All Forum Posts by: Kimberly Jones

Are you up to speed on our new str regulations? Unless the property is in a commercial area you will have to owner occupy in order to get the license. Technically you are supposed to be "on site" any time you have guests but you can probably mack it off by having a friend stay there. The challenge may come in with financing. You are going to have to have owner occ financing because you have to have the homestead exemption for licensing. Owner occ financing is not my area of expertise but I am thinking it may be difficult to use str income to qualify. If your income is high enough to qualify without using the rental income it would be a non-issue. 

Putting the NOLA property into a legal entity is going to depend on any mortgage that you may currently have on the property. Most of the time you are required to hold the property in the name of the borrower, whether that borrower be a person or an entity. We have a thread on this topic that is many pages long, pertaining to whether you could be in violation of the due on sale clause. 

https://www.biggerpockets.com/forums/311/topics/183825-due-on-sale-clause-was-called-by-bank

One of the things I have been pondering heavily lately.....where are our values headed at this point? Figuring out the answer takes a little bit more intuition in New Orleans than it does anywhere else. 

@Leona N. here is a map that may make you smile. It appears to explain why so many Canadians feel so much at home down here ;)

http://www.businessinsider.com/the-11-nations-of-t...

Well @Leona N. it is certainly warm here! There are a few days a year that we need to turn on the heat but usually not many. I know more than a few people that are from Canada and they are all happy to be here :) Have you been to the city before?

Is the property in New Orleans? I assume you are closing with cash? The most important part that I would worry about is the fact that the title company will not insure title under these circumstances. If the property is in New Orleans you really want to insure title. Too many things can pop out of the woodwork on title here.

I can't imagine how you would do it with timeshares. I suppose if the situation is right it could be done though. Condos can be very difficult because the association rules usually won't allow it. The first thing you need to do is check on city regulations. Many cities are starting to crack down on str's. Here in New Orleans it has been a major fight. Airbnb is the devil here, we are destroying neighborhoods, ripping the very fabric of the city to shreds, etc., etc. The haters have managed to kick up so much of a fuss that the city has implemented new rules. All airbnb properties have to be licensed now, if you do whole home rentals you must have a homestead exemption. Investors can only rent out str's 90 days out of the year. @Myka Artis are you aware of the new rules?

I am not up on Vegas and airbnb, but if they allow it you can do very well. Initial costs are usually just to furnish. All you have to do is take pictures and put up a listing on airbnb. The early days can be a little slow because airbnb runs on reviews. Once you have at least a few good reviews business picks up. The biggest challenge is usually housekeeping. Getting paid is a breeze. Airbnb collects the payments and does direct deposit to you within 24 hours of check in.

Yes, Braden can definitely help you out.

@Chad C. Both accessory and principal require homestead exemption. The City has done a fine job of killing a huge number of str's with that one requirement. Here is my view on it all....

I cannot imagine how they are planning to enforce. There are 4k+ properties on airbnb in Orleans Parish. I saw something last week talking about the new enforcement department and I think it said there were 3 people who are to cover inspections. I am going to take a wild guess and say that out of 4k, less than half will have a homestead exemption, probably more like 1/3rd. Even if it is 1/4, how the hell are they going to process 1k applications AND inspect them all within 2 weeks??? That is NOT going to happen. At the same time they are processing the applications for the ones that do have homestead, how are they going to manage to target and enforce the ones that don't??

There is one thing I don't think anyone on this train thought about and it's a doozy....what is it going to do to the market when investors can't run their properties as str's? Some are going to go to ltr and that is going to saturate the rental market. Rents will have to be reduced to compete. Many will say to hell with it and start dumping, which will saturate the sales market, which will also bring prices (and values) down. How many properties are currently listed in Orleans? I believe it is somewhere around 1500. If just 1/4 of the current airbnb's are thrown on the market it could be catastrophic. People are going to go into foreclosure, perfectly good properties are going to sit vacant, taxes will stop getting paid. Their little fees for str licensing are going to be a drop in the bucket of the money they are going to lose. On top of all that, folks who would have brought tourist dollars here are going to go elsewhere. It is going to be a straight up cluster fu**.

@Chad C. bed and breakfast wouldn't work with a 2 bedroom shotgun. As far as the CBD, it isn't about the area, it is about the zoning of the property. If the property is zoned commercial you can run wild and free with it. My property is in a mixed use area and is on one of the busiest streets in New Orleans, but it is zoned residential. I did consider trying to get it rezoned as commercial but that could take a while in this city.