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All Forum Posts by: Ken Boone

Ken Boone has started 9 posts and replied 979 times.

Post: Too Steep for Airbnb?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

@Kyler J Sloan Ok man. This is getting to be like the jeep thread now when all the details start coming out. Again, I still don't know if you already bought this property or are in the process. It would make a nice private cabin for someone. If you are trying to have a great cash flowing STR - not being mean here - just trying to give you advice - your plan stinks dude. Just trying to be blunt with you.

One of your big deals is privacy - Now we find out you will be there most weekends.  Well there goes the privacy factor cause you will need to disclose this info.  No way I am taking my wife and girls to a secluded cabin on a mountain top with not very good access and have someone else that I know nothing about there.  On the weekends no less which should be 100% booked through the year on a normal basis.  This type of airbnb scenario is not this market.  That strategy is one for the cities dude not the smokies.

Again not if there is an issue - when there is an issue would be the correct term - there will be issues.

Your intuition is flat wrong. This property with that road and you living there on the weekend makes this a BAD STR choice for the Smokies. Just about all the great views in that area will have steep roads and switchbacks. But there are plenty that are PAVED with guard rails and maintained - not one lane gravel that you have to maintain.

So again, if the main use is for your personal use and you just want to try and make a few extra bucks great.  But it is hard to tell what you are trying to accomplish.  Your heading says new to real estate and you started this post with not familiar with the roads in the TN mtns, yet you don't sound like you want to take seriously what anyone says.  I have helped a number of people with property up there and the thing is to mentor someone, someone has to be able to hear what others are saying.

It sounds like you want the property and jeep for yourself and you are trying to figure out a way to have someone else pay for those things and if that is the case - thats great more power to you.  You don't really sound like someone who is looking for investment advice.  I really do wish you the best with this property.  Just trying to provide you with good advice if you have not purchased the property yet.

Post: Vacation Rental - Is 10% cash on cash too low for first STR?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

@Peter Amendola So your question about what drives up daily rates - first of all you have to compare apples to apples here. So yes more beds brings the rates up.. i.e. typically a 3 bedroom STR will have a higher rate than a 2 bedroom STR. Now comparing say 2 bed STRs in your area - amenities is the main driver. In my location I have primary 2 bedroom cabins and I have them loaded with amenities. I perform as well or better than most 4 bedroom cabins in my area because of the amenities. You are in the keys man! So aside from the options I have thrown out as far as what to have in the property, you can also look at other things, providing fishing poles and tackle, providing snorkling gear, providing paddle boards, etc.. Now if you do the paddle board thing, may want to check with your insurance company just to be safe with that.

Post: Partnership on Short Term Rental

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

Yea this suddenly moved from real estate talk to personal matters... oooh.. Yea just personal opinion and you know what this is worth. I would not enter into an equity deal like others have said. Until there is a solid commitment you just never know and then you would be locked up into a bad scenario. Hopefully that is not what happens but ya never know. At this point I would not even do a profit split. Instead of a guaranteed profit split I would basically set up some type of contract to hire him for his services concerning the STR and that could be tied to a split of the profit, but it would be clear that it is a hiring situation, not an ownership or partnership situation. That way if things did go south, you can simply fire him and move on. Plan for the worst, hope for the best. Hope this doesn't upset you in any way but this really moved into areas of the heart and beyond pure real estate dealings.

Post: Partnership on Short Term Rental

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

So.. my question is, if you are putting up all the money on a single STR... why do you want to split it? It is not that much work to manage a single STR. If you are going to give up that much cash, might as well pay it to a mgmt company and that way you don't risk hurting personal relationships when there are problems.

Post: Vacation Rental - Is 10% cash on cash too low for first STR?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

@Peter Amendola That number really depends on what you are happy with. You or your wife will be working for that 10% so is the benefit of having the STR, plus the 10% you will receive worth the work you put in. That is really up to you. Now having said that I have STRs in the Smoky Mtns. I have found that most places that are beach STRs are not set the same as the smokies. Load the place up with amenities - multiple video games, ping pong, pool table, xbox, projector with big screen etc.. then you can raise your rates and bump up your return compared to your competition possibly.

Post: Too Steep for Airbnb?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

Yea and the reality is that the video does not show the actual steepness.  Videos never do.  So I guarantee it is steeper than it looks in the video.  I have taken videos trying to show the same thing at one of my cabins and they just don't do the steepness justice.

Post: COVID CONCERNS FOR STRs?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

@Luke J Nelsen So the country is really divided on this just like many things right now. What they think they know or at least what they tell us they know seems to change every other week. Part of the country is however fed up with lockdowns and mandates and that part of the country is still going to travel to destination locations like the Smoky Mtns. I don't think we will see a lockdown like we saw before. However, when it happened last march/april - in the span of about 3 weeks I lost over 37k worth of bookings most of them for april/may. Lowered prices immediately - pretty much re-filled through the end of april, the demand was so great come May brought prices back to normal and since then I have had to constantly raise prices due to the high demand. Ended up with a record year across all my cabins. Even that part of the country that is nervous about being around others still wants to get away. They would rather stay at an STR with a bunch of amenities locked up with their families than a lot of other vacations they could take. So I am not concerned but I could be dead wrong too! ;)

Post: Too Steep for Airbnb?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181
Originally posted by @Jay Hinrichs:
Originally posted by @Ken Boone:

@Kyler J Sloan I would personally rather invest my money into proven systems that cash flow well instead of spending my time trying to solve problems that have been around for decades.  It is a beautiful location and I am sure it will rent well for you.  My focus is on less work, less headaches, less time involvement and I know what you face with that property so just throwing my 2 cents out and that is about all its worth.  I wish you the best of luck with it.

Just dont rent it for a few months out of the year ??   

That is an option. Again, it gets back to @Kyler J Sloan's intentions. Great cash flowing STR as primary reason or personal use with STR and not concerned with maximizing cash flow. I would say the worst month in that region (if there really is one) would be February. I had one cabin at 100% occupancy in February and the others were not far behind. So in that area you still make bank in Jan and Feb so closing down would def hit your cash flow. But again if he is happy with that setup more power to him.

Post: Too Steep for Airbnb?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181

@Kyler J Sloan I would personally rather invest my money into proven systems that cash flow well instead of spending my time trying to solve problems that have been around for decades.  It is a beautiful location and I am sure it will rent well for you.  My focus is on less work, less headaches, less time involvement and I know what you face with that property so just throwing my 2 cents out and that is about all its worth.  I wish you the best of luck with it.

Post: Too Steep for Airbnb?

Ken BoonePosted
  • Investor
  • Greenville, SC
  • Posts 991
  • Votes 1,181
Originally posted by @John Underwood:
Originally posted by @Ken Boone:

@Kyler J Sloan said as long as you disclose it will rent. Not sure why you are posting the question. I am assuming since you said you are not familiar with the TN mtns, it is because you are thinking of purchasing this place for an STR. The place looks great once you are up there but here are a few things to consider.

In your question, you said driveway - not road - so I am assuming that whole thing is a private driveway to get to that cabin. I don't think I saw any other cabins on that route you took up in your video but maybe I am wrong. So based on that assumption let me tell you what you are "potentially" in for. BTW.. just about all cabins that have a great mountain top view in the Smokys will have steep roads with switchbacks. I have a cabin with an incredible mountain top view in the area and yes it has switchbacks and is steep for about 4/10ths of a mile. But the HOA maintains the road at the top and it is paved and plenty wide. The county maintains the road below. So with the "driveway" you have, I am betting you are going to deal with summer rain washouts, you will have occasional trees down across the drive. In the winter, you will have guests that either can't make it up the road, or they will not be able to get down at checkout. You will most likely have power outages during an ice storm - in the winter if all you have is electric heat this means no heat for your guests and no way to get down.

I don't mean this to sound rude, but there are a number of folks who book my cabin in Jan-Feb and never bother to check the weather and if they do check the weather and see a major storm system coming in they don't think about storing up food to get them through a few days. This past year was a 20 year bad winter. We had several heavy snows with iced up road conditions and power outages that loomed for days. Fortunately I didn't lose power, but I know of many who did. However, the norm is to get snow on the ground a few times a year and it might ice up, however the ice is usually melted by mid day the next day and everything is good. The problem you have is those conditions on that driveway are going to be a pain. Winter ice storms will surely bring trees down. When the storm hits, its gonna be hard to get someone that #1 can access it and #2 to get it cleaned up timely. Just some things to consider. If this is truly a driveway to the cabin I would not consider the purchase of this cabin. Too many potential issues there with that long of a driveway. This would be a different story if this was a county maintained road, or an HOA maintained paved road etc with other cabins but it doesn't appear to be that way. Last year we saw many many guests complaining about the cabin owners once they were stranded in cabins with no heat and no food. On several facebook forums they openly blamed the cabin owners and felt the cabin owners needed to do something to fix their problem Look, weather happens, but not all guests are reasonable or know how to handle those conditions. For those reasons I would be out.

Ken
You sound like your a shark on shark tank!

 Too funny!! had to reread my post to see what you were talking about ;)  Probably watched that show too much.