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So we are “soon to be hosts.” We are actually looking at properties next weekend (9 days from now) with an eye towards hosting. In about 4 months we will begin some extensive travel within the US but we want a “landing spot” for the coldest months and to deal with some necessities. We also want to be able to maintain our TX residency and such.
I have already looked at many topics here and I didn’t see this one question addressed.
We are looking at buying a condo. Either a 1BR or 2BR in a “destination area.” This area has a lot of AirBnBs and some have views of the golf course and a few have water views and some really have not much of a view. Obviously one “pays” for the view. But from a standpoint of renting the unit, how important is the “premium view” when a guest is looking at renting? This area has much to offer out of doors. It’s on a lake. And there’s a golf course, marina, boat rentals, and even near hiking trails and more. My thought is that if rental rates drop, better views would get more rentals. And while rentals are “tight” you can charge a little more for the view.
So, opinions/advice requested. Pay for the view or not?
Questions: Would your guests be allowed to use the golf course? Have you thoroughly looked into the HOA rules as well as local/county/state regulations about short-term rentals? Do the HOA rules support short-term rentals? If so, how many other short-term rental properties would you be competing with?
And, the biggest question, can you easily afford the condo even if you don’t get any guests? For example, if the condo’s HOA rules change to prohibit short-term rentals?
Yes, the guests can use the golf course by paying non-member fees. Joining the course is extra even for us if we were owners of the condo.
Plenty of STRs in the same association and other associations in that same area so we are good to go on whatever unit we end up with.
According to AirDNA there are 187 rentals in our market. Everything from studio condos to 5+ BR houses. In the 1BR “whole unit” and 2 BR “whole unit” (which is mostly condos) there are 35 and 50 respectively. Is 1BR or 2BR “more rentable?” Actually, I can use AirDNA to see what the occupancy rates are for each.
Yes, we can absolutely afford to have zero rentals. We actually were planning on NOT renting but then the fact that the unit would be empty 9 months out of the year caused us concern. But excellent question.
As a guest my willingness to pay for a view would depend on what kind of vacation it was. If, to see the view I have to sit on a small balcony or sit inside and look out only to see a lake, my answer is probably no. If I’m renting a house with a large deck and I’m going to be out there socializing and grilling, yes.
I had a friend with a house on Canyon Lake, TX with a view. They lived there, spent time on the deck and enjoyed the view. But if I went there as a guest and planned on spending most my time golfing or on the lake I don’t need a view.
Would you enjoy having the view when you are there? If, over the course of the payment term you feel that the extra you pay for the view unit is worth it, then go for it that way it’s a no lose proposition.
Yes, we probably would enjoy the view and more likely to be inside during the months we are there as it will be Dec-Feb. I was just wondering about a view as a factor in renting. Good points you made. So it’s really about us wanting to pay for the view for our own enjoyment.
I have a whole house rental on the Jersey Shore which offers lots of activities and I’m always surprised at how many folks stay in and just hang out. Therefore, keeping these folks in mind, I feel a view would be a plus.
You described my rental area exactly. North Myrtle Beach Area of SC.
Check out the market competition by looking at the number of area rentals on VRBO & Airbnb. If your area truly only has 187 rentals that is bittersweet. You will be a big fish in a small pond but if the rental demand is there, seems you should have more competition.
Also snoop the competition rates & calendars. Are they already booking their summer? Gives you an idea of what to expect.
View important-maybe, maybe not. View meaning directly on golf course, marina with jet ski rentals or fishing, or ocean front. Yes view is important because means close to desired activities. View for view’s sake -a few renters are willing to pay a premium for a view.
My 2 Br condo has no view, 1 mile to beach but comfortable and reasonably priced and close to shopping, dining & activities.
I tend to book earlier than my higher priced neighbors with a waterway view. However they eventually book at a higher rate.
It’s a trade off. My unit didn’t cost as much to purchase.
This year rentals in my area have been awful. To make ends meet, I’ve moved my 1Br condo to LTR and am considering doing the same with my 2br until next year.
ask your realtor if there have been a lot of sales to new owners seeking to also use it for STR. It will give you an idea of new listings. My area is swamped with new listings on Airbnb & VRBO.
I’m considering LTR to give those owners a chance to weed themselves out. Looking back at my first year I was unprepared for the time required, some of the craziness some guests can bring, damage/maintenance required, always fixing something when I’m trying to enjoy a beach visit. Etc.
For example: my former neighbor decided to rent on VRBO (had not rented in past). She told me she had watched me “rake in that easy money and decided she’d do it too”. After 18 months of renting she declared it too much work & sold her condo.
Prior posts in this thread give valid good advice so take it all in and figure out what is important to you.
Best wishes on your new business venture. Be flexible, willing to learn, and you can be successful
I’m on record here saying that for me, yes, it is. It’s the easiest job I’ve ever had. But much of it depends on what kind of rental one has. I think if a host isn’t on site (like the OP) it is much more work.
I also think that levels of competency matter. If one is like muddy and I and able to fix many things that go wrong themselves, it’s easy. If you have to call a professional for every single fix it becomes a huge headache. Also if you don’t have the chutzpah to confront guests who violate policies you create more headaches for yourself.
I’ve advised a couple of people locally about doing Airbnb and I honestly don’t think they would last. So I tried to make it sound like more work than it is for me.
Here’s an example from a true story reported first hand to me by a host not on this forum. The guests in the rental reported that there was a water leak in the bathroom that they mopped up with towels. The host went in and saw no water and did nothing immediately. Then later water reappeared. The plastic connector on the bottom of the toilet tank, connecting to the water supply, had cracked. This is an easy do it yourself repair if you have some simple tools. By the time she got it repaired there was damage to the floor and a warped baseboard. She had no competency at all to head off the problem or fix it herself. Imagine that sort of thing happening multiple times per year in your typical rental.
I’ve never found it a hard job at all, and yes, being on site, handy at fixing thi gs myself does help. Also not having a place that sleeps large numbers of people.
But I imagine some hosts who are shocked that it didn’t turn out to be easy money may also have had some idea that you just list, guests book, you get the money, and that’s it. They didn’t anticipate the reality we understood is part of the job, that yes, you are going to encounter stained linens, some guests who require more hand-holding than others, that your nice dinner set for 8 is going to end up with some pieces broken, that you may need to make things clear to guests who don’t bother to read, etc.,etc.
I think the cleaning is the biggest issue, then the enormous amount of washing after each stay. The wear and tear with non caring, hotel minded guests.
I am on duty 24 hours a day, because this is my business. When we had international travel I would respond when ever I got an enquiry or a booking, often at 2 in the morning. Dealing with bookings in Australia when I was visiting our properties in Greece - this was normal.
This business is not a change of sheets and a swish of the bathroom!
And if we were guests at a place when the connector hose started leaking, we’d be able to suss that out easily, we’d shut off the incoming water valve for the moment, and notify the host. At least I would.
I feel sorry for homeowners who don’t have any skills to repair even simple things. Must get quite expensive.
A friend of mine was managing a small hostel for my other friend who owns it and was out of town. The one managing has no skills in the fix-it dept, so when the toilet was running and the toilet flapper needed replacing, she said to the cleaner who’s been working there for years, “I guess we need to call a plumber”.
The cleaner looked at her pityingly and said, “It’s a toilet flapper, it takes 2 minutes to replace. I’ll do it”.
One other consideration as I’m sure you’ll read the fine print, but some associations (like the one I was president of a long time ago) have a percentage target for rentals vs owners. Once the percentage of rentals to owner-occupied gets to the max, then no more rentals are allowed. That rule was in place long before I got there and caught some people unawares. The purpose was for property values and I also think it mattered for insurance purposes.
If you have one of the best views, you will probably be one of the first rented. The less the view, the farther down the list you will be in their priority. But you can’t charge too much more, the increase in volume should make up for that.
I also think that if it’s too big it won’t rent as well. Not knowing who visits there most, it sounds like a couples destination. Just because you buy a three bedroom doesn’t mean people will pay more for it. Especially if they don’t need the space. A lot of hosts think the bigger the place the more they will make. It’s true to some extent, but not exponentially.
One more comment, IF your interior can look much superior (bedding, welcoming atmosphere, CLEAN, newer furniture, more amenities) you may be able to get yours rented before all the others without a view. However, I still think the view will book first.
Also note the income of most the people who visit there. If it’s a place like Orlando, where there are a lot of families who can not afford much, you might very easily rent without a view. But if it’s a destination for the more affluent, you definitely should get a view (depending of course on your homework regarding cost analysis).
I love YouTube. When I gutted a condo a few years ago, I ran out of money. Out of necessity I learned to install & plumb two bathroom faucets & sinks, kitchen faucet & sink, disposal & dishwasher. There are HOW TO videos for everything!
I know, you can learn how to do anything with those videos. I learned how to change out the motherboard on my washing machine, adjust my industrial sewing machine, and troubleshoot and fix a toilet that wasn’t doing a full flush.