I’ve been hosting for about a year in my backyard granny unit. Last fall we bought a 2br 1ba house down the street because it was perfect as a STR. We are endless renovators, and have never bought a property so nice before! The former owner died tragically in a car wreck, and her heirs had all moved away. So we purchased the entire property with all of the items inside (after the family had taken away all the items that they wanted.). One of the reasons we jumped on this property is that it has a lovely south-facing 2 car garage that we can renovate into an STR, and it has a full attic where we can add a 2nd bathroom and another bedroom or two. It could potentially be rented as a separate unit if we added a kitchennette. Both tenants would share an entryway, and the stair will have to be small (steep) and probably curved or L-shaped.
Aaaaand, because we could become famous for biting off more than we can chew, we also are planning to convert the falling-down garage on our own house property, so that our backyard will have 2 rentals on it.
We have this new house rented for the next 4-6 months to a traveling professional, so that should give us some time to work on renovation this summer. We are considering which project to break into first, if we are looking to maximize our income long term.
Does it make a difference from a tax perspective whether we invest more in our own property (our primary residence), or whether we invest in this new property which is held in an LLC? All of our income from the properties will just be claimed via this LLC, but the ownership is different.
For reference, We have a 30yr. mortgage on the 2nd property, and our monthly expenses are around $700 for that property. We have rented it out this spring/ summer for $1500 per month. We have about $16K of a high-interest old mortgage on our primary residence, but otherwise it is paid off. Over the past year, I have become disabled to due a rare GI condition, and my workaholic husband is “trying to quit” our solar clients (previously our primary source of income). So our focus right now is sort of long term investment in our properties. We will have low incomes for the next few years, I imagine, as we are doing renovations, trying to get our kids to preschool/ kindergarten, and seeing a shit-ton of doctors. I will start the process of getting on disability as soon as I can face the reality of calling Adult Protective Services, but that should stabilize our income and some of our financial worries. I have thought I may die on various ocassions over the past year, so my main focus is on taking care of my 3-generation family long term via my work with real estate. And my other focus is on just spending time with our kids and trying to disguise our freqent travel to specialists as “vacation.”
In my case , Airbnb has a total godsend, because of the instability of our social safety net in America. I think it has saved us from medical bankruptcy. But I also intend to build the whole thing independently of Air so that I ‘m not dependent on them particularly. My experience as an entrepreneur and as a newly-sick person has taught me to always cover my bases! Thanks in advance for your thoughts