitely something that I have thought about. In fact I do not see a huge difference in valuations between SFRs and duplexes in my market, which indicates that converting to a duplex might not make sense. 

I think it will definitely help the DSCR ratio, but as you say, the valuation may not come back where I need it to be.

I dont have a property yet to convert, but I am trying to figure out if it makes sense to include this as a strategy when looking at properties that need work. I am looking for properties as part of a value-add strategy but I am trying to weigh up the effort vs return on doing something like a duplex conversion. 

Along the same lines, if there are property types that are well suited to a conversion and can be converted to a duplex more easily than other property types, that is also something I am trying to figure out. 

Does anyone have any experience with converting a SFR into a duplex in either NJ/PA?

I am trying to get a sense for what is involved in undertaking a project like this in either of these markets, and whether or not it still makes sense in today's economic environment. 

I am curious if anyone has list of common mistakes that people make when trying to convert a SFR to a duplex?

Are there specific types of properties that work best for a conversion to a duplex? Are there properties that do not work well for a conversion?

As part of the BRRRR strategy, it feels like converting a SFR to a duplex (assuming the local market likes duplexes and apartments) could be a good strategy to combat the higher interest rates that we are going to face when going into the refinance.

Obviously the assumption here being that we can still get the conversion rehab done for a cost that does not get us too far about 70% ARV.

I have not done a conversion to a duplex, so I do not know how expensive it can get, but does anyone have any experience with this and if they think it is a stronger move within the BRRRR strategy, given the push that interest rates are going through now? It feels like after the conversion, the DSCR should be better also with the rent coming from two units?