This episode is Sponsored by MarketMySTR.com the STR Industries #1 marketing platform.

Topic: Underwriting for Short-Term Rentals:

Key Takeaways:

1. Proper Underwriting:

• Overestimating revenue and underestimating expenses can lead to costly mistakes in short-term rental investments.

2. Expense Estimation:

3. Granularity in Calculations:

4. Hidden Expenses:

• Expenses like insurance, utilities, and climate-related costs can be overlooked but are crucial.

5. Market-Specific Expenses:

• Expenses vary by market; consider factors like snow plowing and trash collection.

6. Interest Rate Impact:

• Changing interest rates can affect mortgage expenses, so stay updated on current rates.

7. Set-Up Time and Costs:

• Factor in the time and costs required to prepare the property for guests, including travel expenses.

8. Annual and Legal Fees:

• Include fees for LLC renewals, legal matters, taxes, and miscellaneous costs in projections.

9. Tech Fees:

• Account for technology fees associated with property management, pricing tools, and marketing.

10. Conservative Projections:

- Overestimate expenses by 10% and underestimate revenue by 10% in your pro forma calculations for a more conservative outlook.

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