Any real estate investors out there? I've got a handful of condos and rental homes. Been kicking around the idea of buying a vacation rental here in Alabama.

18 weeks of rentals makes my payments (annualized). I'm seeing some of these things clearing $40k per year.

Thoughts?

Are vacation rentals primarily by the week or weekends? Is it warm enough for year round renting, is this on the Gulf? What is the history of the rental unit in terms of the number of weeks rented out annually?

The one I've looked at rents for an average of $1200 per week. It stays rented for about 35 weeks out of the year on average That's about $42,000 per year.

On the gulf coast.

Dang, it is rented out 35 weeks a year at $1200 a week. That is almost too good to be true.

Have you done an all in cost ROI, based on that assumption?

Not yet. If it's a nice condo on the gulf coast, they do really well. I was just kicking tires to see if any other BOLers have any experience with these.

No personal exp but had a few customers in a prior that used the income stream to pay for the property and then after payoff used the property as a retirement/vacation home.

Don’t forget to consider wear and tear cost on the furniture and cleaning cost after renter leaves, cleaning coast depending on size could be couple hundred each time.

co-worker has some beach condos...she has use for 4 weeks of the year, remaining weeks are almost always booked...one she has had the same snowbird rent from October-March for 3 years...as long as there are no hurricanes it is fine...hurricane hitting that area, yeah, you better have some money saved until the economy comes back

ooh...I didn't consider wind and water insurance...can you get these for beach condos?

We are kind of due on the Gulf, it is been 6 years or so now ...

I'm thinking high rise condos (i.e. 15th floor). Not sure that I would need flood insurance. Maybe wind. Hazard would be covered by the HOA dues.

What happens if floors 1-10 flood and your condo is ruined? Would normal insurance cover that? I don't think the association's blanket policy for flood would only apply to certain floors.

How in the world would a flood (of a FEMA nature) reach anywhere close to the 10th floor? I would think the hazard policy would cover any type of flooding from broken pipes, etc. If we get a nature made flood that reaches the 10th floor, making it to the arc will be my first priority, not the investment.

Okay, that was an exaggeration, but if a flood destroys any of the floors below your unit, your unit may be inaccessible or damaged if the structure of the building is compromised. I'm sure if you spoke with other owners in the building you are looking at they could give you more info on what the association does and what they've done to protect against that sort of weather.

If any portion of the structure is in an SFHA then the entire structure is in the SFHA.

How old is the building? For the past few years new buildings on Alabama's Gulf Coast must be built to withstand category 5 hurricanes. After Ivan, sides of buildings were missing, even on the 15th floor.

I have not checked but I imagine beachfront is in flood zone V.

Check insurance. I am across the Intracoastal Waterway and can get standard insurance. On the island, it is through a pool.

Don't forget the condos and houses come fully furnished...all (very nice) furniture, linens, all appliances in kitchen, etc.

Honestly, I'm just kicking ideas around. We do own a number of condos and a handful of homes. Looking at the bookings, some of these things seem to stay booked up for a large majority of the year. I saw a listing that showed revenues of $40k per year and thought it looked interesting.

Will I likely buy one, probably not (at least not any time soon).

You know this part of the Gulf. Those properties do stay occupied a goid part of the year. Cold here is great compared to the far north. I saw a lot of Ontario plates this year!