All Forum Posts by: Murray Reginald

Hi BP,

Can someone please tell me the best tools to use to analyze a distressed property? I would like to look at properties and be confident, knowledgeable and able to give an immediate offer for a property. 

Also, is HAR.COM the only website to run comps on surrounding properties because I am not a realtor but was checking to see if there is a work around?

Hi BP,

I've recently connected with some Wholesalers to purchase under market properties (70%-75% ) that I could BRRRR however, I was wondering what type of precautions if any should I take when doing transaction with wholesalers, should I sign a contract and should I pay a down payment? The contract states the down payment is NOT contingent on anything beyond the conveyance of clear and marketable title to the property. I am not trying to bash anyone or think that wholesalers are crooks, I just know that there is always some type of scam in anything where there is $$$$$$, and to invest large amounts of money is nerve recking!!!

Hi BP,

Can someone please tell me how I can connect with an wholesaler, I am looking to purchase an investment property and thought it would be a good idea to connect with an wholesaler in Houston Tx. 

Hi BP,

I am needing some advice on what is the lowest CoC Return & Cash Flow I should take, I am thinking if I invest in a LTR that has a CoC less than 10% and Cash Flow around $50-$100 with the expectation of interest rates going down it will increase both CoC & Cash Flow and I should be in good shape. Is this a good strategy? Should I just keep looking until I find that deal that checks all of the boxes? Its hard to find a good deal what are you guys currently doing?

Thanks to everyone for your responses. 

I have another question, what should I do? I've done some more research on AirDNA and Mashvisor however, I am coming up with two different analysis, this is what I am seeing from both:

AirDNA:

Annual Revenue - 121.6K

ADR - $378

Occupancy Rate - 88% 

Mashvisor:

Annual Revenue - 24,552

ADR - $68

Occupancy Rate - 98%

Im also using BNB CALC as a PM tool to run my numbers, I change the data from AirDNA 88% to 60% Occupancy to be more conservative, here are my numbers:

Property Value - $299,000

ADR - $275

Annual Revenue - $60,225

Operating Expenses - (-$21,554)

Operating Income - $38,750

Mortgage & Taxes - (-$29,040)

Cash Flow - $9,710

I've compared other STRs however, there are not too many STRs close by, so why am I getting a huge difference from AirDNA & Mashvisor? I am wanting to pull the trigger, but I can’t seem to come up with numbers close enough to make a sound decision, I did speak with a PM in the area who gave me the following:

ADR $235

Occupancy – PM said that AirDNA was pretty accurate on the Occupancy Rate at 88%.

This is not good, what is the lowest Cap that I should accept? Or is it just not a good time to purchase STRs?

Hi BP,

I am looking at a couple beach house properties that looks really good on AirDNA however, AirDNA gave me the following analysis:

Beach House Property:

Annual Revenue - 121.6K

Occupancy Rate   - 88%

Cap Rate - 29.51%

I have another house I see that has the following analysis:

Two Story House Near Beach:

Annual Revenue - 121.6K

Occupancy Rate - 88%

Cap Rate - 29.51%

I've ran some comps on the beach house however, I don't see any 3:1s to compare I only see 4:2s and 2:1s, I'm trying to figure how accurate are these numbers and is there anything else I can do to confirm this will be a good investment since the Beach House has never been on AirBnB/VRBO im wondering how accurate is this information and how did AirDNA come up with those numbers.  

Hi BP,

I am also trying to understand metrics using AirDNA. I am currently analyzing properties and need some advice on the following:

1) Annual Revenue (AR) - I am seeing several properties with an AR being around 40K-50K is this a good AR or should look for something higher?

2) Occupancy Rate (OR) - I am seeing several properties with an OR being 50-60% OR is this a good OR or should I look for something with a higher OR?

3) CAP Rate - What is the minimum a Cap Rate should be no less than 15-20%?

4) CoC - What is the minimum a CoC should be? No less than 20%?

Quote from @Karl McGarvey:

Hey Murray,

Lovd the House Hack method! I actually have a client fixing up a house hack that will become an STR in Galveston right now.

I will caution you that renting out just rooms for STR and not whole home on the island is going to limit your visibility and client base. VRBO only accepts whole home listings which is where got the majority of our bookings last year (not the case for everyone). Most families vacationing on the island also want private residence, especially when kids are involved. Even though you'll be moving out after a year, the reason this matters is your first year of reviews will be based on your shared model.

For your AirDna questions, I much prefer PriceLabs. Way more bang for your buck at only $10/ mo for market and property info.

If there is anything else I can do to help with your search let me know! I work with a lot of investors on the island and have personal LTR/STR investment in Galveston!

Hi Karl, Thanks for the information I am very excited about the house hack, I do have a few questions for you:

1) Where is the best place to purchase STR furniture?
2) Did you hire an interior designer to setup your STR?
3) Do you think I should manage the property myself? 
4) Do you use a PM if so what is the cost?
5) I see the Hotel Occupancy Tax (HOT) is 9 % is this fee paid by the guest fees? 





  

Hello BP,

My STR strategy:

I just started renting my existing residence and in the process of purchasing a primary property in Galveston Tx (Beach House), I plan to AIRBnB 1 to 2 rooms depending if the property is 2-3 Beds. After my first year I plan to repeat the same process, this property will now be a full time VRBO/STR. I plan on doing this every year for the next 10 yrs. in hopes of having built a wealth of investments with RE. This is will now be my second investment property, and I am looking for some strategies/advice now that I am diving into STR's, I just purchased a book on "How To Start A Successful AIRBNB Business" by Walter Grant & Richard Anderson and listening to a lot podcast as well any other tips?

Questions:

1) Where is the best place to get the most accurate data for STR's? AIRDNA? Should I purchase the AIRDNA City Plan which is $59?

2) What expenses should I calculate for analyzing a STR property? And how much?

Electricity  

Water 

Gas 

Garbage 

Cable 

Security 

PM 

Furniture

3) What is a good Cash Flow, ROI for STRs?

4)   Can AIRDNA or any other system provide the following below information:

• - Data that is tracked for over 250 days in a calendar year
• - Reviews every month to ensure they've been hosting for at least an entire year
• 1. Annual revenue
• 2. Days available
• 3. Avg daily rate
• 4. # of guests the property holds
• 5. # of bedrooms and bathrooms
• 6. # of beds
• 7. Is the property self-managed or run by a PM
• 8. List of amenities