Real estate reality

[StormRichards]

I can't imagine renting a home for $69 per night. My best guess is this is the slow season there and they would rather rent the place for something than have it sit empty. We do not subscribe to that philosophy.

I doubt breakage is any different there than a cabin in the woods. We rent to families all the time.

How much time does a family near Disney World spend at their vacation rental? Not much.

I would say if there is something that is over $100 to repair, we would charge the customer's credit card.

I am struggling with whether you have just been THAT lucky or if your bias for real estate influences all of your responses.

Everywhere my DH and I go we come across unruly children. We do not host parties because we see the way our friend's children behave in their own homes and the homes of other friends.

Using this Disney example, the parents get back to the room ready to pass out. The kids are hyped up from that Mickey Mouse shaped dessert they ate that they are bouncing off the walls. We've been to Disney and have heard the ruckus from neighboring rooms on many occasions.

Honestly, the exchanges with you and Steve come across as two adversaries with no middle ground.

Your comments about the "myths" of real estate come across as someone defending something they love and wanting to leave out anything that would be perceived as negative.

[Nutria]

Your comments about the "myths" of real estate come across as someone defending something they love and wanting to leave out anything that would be perceived as negative.

I bet TH rents out to a richer, more sedate clientele.

[disneysteve]

Doesn't sound like a place I would want to invest in.

We looked into buying a rental home here since we come regularly and rent regularly and are familiar with the area. I spoke to several owners and several local property managers. After all of those discussions, I determined that it just wasn't a good idea financially. I'm grateful that so many people came to a different conclusion so that we can rent such nice places so cheaply for our vacations, but it just didn't make sense for us to become owners as far as I could figure.

[rennigade]

I can't imagine renting a home for $69 per night.

Why not? I dont know what a townhouse costs near disney but they're probably not that expensive since housing is so abundant there (and its florida.) Lets say a townhouse costs $100,000. You can rent it out for $80/night and it rents for 200 days. Thats $16,000 for the year.

WE rented a townhouse in Kona for $180/night. I checked on realtor and the same unit/layout in the same development costs $580,000. $180/night x 200 nights rented is $36,000.

I may be looking at this completely wrong but the disney townhouse generates 16% of the cost of the house where as the Kona one generates 6% of the cost. Isnt that a better deal to own the disney unit even though you charge $80/night?


Edit: I just went on realtor and looked at places in orlando. Baller townhomes can easily be had for $180,000. Even at $80/night rented 200 days is $16,000...which is 8.8%...isnt that still better than the kona rental?

[StormRichards]

Here is another one of ours: www.CabinOnRiversEdge.com

I forwarded this one on to an Asian family we know through soccer. Little ninja Zack will find a way to break something of significant value. An outcome I would put my paycheck on.

[TexasHusker]

Why not? I dont know what a townhouse costs near disney but they're probably not that expensive since housing is so abundant there (and its florida.) Lets say a townhouse costs $100,000. You can rent it out for $80/night and it rents for 200 days. Thats $16,000 for the year.

WE rented a townhouse in Kona for $180/night. I checked on realtor and the same unit/layout in the same development costs $580,000. $180/night x 200 nights rented is $36,000.

I may be looking at this completely wrong but the disney townhouse generates 16% of the cost of the house where as the Kona one generates 6% of the cost. Isnt that a better deal to own the disney unit even though you charge $80/night?



Edit: I just went on realtor and looked at places in orlando. Baller townhomes can easily be had for $180,000. Even at $80/night rented 200 days is $16,000...which is 8.8%...isnt that still better than the kona rental?

$16K on a $100K vacation rental is just OK. The Kona arrangement is awful.

[TexasHusker]

I am struggling with whether you have just been THAT lucky or if your bias for real estate influences all of your responses.

Everywhere my DH and I go we come across unruly children. We do not host parties because we see the way our friend's children behave in their own homes and the homes of other friends.

Using this Disney example, the parents get back to the room ready to pass out. The kids are hyped up from that Mickey Mouse shaped dessert they ate that they are bouncing off the walls. We've been to Disney and have heard the ruckus from neighboring rooms on many occasions.

Honestly, the exchanges with you and Steve come across as two adversaries with no middle ground.

Your comments about the "myths" of real estate come across as someone defending something they love and wanting to leave out anything that would be perceived as negative.

Vacation rentals have their negatives. People tearing up the place isn't one of them. I'm ambivalent about what people think about them as investments - no skin off my back. There are plenty of investments that perform better. I own three locations of a franchise that knock the socks off of vacation rentals.

But I feel better holding some hard assets, and I want to find the best returns possible.

[TexasHusker]

We looked into buying a rental home here since we come regularly and rent regularly and are familiar with the area. I spoke to several owners and several local property managers. After all of those discussions, I determined that it just wasn't a good idea financially. I'm grateful that so many people came to a different conclusion so that we can rent such nice places so cheaply for our vacations, but it just didn't make sense for us to become owners as far as I could figure.

I think you decided correct. Central Florida is overrun with short term rentals.

[StormRichards]

Vacation rentals have their negatives. People tearing up the place isn't one of them.

This is an example of your bias and not reality. A simple google search and I can find many horror stories about an owner's vacation rental getting trashed.

[TexasHusker]

This is an example of your bias and not reality. A simple google search and I can find many horror stories about an owner's vacation rental getting trashed.

I am relaying my personal experience. Yours may be different. I have clearly explained that we spend about $10K a year on repairs and maintenance. Of course I am biased toward a vacation home as an investment; I wouldn't own 4 of them if I wasn't.

[StormRichards]

I am relaying my personal experience. Yours may be different. I have clearly explained that we spend about $10K a year on repairs and maintenance. Of course I am biased toward a vacation home as an investment; I wouldn't own 4 of them if I wasn't.

And that is wonderful that you have had great success with them. It is your statements like "Vacation rentals have their negatives. People tearing up the place isn't one of them" I have an issue with.

With your real estate success and your franchises that are even more successful, one can easily make the assumption you are an intelligent person.

So why taint that with idiotic statements that you are smart enough to know aren't true? A respectable statement would be "I know there are horror stories of vacation rental properties being trashed, but fortunately I have not experienced that with my properties."

Instead you suggest those stories are myths and constantly argue any negative statements about real estate. It make it difficult to take you seriously.

[disneysteve]

This is an example of your bias and not reality. A simple google search and I can find many horror stories about an owner's vacation rental getting trashed.

There's a big difference, though, between "reality" and "personal experience". It's also a matter of relative risk, too. If every rental home was routinely getting trashed, nobody would ever want to own one. Of course it happens. But I doubt it is a common occurrence. I'm sure the wear and tear stuff is a far bigger issue.

[TexasHusker]

And that is wonderful that you have had great success with them. It is your statements like "Vacation rentals have their negatives. People tearing up the place isn't one of them" I have an issue with.

With your real estate success and your franchises that are even more successful, one can easily make the assumption you are an intelligent person.

So why taint that with idiotic statements that you are smart enough to know aren't true? A respectable statement would be "I know there are horror stories of vacation rental properties being trashed, but fortunately I have not experienced that with my properties."

Instead you suggest those stories are myths and constantly argue any negative statements about real estate. It make it difficult to take you seriously.

We manage 30 vacation properties in total and have been since 2011. We gross over $1.2 million a year in revenues. We have never had a home "torn up" beyond a $200 or $300 amount.

[StormRichards]

There's a big difference, though, between "reality" and "personal experience". It's also a matter of relative risk, too. If every rental home was routinely getting trashed, nobody would ever want to own one. Of course it happens. But I doubt it is a common occurrence. I'm sure the wear and tear stuff is a far bigger issue.

I agree with you completely. However, many of his statements suggest it is a non issue. A myth. That is total BS!

[StormRichards]

We manage 30 vacation properties in total and have been since 2011. We gross over $1.2 million a year in revenues. We have never had a home "torn up" beyond a $200 or $300 amount.

Again, congratulations for your success. None of the above changes the fact that it does indeed happen and is far from a myth. And there is no doubt in my mind you are fully aware of that and that you have been fortunate.

The friends I have that own vacation rentals love to talk real estate and have many acquaintances (both online and off) that they "talk shop" with. I have heard second hand stories about some of the things their acquaintances have dealt with.

Do you not have any acquaintances that you talk shop with? If you do, do you not hear any horror stories? For a person that loves real estate investing like you do, do you not belong to any online RE forums?

The impression I have is that you get into the RE vs Stock market debates so often on here that you shy away from ever discussing any of the negative aspects of RE Investing. And I think that is a shame and a disservice to those that might have a genuine interest in RE Investing.