You're about to invest six or seven figures in this property
Know the actual performance capability before you buy?
Let us investigate and calculate a creditable (independent) property analysis
Property Cash on Cash Analysis
There are a lot of property analyzers programs out there- yet most of them are not accurate. There are a lot of rules of thumb myths about what makes a property a successful property and investment. Short Term rentals are different than Long Term Rentals, in the fact that there are a number of subjective variables that determine the success of a Short-Term Rental.
Real World Facts STR's- its good old fashion hard work to get good results.
Some very important variables to consider!
#1 - Income potential of an STR is a range rather than a hard exact number.
#2 - An underperforming STR is almost always due to poor management not the property itself.
#3 - RentaI History - is never a good indicator of a property's potential - this is a shock to most buyers, seller and investors, but rental history is a poor indicator of a property's potential. Don't rely on anyone's numbers, do your homework.
#4 - There are a number of large STR- data companies out there, many of these companies offer property specific analyzers and projections. Yes, we do check them, but we do not place significant credibility upon their findings.
Click the button to send us your name and phone, and we look forward to assisting you on your property.
Use the form below to schedule a zoom call:
Property Analysis Program: You want the following.
1. Go to the actual booking program you plan to use on your property.
2. Go to the neighborhood of your potential investment
3. Find similar property, to your proposed property,
4. Examine the data on this property, to get a feel of what your property may do, that is price per night, on -off season, look at occupancy, look at the cleaning fees charged, required night stay in this market, pet policies.
5. Now, determine how you can compete with this property. Look for weaknesses in this market, how can you outperform this property.
Expense Analysis of Property: Important to run the numbers.
Look at the list of expenses your STR is going to incur. Many of these can be obtained from sellers or actual expense disclosures. Some must be retrieved from market. Water, Gas-utility estimates, HOA fees, Cleaning Fees, Maintenance Estimate- depends on condition and age. Pest Control, Insurance, Flood Insurance, Cash Reserves for the Property.
Now, lets get serious about the property!
Cash on Cash Analysis
Now you ready to crunch the numbers. In order to determine the Cash on Cash & GRM (Gross Rental Multiplier) return of your potential property, you must calculate the ROI, of the property, this is done via a Pro Forma analysis of the property.
Without an internally built Pro Forma, vou cannot truly determine the properties performance potential.
Property Analysis - Cash on Cash
Cash on Cash- is the name of the game in short term rentals, in simple terms this is the amount of money putting into the property, vs. the amount of money it returns to you.
Here is a simple formula- that I use:
Gross Annual Income - operating cash expense = Net Operating Income NOI
NOI - mortgage, taxes (fed & state) and insurance = Cash Flow
Cash Flow/Cash invested = Cash on Cash Return - Annual
Note: We are not concerned about tax liability in this analysis, so we do not take into account Cap Ex- items and non-cash deductions in our analysis.
We have benchmarks, that represent – a good or bad investment.
Short Term Rental Taxes:
Short term rentals get special tax treatment from the IRS and have significant benefits. Many real estate investors are adding short term rental properties to their portfolios, with significant success. Learn how short-term rentals are taxed is important for your future. Many still have questions about how short-term rentals are taxed, in addition, tax and legal structures, Investor concerns and confusion are certainly valid, due to fact the short-term rental rules are unique & complex to other types of real estate investments.
When reviewing your investment, you need to incorporate current and advanced tax rules, learning how these rules affect your taxes, is crucial, my office specializes in giving you the advanced tax law care- accurate and legal tax advice, you need for success and compliance.
We would be please to assist you, in your evaluation of your potential property. We communicate through out this process, to develop the answers you need to make an informed decision.
This process is different per property, (can be very time consuming) due to the unknowns, so we have set a flat fee of $895/property for this valuable service.
It can make all the difference in your decision to buy property.
Don’t invest six or seven figures in this property
Without knowing the actual performance capability before you buy!
We look forward to working with you.
Click the button to send us your name and phone, and we look forward to assisting you on your property.
Use the form below to schedule a zoom call: