All Forum Posts by: Louie Gabriel

I would try to pilot one unit first to get both of your feet wet before diving in. This would minimize your investment & risk, while still allowing you both to experiment and understand what the new challenges are in running an STR. Then you can ramp up one by one as you feel build and become confident in your systems and team.

Metrics I would watch during your pilot are Average Daily Rate (ADR), Occupancy Percentage, Total Revenue per property per month. Most important will be your reviews/star rating left by guest, and will reflect the quality of your management team.

Has anyone dealt with tenant who is bipolar, off their meds? He’s been fired from his job. Family had him involuntarily committed. Local hospital immediately released him. He gave a handwritten, scribbled notice saying he was leaving by the end of the month. I confirmed the notice in a letter back to him.

He’s very manic, telling me people are breaking in the house, but not stealing anything.

I’ll file if he doesn’t vacate at the end of the month, but curious if someone who’s been through this has other ideas. I’m currently concerned about the tenant and the property.

I suspect you are looking at the cost of purchasing a manufactured homes/trailer in trailer parks.

The trailers are inexpensive because the value is in the land and the structure is a depreciating asset. The rent for the space typically goes up every year in San Diego (the space rents appreciate similarly to other rents). In addition, many trailer parks are hard to deal with for flips, non-owner occupied rentals, etc. This varies per park. @Justin R. did a flip of a trailer in San Diego probably close to 2 years ago and has some information about it posted on a BP thread. He indicated he did OK, which likely means he did pretty good.

There are successful RE investors that invest in trailer parks. There is at least one BP Podcast on this subject. I have not invested in trailer parks but have listened to the podcast. Basically the podcast placed emphasis on getting the pads occupied as moving the house is fairly rare. The podcast makes investing in trailer parks seem tempting. I think of trailer parks as either lower finances or retired people. I would definitely want a skilled, on-site PM if I were investing in trailer parks.

Good luck

You can write your own rental agreement, as long as nothing is contrary to your state law.

I'd suggest a month-to-month agreement, in case things don't work out. Your roomies might not be so great when you are the landlord.

Depending on your goals, Dallas Texas is a great cash flow market. won't get the big city appreciation, but you can find 16-20% cap rates. The last sfh we purchased we were able to add 30k worth of equity + make $500/month off of.

Hang in there and learn. Use a CPA for taxes, to help you learn-get up on the learning curve faster. It pays to own real estate. You need strategies and a plan. Look for seasoned investors to work with in your inner circle. Build relationships before you need them.

I think it depends on the size of the house and number of bedrooms you already have. It would also depend on windows. Would you have to put egress windows in or dig window wells? That can get expensive. We aren't finishing the basement of the house that we are flipping right now because it already has 3 bedrooms and 2 baths, along with a small room off of the living room. I don't think additional living space is needed. I also don't think we would recoup our costs because it would make it a more expensive home for the area that it's in.

Running ceiling fans reduces the need for AC (not by much but some), this can be a benefit in that

- saves your tenant AC costs

- extends the life of the AC - in theory at least

@Tyler Z. There are numerous factors to consider before anyone can give you a solid opinion:

1. If the property is in an area covered by zoning or similar restrictions, it is very unlikely you could use the unit as a 3rd residence. It's worth checking but most owners would have used it that way if it was permitted.

2. If the property is permitted to have 3 units, then you have to consider finished ceiling heights, window sizes (unsafe to have "basement" sized windows for an apartment), flooding potential, placement of the mechanicals, size and nature of the entry, whether or not there are 2 ways to exit and a number of other practical considerations and considerations dictated by the laws and codes of the area. You will create great liability for yourself (and, likely, the tenant as well) if you create a unit in violation of the law. If anyone gets hurt or dies kiss your life as you know it goodbye.

3. Whether or not it could be used solely for storage by someone other than a resident would likely also be determined by law and/or code and/or zoning although I suspect that to lease one storage unit (even if one wasn't technically permitted) that wasn't accessed often - if that were to pass muster with your insurer - would likely fly under the radar of most government entities (though it would still have some risk). If the storage tenant kept dangerous chemicals, explosives, etc. there you, of course, will have significant liability particularly if you do this in violation of law

Interest rates will remain low but may migrate upwards slightly. This will probably give sellers less leverage to charge higher prices than they currently have.

Demand will remain high and turnover will remain quicker than the norm. Frenzied buying will likely slow as more people are becoming aware of the importance of due diligence.

Housing prices will likely increase at a larger rate in low COL than high COL areas. This is both a reflection of shift in demand, buyer profile and prior market values.