Property 1. In our price range, close by, long term rental, good neighborhood but lower priced houses to make our price range, managed ourselves, minimum work to lightly update. Worked out great with steady monthly income.
Property 2. Air bnb on a lake. 2.5 hours away, property manager but requires lots of trips by my H for light maintenance. Fully renovated and furnished. In our price range but needed more renovations so knocked us out of our price range ultimately. Only summer rentals. Great summer income, no winter income. Property manager for the guests, bookings, cleaning etc. Issues with shared dock with neighbors.
Right now property 1 is doing much better money wise and stress wise. These are 2 different business models and the point is to compare them. We can enjoy property 2 when no one is there but it will take a few years before it’s profitable. Property 1 is profitable now and the profits cover both mortgages.
Gut feeling answer - I wouldn't. I'd put it in the markets and go from there.
Given how hard it is for my business to find good employees who put their heart and soul into their job duties, I wouldn't assume it's easy to find a property manager. It sounds like a huge pain to manage a single rental property not within a reasonable driving distance.
Where I live, $250K wouldn't buy much of anything. I just threw it into Zillow and the closest single family home to me is $258K. It's a Cape Cod style home probably built in the 1950s and it's listed as a fixer upper. Everything cheaper than this home was a 1 BR condo.
Post by wesleycrusher on Dec 1, 2022 9:25:04 GMT -5
My ILs bought a rental property a few years ago in their own suburban town, so for long term rental use, not a vacation property. It is a one story, wheelchair accessible condo. They are in great health, but their plan was that they could use it when they get older if they can no longer manage the stairs in their current house.
The short term rental market has been flooded in the last few years; we own one and we've seen a huge increase in the number of competitors. This may be thwarted by local regulations trying to limit those numbers.
Off the top of my head - At that price point, I might look at the Smokey Mountains in TN; I've seen it recommended.
Post by imojoebunny on Dec 3, 2022 12:17:23 GMT -5
I would do a single family rental in an up and coming neighborhood that is popular with 20-30 year olds. Preferably, a brick ranch, since maintenance is usually less. Land appreciates, structures depreciate. I own a house in a vacation area, and it has been a solid investment, but not like our intown rentals, where not only has the property value gone up, but the rental rates have increased a great deal. We don't rent out the vacation home, but if we did the expenses would be much higher (furnishings, hot tubs, extra maintenance, ect) than our long term rentals, especially, if we used a rental company. We self manage our rentals. We had two duplexes for 18 & 24 years. We just sold the one we have had for 24 years. We still have the second one. They have been very good investments for us. I am a SAH, so it has been a great way to boost my retirement savings. If you want a vacation house in an area, to use, by all means, it can be great to rent it out when you cannot use it, but as an investment, providing housing to younger, more transient, and lower income people, will be a both a good investment and will always be in demand. I am of the belief that it is good for communities to have rental housing. Not everyone shares that belief, but our tenants are great people, and it makes me happy to be a good landlord to them.