Buying a Short-term Rental?

If you’re thinking about buying a short-term rental, your
gut feeling about a property is important but not as important as running the
numbers to shed light on whether or not a property will give you the financial
return you’re looking for.

So as you consider properties, keep these 5 things in
mind:

1) Cash flow analysis: The expected monthly rental income
minus all expenses, including mortgage payments, property taxes, insurance,
maintenance and cleaning costs, and Airbnb fees.

2) Occupancy rate: The percentage of occupancy in your
property at a given time. The expected occupancy rate for a property will
affect its cash flow.

3) Location analysis:
The local market, competition, and seasonality will impact rental rates.
Compare properties to ensure yours is likely to generate enough income to cover
costs.

4) Capitalization rate (CAP rate): A measure of the
property’s expected rate of return. Find it by dividing the net operating
income by the purchase price or current market value.

5) Tax implications: Consider the tax implications of
owning a rental property, including the impact on your personal income tax and
the potential benefits of depreciating the property.

The truth is not all short-term rentals are created equal.
Before you jump in, make sure you consider these things that can help you own
profitable rental properties.

Do you have any other questions about short-term rental
investing? Give me a call!

-Megan Stultz

Call or Text 936-537-2587

Megan@MeganStultz.com

www.Southern-Luxury.com