.--- You can also go down ONE level, but only in high demand areas.

At all cost, avoid heavy construction plays in lower cost markets.

Great points, Jeff — and you’re right to highlight that the expense ratios are unusually efficient for a coastal STR.A couple of clarifications on the numbers:The current owner self-manages, which keeps cleaning and maintenance costs lower than a third-party STR manager would typically charge.Some of the repairs and CapEx were front-loaded in prior years (new flooring, appliances, and paint), so last year’s P&L reflects more of a stabilized-operations scenario.The utilities figure is accurate — it’s higher due to being master-metered for the property — but the other OPEX categories are slightly understated if you were to underwrite this as a fully managed, third-party operation.If I modeled it using a professional management assumption plus normalized reserves, the operating ratio trends closer to 48–50%, which aligns with what you mentioned for coastal STR multifamily.I appreciate you calling that out — it’s a great reminder of how much variance there can be between owner-operated and institutional-style expense reporting, especially in hybrid STR assets like this.Here's the owner's profit and loss statement for the exacts of the 2024 year.

I believe it tends to give me a slightly lower return, because the sponsor is going to be more careful, and if there is a severe downturn will prevent me from taking catastrophic losses.

I have zoning approved 21unit project consisting of 12-unit conversion in existing school buildings and 9 new construction addition where I am contemplating a pivot 8 renovated units and a ground level and yard restaurant/beer garden concept if I can secure a liquor license.

if you had put a much lower amount down, and were break even or slightly negative, that might be OK - you're building equity without much capital tied up. 

Financial freedom has levels. 

Hi,  Any advice  I live in Texas, my portfolio is increasing in value and so are my property taxes This is despite contesting them yearly. at the same time recent new construction of Class A multifamily properties  ha...

And townhomes in Raleigh are a real great way to get in lower price point, easy to rent, and they are often newer and get you into hotter markets for apprec.Happy to share some local insights and connect you with a few folks, feel free to PM!

It's often missed in underwriting lower priced rental units.