In regards to short term rentals keep this in mind: 1. At the end of the day, most people just need a decent place to lay their head at an affordable price. 2. It doesnt matter if you get booked a month ahead or same day. What matters is it gets booked. Look at most the motels that have been doing this for decades. Youve seen how basic they look at best. No bells and whistles. Just the necessities. Of course it looks great and increases how fast you get booked when you add pizazz, but dont think you gotta outdo Joe down the street. He can only do one reservation per listing per day.
I bought a vacation rental on the central coast California 15 years ago. 100 steps to the beach. Because of all the costs I have never turned a profit. Mortgage, insurance, HOA, maintenance, cable tv, internet, phone, water, gas, replacement furniture, management, cleanings, we thought we would finally turn a profit this last year because we paid it off but we had a major repair. I would not recommend a vacation rental unless you’re buying it for yourself to enjoy.
Something doesn't seem right there in that senario. Vacation rentals can be very lucrative. Usually more than long term. And I bet you atleast had good appreciation
One piece of advice on AZ. Don’t buy right now in small cities/towns. There is a law that has a decent chance of passing, stating towns under 17k population are allowed to make their own laws regarding STR. That would make the Governor’s law protecting STR’s invalid in those cities.
Already seeing people in Lake Havasu wanting to ban STR. Residents showing up at monthly city hall meeting with Mayors. New areas on the Island there implemented HOA in some areas that now prevent STR. And many condos HOA preventing there too.
Awesome episode guys. Also, I love to listen to Robuilt give his short-term rental advice. We recently bought a luxury short-term rental in Costa Rica in order to enjoy the country and use the short-term rental to cover the costs and create a 5-10% return to the investors.
David's macro comment about communities in FL being welcoming to STR is not really accurate. There are many small coastal towns that are dead set against it. Even Orlando proper bans STR. You have to go south and east to find areas where it's allowed. Don't relay on VRBO searching to see if there are STR in an area. A lot of them are actually breaking local zoning laws and could get caught and fined.
Great advice from David that an important part of your return as a new investor is knowledge. Don’t be disappointed if your first investment isn’t a home run. A solid base hit is more valuable than nothing, or losing out. Also great advice: especially for new investors, time is probably a big part of your investment. It’s not just money, and the relative importance of time vs money can change.
Great information about vacation rentals. We purchased a cabin in North GA two years ago and started the business in the middle of the Covid-19. We had a great run so far and learned tons! We are experiencing a little bit of a slowdown however the property itself increased the value almost double! So it still a great investment. Thank you for sharing your knowledge guys!!!
Idea: I have a few rentals (6) and would like to buy a short-term rental. Open to all areas of the country. You pros help me through that process in an efficient way, we record and share all the steps/info on a later show. 🤷♂️ Let’s show your listeners “how” to do it…give them what they are looking for 👊
Regarding the caller who asked about converting his 3 year-round units to short term: thank you for mentioning diversification. Let’s also remember that folks need year-round housing. I think we have a responsibility to provide both.
If you're str investor just know that we are coming for you in our mountain communities. Your taxes are going to be so high it'll barely be worth it. Thats what happens when theres more people than homes in America. Work force before vacationers. Good thing it's the locals that make the laws.
Love your divisive us v. them mentality. If you choose to live in a lovely destination worthy of a vacation then you need to deal with vacationers. Without them you'd have a zero economy, in fact I'd bet if you looked a town or two away you'd see exactly what yours would be without "vacationers". Your living there year round doesn't make you special and your higher tax plan is only going to make your area MORE elite, widening the gap between work force and vacationers. Within 5 years when families need to tighten the belt and cut back on vacations the locals will be begging for people to come back and create jobs for the work force.
Would San Diego still be a profitable market for short-term? Homes are really expensive and duplex/tri are sparse. I have been looking at a lot of properties lately and get listings sent to my email. There are some that look like they might work but you might have to turn a garage into a guest suite and or make additional bedrooms or build adu. I been a follower/listener of bigger pockets for a few years now don't have any property of my own but I think I'm ready to jump into it and get my first soon. Would love any comments/advice THANK YOU!
Vacation rentals are not new, you guys act like you've invented a new way of investing. This has been up and running in full swing for 50+ years. Beware when the tide turns as this is the first segment to get cut off at the knees. When times get tough, vacations and vacation properties are the first to go as people circle the wagons on their home life.
Why couldn’t this woman rent out the part of the house for family to visit nephew as air b&b. So other deployed families can come see their loved ones in the service as well!
