All Forum Posts by: Nathan M kiefer

Quote from @Erick Ayapana:

A few days ago I finally listed my first rental property on Airbnb as a MTR (due to Long Beach regulations regarding ADUs). Today someone made a reservation request for a month-long stay. She was initially fine with a lease agreement, but cancelled once she saw it. Said it was too intense. It's just a standard lease agreement from Avail.com (which appears to be the same form from AOA), with minimal tweaks from an attorney. 

That said, I kind of agree with her since it's a standard dlease (19 pages long!). Anyone here do lease agreements alongside Airbnb bookings? If so, do you use a standard lease? or is it pared down? 

Super frustrated. I was excited for my first booking!

 Been doing it for almost 15 years, our lease is tried and true and 9 pages long.

initial thoughts are maybe it's a blessing in disguise but hard to tell without seeing your 19 page lease. It could also be that it's overbearing.

if it's 19 pages it probably had way more teeth and hooks than it needed to. .

Quote from @J Lyftogt:

Quote from @Michael Baum:

Hi @Ivan Aldana, so you are a not really informed based on some of you statements.

First off, COVID drove people to vacation at STRs all over the place, but especially in more rural areas where they can get away from it all. Most of us saw record occupancy and nightly rates during the pandemic.

Urban STRs were hit harder due to the heavier restrictions in larger cities.

Regarding the rural vs urban, I believe in beaches, lakes and mountains for any STRs I look at. I almost never look at urban places.

In an urban/city you can expect STR restrictions, unreasonable regs (sometimes) and an overall dislike of STRs in general.

In a rural area, you can expect more acceptance due to the distances between homes, the taxes STRs bring in can make a real difference (plus the places people visit drive revenue) etc.

There are a ton of folks converting their STRs to LTRs due to outright bans in the bigger cities.

Buying your STR in the right area will be important. Plan ahead if you buy in a seasonal area. We are very seasonable and planned accordingly. No problems making a profit.

Lots of great advice in this thread. Do you or anyone have any recommendations on a market to look in for a short term rental that would cost under $150k?  This would be my first property and I'd like to pay cash and not stress about having an additional mortgage. Also, I think I would struggle to qualify for any loans because I am already self employed and we don't pay ourselves a huge salary. 

@J Lyftogt

in out area you're going to be in a condo that's a 1/1 or mobile type investment. Both I would not recommend.

decent entry level is 250k minimum to get anything that's close to being able to have a decent return and even that is pushing it- at least for our area- Myrtle beach/Surfside

Quote from @Ivan Aldana:

Quote from @Nathan M kiefer:

Quote from @Ivan Aldana:

Hey BP fam! I'm still doing market research and can't decide what would be a less riskier option for me, is it better to find a property in a vacation destination that's more rural and outdoors or a property in a more urban/metro area? I'm thinking that in more rural areas there's less exit strategies, like what happened when COVID hit, everybody stopped taking vacations. So since it's not really in a metro area you can't really convert it to an MTR or LTR if you had to. The only exit strategies I see is only STR, sell, or go through reserves until vacations would pick back up.While in a more metro area you can convert to MTR or LTR if need be. What do you guys think? Do you any of you guys have properties in both kind of markets? If so, which are performing better in your experience?

We have 18 ltrs in a metro area scattered throughout, have had since 2010. We have 2 str in ocean lakes resort and campground which is a Beachfront resort- because it's a campground it's str are pretty much invincible and protected against str rules.

did 140k last year out of those two houses.

my advice is metro for ltr, we have had almost 100% occupancy even through covid - we are not a slum lord. As far as str, get in an area like ours where you have sun, sand, no str restrictions and a water park doesnt hurt either( as we also have that) and you will be successful as long as you buy them right.

 Great advice Nathan! Just what I needed, the inside scoop of your personal experience, really appreciate that! 

 your welcome and best of luck on your journey!

Quote from @Theresa Holl:

Quote from @Michael Baum:

I want to point out something about what @Theresa Holl said.

All those things are very cool and would be nice to offer, but they would constitute significant services which will change your taxable status.

So you really have to balance those sorts of special experiences or offerings. Many things listed would be considered significant services and would have you losing much of your tax deductions.

I know of a couple of STR owners who had to eat a big tax bill due to this and they had to nix those sorts of offerings.

That doesn't mean you can't create the wellness space, golf simulator, upscale game room, etc to enhance the space. You just don't want to bring in people to train folks or do yoga or whatever.

That means even if you don't pay them but created a relationship. It isn't the same as us telling folks where to rent a boat.

I respect that position, but it depends on your priorities and financial goals.  My business group did this and booked solid for 18 months out in a crowded market.  So our business priority is to maximize top line revenue and bookings.  Retreats and events were central to our marketing strategy and we did very well.  

Agree, do what works. In str there is no right or wrong as the spectrum of items in this area is vast- location, type, size, etc etc etc.

Quote from @Ivan Aldana:

Hey BP fam! I'm still doing market research and can't decide what would be a less riskier option for me, is it better to find a property in a vacation destination that's more rural and outdoors or a property in a more urban/metro area? I'm thinking that in more rural areas there's less exit strategies, like what happened when COVID hit, everybody stopped taking vacations. So since it's not really in a metro area you can't really convert it to an MTR or LTR if you had to. The only exit strategies I see is only STR, sell, or go through reserves until vacations would pick back up.While in a more metro area you can convert to MTR or LTR if need be. What do you guys think? Do you any of you guys have properties in both kind of markets? If so, which are performing better in your experience?

We have 18 ltrs in a metro area scattered throughout, have had since 2010. We have 2 str in ocean lakes resort and campground which is a Beachfront resort- because it's a campground it's str are pretty much invincible and protected against str rules.

did 140k last year out of those two houses.

my advice is metro for ltr, we have had almost 100% occupancy even through covid - we are not a slum lord. As far as str, get in an area like ours where you have sun, sand, no str restrictions and a water park doesnt hurt either( as we also have that) and you will be successful as long as you buy them right.

We have 2 beach stilt houses next to each other and coordinate the listings and state that each has a occupancy of 13 but also state that we can accommodate up to 26 total. 

at the end of the listing we have a picture of the two houses side by side showing same. It has worked great for us doing it this way And we get group bookings for large families all the time this way.

sounds like trouble trying to do that in one actual listing for calendar coordination but maybe someone will have some great ideas.

Great post and thought provoking for sure. Every STR we have been a part of -ownership or management- the branding has been the least of the issues or concern. People that are good at branding and review designation can bury those low reviews and I wouldn't want to own someone's reviews but I am not your audience as far as a projected buyer as we purchased ours for a deal and they are both higher end beach stilt houses that are side by side and neither had been listed as a STR on any platform, we built it up with a direct book site and also use the platforms as well as the local website in the area to book.

This entire conversation in my opinion comes into play for a group or entity that may have 50-100 STR's where the branding will matter more but to be honest from what we have seen when they get that large they usually have lack luster service and subpar reviews- in the end someone that is 1031'ing mostly cares about that cash flow at that level and that's why and mostly only why they care about buying a brand.

1-15 units and a brand is nice but in my opinion wont break a deal- we are trying to do it but in the end its more for our guests to have a simple streamlined way to book with us. We keep good books, have legitimate and good tax returns and can show tangible real income on these units. In our experience that is what carries the day along with the area and the STR restrictions or lack thereof(a whole other conversation) that deems the valuations.

Airbnb and VRBO have thought of this and are way ahead of it, we scaled quickly using these platforms for two high end STR that book out great, once we established that, we created a direct book website and are slowly pulling our repeats from that. To me the value is in that, showing cash flow year over year and having the returns to show it. I would buy a house all day every day based on good returns and the proper STR "community" before I cared about the "brand" per say.

Quote from @Andrew Steffens:

I agree that you should consult an attorney for your state as each state is specific in what you can and cannot do.  While getting a template (likely from another state) may make you feel good, when the time comes for you to enforce the agreement and it does not hold weight will not be worth the savings.  Either consult an attorney to draft one for you or try to find one from someone in your state already is my advice!

 Just as there are no requirements to use a short term rental license agreement there are also no requirements to not use them.

If you are talking str where the STR is illegal then I agree.

Quote from @Christian Hutchinson:

Quote from @Jon Martin:

Quote from @Christian Hutchinson:

This would be like telling a hotel you can't have interior cameras in their hallways to to their individual rooms.

Horrible comparison. I don’t prance down a hotel hallway in my underwear, but I do expect to be able to do that in a kitchen of a house I rent. A kitchen or interior hallway inside a home is still a private space where I expect exclusive and private control over, whereas a hotel hallway is a shared space where privacy is not expected.

While I’m not a fan of a lot of their policies and priorities, I don’t think AirBnb is out of line with this one. 

 The KITCHEN is shared with other guests. You are not in a house by yourself.  There are other people renting rooms. Walk into a house.  Think like a ski lodge...its a 6000 sq ft home.  The living room with the TV (no camera).  The kitchen (camera).  The hallway that accesses private bedrooms, bathrooms (camera), stairway (camera), entry door - exterior (camera). Bathrooms, bedrooms are not being monitored.  Think of walking through a Hampton Inn. There are doors on each side of you...That Hallway has a camera.  The ice machine/vending machine lobby has a camera, the 2nd,3rd,4th floor elevator lobby has a camera.

 Don't want to pile on but in my opinion Airbnb was born out of an alternative for hotels so I don't think that would be a great argument for keeping cameras where you are stating. I am tracking but think the very thing you are referring to is why Airbnb came into existence- to not be like hotels. 

The longer Airbnb is around the more items will be identified like this to "carve out" so they dont align. 

Quote from @Christian Hutchinson:

So you wouldn't stay in a hotel with a camera in the hallway? stairway?, or elevator lobby?

This isn't renting a whole house/unit.

Imagine its 6 rooms in a building.  Having cameras in the hallways these rooms go to is a problem? or the shared kitchen.

Someone steals someone's food, or cooks a meal leaving the area dirty? how do we assign responsibility?

 This thread is more confirmation for me why I will never invest in this type of unit/building etc. no thanks, dont need it. I have better things to do than to have to worry about tenants stealing food etc, more power to ya but 100% not for me.

I also would never stay somewhere there is interior cameras, some things should just remain private, for no other reason than that. I do sympathize but nope, not for me.

we have a camera at each of our STR's, they are outside on the entry level so we know if our house is getting trespassed and/or if our elevator is getting abused, even that was a toss up for us but it is only that area and i barely can stand having it.