Short Term Rental Investment In Galveston TX | To Live And Buy In Texas
Summary
TLDRCynthia Quarter, a realtor from Galveston, shares insights on short-term rentals, emphasizing the importance of personal goals, location, and ROI. She advises on market research, property features like pools and golf carts, and the costs involved in furnishing and maintaining a rental. Cynthia also highlights the benefits of short-term rentals for both investment and personal enjoyment, and the necessity of a local property manager to handle maintenance and guest relations.
Takeaways
- 🏠 Personal Goals: Determine what you want from a short-term rental, whether it's personal use or a money-making venture.
- 🌊 Location Research: Explore different areas, such as beach or canal side, to find what suits your preferences and investment goals.
- 🔍 Reconnaissance: Use platforms like Airbnb to book and experience different properties to understand what works for you.
- 👨👩👧👦 Family Considerations: Think about the size and type of property that will accommodate your family's needs.
- 💰 Investment Analysis: Calculate the return on investment (ROI) considering the entry price and potential rental income.
- 📈 Market Fluctuations: Be aware that the rental market can be influenced by economic conditions and travel trends.
- 🏖️ Seasonality: Understand the peak and off-peak seasons and how they affect rental demand and pricing.
- 🏡 Amenities: Consider community amenities like pools, golf carts, and beach access that can enhance the rental experience.
- 🛋️ Furnishings: Factor in the cost of furnishing the property, which can significantly impact the initial investment.
- 📸 Marketing: Invest in quality photography and social media presence to attract potential renters.
- 👷♂️ Property Management: Consider hiring a local property manager to handle maintenance, cleaning, and other operational aspects, especially if you're not nearby.
Q & A
What is the main topic of discussion in the video script?
-The main topic of discussion is short-term rental properties, specifically focusing on what to look for when considering this type of investment in the Texas market.
Why is it important to understand personal goals before investing in a short-term rental property?
-Understanding personal goals is crucial because it helps determine the type of property, location, and investment strategy that will best suit an individual's needs and preferences.
What does the host suggest doing to get a feel for the short-term rental market?
-The host suggests doing reconnaissance by using platforms like Airbnb to book and experience different types of short-term rentals to understand what works and what doesn't.
How does the host describe the importance of location in short-term rental investments?
-The host emphasizes the importance of location by discussing factors such as proximity to the beach, access to amenities like community pools, and the legalities of certain features like golf carts in different neighborhoods.
What are some of the peak seasons mentioned for short-term rentals in the Texas market?
-The peak seasons mentioned include summer, festivals, the cruise season, and holidays like Christmas and Thanksgiving.
Why is it recommended to have a property manager for a short-term rental property?
-A property manager is recommended to handle maintenance issues, middle-of-the-night calls, and other responsibilities that may arise, especially if the owner is not located near the property.
What are some of the costs associated with starting a short-term rental business that should be considered?
-Some of the costs include the purchase price of the property, furnishing expenses, photography for listings, and potential management fees.
What is the host's advice on negotiating management fees for a short-term rental property?
-The host advises that management fees are negotiable and encourages potential investors to negotiate these fees to maximize their return on investment.
Why is it essential to consider the furnishing of a short-term rental property?
-Furnishing is essential because it can make or break the appeal of the property to potential renters, and it includes not only furniture but also items like dishes, pots and pans, towels, and silverware.
What role does social media play in promoting a short-term rental property according to the host?
-Social media plays a significant role in promoting a short-term rental property by helping to build a following, sharing updates, and engaging with potential renters through platforms like Instagram and Facebook groups.
What is the host's final advice for those considering investing in a short-term rental property?
-The host's final advice is to focus on personal goals, consider the return on investment, evaluate the location, and think about the practical aspects of managing the property, including insurance, taxes, and furnishing.
Outlines
🏠 Short-Term Rental Insights: Goals and Market Analysis
Cynthia, a realtor from Galveston, Texas, introduces a discussion on short-term rentals, emphasizing the importance of personal goals and market research. She suggests considering factors like location preferences, property type, and family needs. Cynthia advises using platforms like Airbnb for reconnaissance, assessing personal experiences to determine what works best. She also touches on financial considerations, including startup costs, potential returns, and the importance of being conservative with estimates to avoid financial strain. The video script highlights the significance of understanding peak and off-peak seasons, and the impact of local events on rental demand.
🛋️ Navigating the Costs and Management of Short-Term Rentals
In the second paragraph, Cynthia delves into the financial aspects of furnishing a short-term rental property, which can be a significant expense. She estimates costs ranging from $15,000 to $20,000, depending on the house size and desired finishes. Cynthia stresses the importance of high-quality photography and an active social media presence to attract renters. She also addresses the necessity of property management, especially for those not in proximity to their rental property, detailing the roles and benefits of a property manager, including handling maintenance issues and guest inquiries. The script suggests negotiating management fees and emphasizes the value of local management companies with a good reputation.
Mindmap
Keywords
💡Short-term rental
💡Personal goals
💡Realtor
💡Return on investment (ROI)
💡Appreciation
💡Offseason
💡Furnishings
💡Photography
💡Property management
💡Maintenance
💡Insurance
Highlights
Introduction to the topic of short-term rentals with a focus on personal goals and the importance of location.
The need for research on the short-term rental market, including using Airbnb to understand different property types.
Personal experience with renting a Canal House to determine suitability for a short-term rental.
Discussion on the importance of considering the size of the property for family use and the potential for rental income.
Emphasis on calculating the return on investment (ROI) and the importance of conservative estimates.
Highlighting the peak season for short-term rentals and the significance of understanding the off-season rental potential.
The role of local festivals and events in boosting short-term rental demand.
Importance of understanding the costs involved in startup, including principal, interest, taxes, and insurance.
The value of equity in real estate and its role in long-term investment growth.
The impact of amenities such as community pools, golf carts, and elevators on rental appeal.
The cost and importance of furnishing a property for short-term rentals, including the potential expense.
The necessity of professional photography and social media presence for marketing short-term rentals.
The benefits of using a property manager for short-term rentals, especially for remote owners.
The potential for high maintenance demands and the importance of having local vendors for quick response.
Negotiating management fees and the potential savings that can be added to the bottom line.
The comprehensive approach to considering all costs, including insurance and taxes, in the ROI calculation.
Encouragement to subscribe for more information and to share personal experiences with short-term rentals.
Transcripts
welcome to live and bu in Texas I am
your host today Cynthia cter and I am
going to talk about all things
short-term
[Applause]
rental so this is just going to be a
conversation about what to look for I'm
a realtor in Galveston which is the
Third Coast we are south of Houston and
it is a very very popular short-term
rental market so through the years I've
learned a few things so I'm just going
to share with you what I've learned so
first thing you want to do is what are
your personal goals you know when you're
looking at a a business such as a
short-term rental this is going to be
your house this is going to be your
properties it's not going to be booked
all the time so what will work for you
and your family you know what kind of
goals what location do you like to be on
the beach side do you maybe want to have
a boat in the water on the canal side do
some reconnaissance go out there get on
Airbnb see what other people are doing
and book you a place and go see what you
like over the holidays me and my husband
we were looking to buy a house we're
we're actually buying a house right now
and so I went on Airbnb I don't I don't
know where I want to live live you know
so because we live here in Galveston
fulltime so I rented a Canal House
didn't want that too far out from town
didn't want that got a beach front house
and believe it or not I love the beach
front house but it was way too windy for
me so I'm still looking so go out and do
your reconnaissance and see what will
work for you are you going to be using
it with your family you want to think
about the size those types of things if
it's just money if it's just a line item
and you want the money maker then of
course that is going to be your goal and
you don't care where it's at because you
don't intend on staying there right so
the return on your investment how much
bang for your buck you can get so if you
can get a lower entry price point and
rent it for higher get yourself a
spreadsheet if you're not into
spreadsheets that's fine put it in on
your piece of paper and just crunch the
numbers for what kind of a return on
your investment some of the YouTubes
I've seen you know do get a short-term
rental 100% cash flowing that is likely
not going to happen right out the gate
so you have got to look at what it's
going to cost you in startup costs and
really be conservative on your numbers
because you don't want to get yourself
in a situation where you're upside down
likely the note the principal interest
taxes Insurance all of those things that
would be great if your rental income
could cover that but it's highly
unlikely it just is so you you want to
also look at the equity piece of it
where you're having an appreciating
asset that's just going to keep
appreciating as the real estate piece of
it and be conservative on your numbers
so you don't get yourself in trouble so
your return on investment is going to be
important now we definitely have a peak
season during the summer and then we
have festivals in the offseason of like
Marty gr we're known for Marty gr here
and uh we have the cruise terminal with
a lot of people come and uh stay a few
nights in town and then jump on the
cruise and Christmas and Thanksgiving
and holidays and stuff like that but you
want to Crunch the numbers for the
offseason and any short-term rental
rental management company or a realer
like myself we can give you a pretty
good idea of how many nights it'll book
what for the property that you're
looking at which is interesting if it's
new construction or it hasn't been used
for a short-term rental before we can
project those but it depends on the
economy the market are the People Are
People traveling if something has
already been a rental we get rentals
from the management company and break it
down what has this done year over-year
and what's it going to mean for your
investment one of the reasons I love
short-term rentals so much and it's a
passion of mine is because this is the
one investment that you can make
memories in and again we're going to go
back to using your investment for your
own purposes let's talk about many ities
is there a community pool is there a
golf cart that's accessible that you can
zip around on is the golf cart legal in
that neighborhood elevators are really
important in our neighborhood because
everything's built on py Lanes beach
chairs access to beach all of those
things and do your homework because some
of the communities they have pools but
they do not allow renters to use them
and that could be a a bad review so you
really want to do your homework on that
you want to talk about the Furnishings
too so this is a big expense when you're
doing a short-term rental if you buy a
vacant house with no Furnishings you've
got to furnish that home time effort
movers money you know 15 20,000
depending on the size of the house and
the finishes that you want I mean you
could go as crazy as you want on that
right but this furniture is it's going
to make or break the place and then you
got to get photography you want to take
pictures people buy online and video if
you could do pictures and video and open
yourself up a social media account and
just start blasting that every day post
something about that Google community
activities or whatever but get yourself
a following on social media so your
house has its own page and then get
involved in Facebook groups and get on
Instagram and get a local photographer
and get your home ready to go put it on
Airbnb and
VRBO and go live a couple business
things before I let you go let's talk
about
management so property managers if you
are not near your wherever your
short-term rental is I highly encourage
you to have a property manager because
one thing you don't think about when you
want to do a short-term rental um
maintenance those middle of the night
calls how does the Wi-Fi work the
lockbox code isn't working now if your
hands on you want to take those calls my
hats off to you I worked in a short-term
rental management company for a long
time and in summer on the same day all
the AC's broke you know so it's it's so
they have local vendors and they know
who will show up and do a good job for
you so short-term Rental Management
cleaning booking advertising all of that
stuff and the maintenance here is a
PRACK tip though get somebody that is
local of course there's big huge
companies you know them all but they
have offices who knows where so you want
to get somebody that is reputable of
course reviews all of that so management
management you can that line item is
probably going to be about 20% to manage
your property here's another Pro tip
that management fee it's negotiable
don't just take it it there's so many
management companies here in our
neighborhood I know that they want
business so negotiate those fees you're
not going don't lowball it because you
you know you get what you pay for but
just think about even if it's a point or
two that's a that's added money to your
bottom line so that's what I have for
the shortterm rentals in our area you
want to focus on your goals look at your
return on investment the location this
is an investment that's not just an
investment but you can use it and make
memories there and have a business while
you're doing it you want to look at your
principal your interest your insurance
oh I forgot about insurance get quotes
agents will give you insurance quotes so
uh Insurance the taxes the insurance put
all those in your line item on your
spreadsheet there
Furnishings see how you want to furnish
that make sure you think about dishes
and pots and pans and towels and
silverware glasses all of it and then
who is going to manage this property for
you you're going to self-manage or not
and make sure you get on your local
website see what it's going to cost you
to register it usually they make it
super super easy here in galvaston it's
very easy to register and if you like
what you heard today and want to see
some more of it hit the Subscribe button
my information is in the description
section of my YouTube channel leave a
comment what's been your experience with
a short-term rental and what Pro Haack
do you want to share with others who are
thinking about getting into this
business this is Cynthia quarter to live
and buy in Texas go out there and make
some memories with your Investments
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