Have like 50k cash layin around and looking to buy beach property to function as a short term rental so i can do a cost seg and get a large write off in year 1. Anybody have experience with this? Do i need more cash? Any downsides?

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Where are you looking that $50k is enough down?

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Beach properties are getting destroyed in insurance. We sold a condo this year that had crazy insurance assessments last year and this year. Paid an extra $4000 in master insurance fees last year, $3000 for this year and expecting another assessment mid year.

SFH is a little different but also costs are going up for insurance.

I have beach property that we use and rent out, but it required much more capital. No real insurance issues for me. We faired well when the flood maps were redone a couple years ago.

What state are you planning to buy said property in? You typically need 25% down on an investment property, which means $50k will only get you a property around $175k (when including closing costs and such). Do you have any reserves on top of the $50k to cover expenses while you get ramped up? Does it cover furnishings? Those aren’t cheap…

Also, a lot of beach communities are increasing the requirements for operating a short term rental with permits, limits on capacity, neighbor notifications, noise ordinances, etc… on top of a lot of vacation communities seeing saturation and lowering occupancy rates.

There’s a different lending service for the leaders of the consulting firms.. very different conditions, clearly all favorable

All helpful posts. Sounds like i need to save up more cash. Probably a smaller townhouse a few blocks frrom beach in destin since i dont want to be tied to condo fees. 400-500k. Is 25% a lender requirement? Also yeah i have another 20k in my emergency fund and we typically save ~5k a month after expenses so can rebuild quickly once the property gets to breakeven.

Mine were bought as second homes and required 20% down. Sometimes you can find a lender that does 10%. However you can’t factor rental income into your ability to qualify for the mortgage. You’d have to meet the debt to income ratio requirements without considering rental income.

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