{ "media_type": "text", "post_content": "Thinking about investing in real estate but I’m super new at this and not sure where to get help. I saw a few apt/townhomes for sale in a prime location in my city. They’re around $110-$200k each and most over 1k sq ft. I’m thinking of getting one and turning it into an Airbnb. HOA and tax are a bit pricey (adding an extra $700-$1k/mo). Would this be a good investment?\n", "post_id": "61e6f94af389af002ad82541", "reply_count": 12, "vote_count": 4, "bowl_id": "5a5242b78e26290018502ca0", "bowl_name": "The Real Estate Bowl", "feed_type": "bowl" }

Thinking about investing in real estate but I’m super new at this and not sure where to get help. I saw a few apt/townhomes for sale in a prime location in my city. They’re around $110-$200k each and most over 1k sq ft. I’m thinking of getting one and turning it into an Airbnb. HOA and tax are a bit pricey (adding an extra $700-$1k/mo). Would this be a good investment?

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We followed a model that my dad and his RE investor friends have used for their thousands of rentals over the past 20+ years. It's basically a way to mitigate risk as much as possible, and set your rental up for long-term success: - 3 bedroom / 2 bath single-family home - 1200-2200 sq. ft. - has a garage anything smaller and tenants become unhappy or more likely to move for more space; anything larger and tenants typically begin looking for homes to purchase themselves rather than rent from you - no two stories - no foundation issues - no large tree in close proximity of the property this avoids costly maintenance issues later on - even though foundation fixes can be done affordably, why set yourself to take on this expense when you can find a property elsewhere without this issue - not across the street from a school - not on a busy/main road - cul de sac home preferred if you can find one this is simply to ensure a better, quieter, safer experience for your tenants - in a neighborhood that has a better school district rating (families will likely stay longer than couples/singles) - utilize the market data that other big companies pay millions of dollars to do, and follow those same areas. Companies like Kroger, The Joint Chiropractic, Publix, Chipotle, etc. tend to focus on specific demographics in high-growth areas. They're usually a bit more elevated, so your tenants likely will have slightly better credit scores than say a neighborhood that has a Stater Bros or bargain market grocery store. And most importantly make the numbers work. Someone else said it before me, but your rental income should cover PITI + we allocate 10-15% maintenance costs. Once you have the house picked out, there's also some budget required to do certain things to the property so it's marketable and well-maintained: - hire landscaper to mow the lawn monthly / bi-weekly so you ensure your property doesn't turn into a dump - install ceiling fans if they're not there already - make sure you have good plumbing & lighting fixtures throughout - these will end up being annoying maintenance requests that are sure to come up later - if you're supplying appliances and washer/dryer, include in your lease that it's being supplied by you but maintenance is on the tenant (if it dies, it's not on your dime to fix/replace) Hope that helps! We were able to purchase our first two properties last year with this criteria and net about $1000 per property. (We purchased both in the low $200K range) Good luck!

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Oh I forgot to include driving through the neighborhood. Avoid neighborhoods that have junk in the yards, old cars in the driveway/lawn etc. And avoid any neighborhoods with bars on the windows. Both of these present a sense of insecurity with your tenants and they'll be more likely to move out once they can afford something in a nicer, safer neighborhood.

It’ll be the first property I’ve ever purchased. I have most of my money in the stock market in index funds but I really want to get into real estate ASAP. I'm just not sure where to get good info. If there are some experts, videos, or books y’all can recommend, please do!

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You need to check legality of doing Airbnb in your area. Most HOAs & city codes in major cities do not allow short term rentals (less than 28-30 nights) of entire units that aren’t primary residences. An an aside, just because a listing is there on Airbnb doesn’t mean that the host or Airbnb are abiding by local zoning laws.

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If you want to be a successful real estate investor, you’ll need to understand how to crunch the numbers and evaluate if a deal is good or not. In general it comes down to: revenue potential per month minus all expenses (including a maintenance / vacancy coffer). If you bought one of these units, how much would you put down? What would your monthly mortgage + HOA + insurance + taxes + maintenance + management + vacancy look like? If you go the short term rental / Airbnb route, then you’ll have the up front expense of furnishing and stocking it (remember, you need everything including kitchen wares, multiple sets of towels & linens, etc.) as well as lining up vendors (cleaners, handyman, etc.). It’s a LOT more work. There’s also a lot of regulation and tax concerns that you need to account for if you are running a STR. I wouldn’t suggest someone start with a STR as their first real estate investment.

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STR’s generally will create more cashflow, but with a much higher initial cost as well as higher risk and substantially more work. I would say LTR’s are a better stepping stone for a first time investor, especially at that price point.

You should check out bigger pockets they have some great content on real estate as an investment

Yes Bigger pockets got some great contents on real estate. Send a DM I’ve few things to share with you . Thank you

Nope… condos with high HOA are difficult to sell and that’s why they come cheap . Have you looked into multiple family units ?

I have but a lot of the good ones are already taken and some are too expensive and others are in horrible areas :(

Does Airbnb require you register an LLC? If you registered an LLC and purchase short term investment condo to run on Airbnb. Does the LLC need to be reported on T&T?

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