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Is everybody in debt?

116,055 Views | 681 Replies | Last: 3 mo ago by Captain Winky
TXTransplant
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I typically will look at Airbnb as part of my planning process. The problem right now is the nightly rates might be low, but when you go to secure dates and check out, sometimes the price increases by as much as 20-30% due to all the taxes and fees.

Owners have A LOT of discretion when it comes to what sorts of fees they tack on to the bill. Between the fees and taxes, I've seen $2000 rental quotes increase to $3000.

Also, Airbnb tends to have a much more strict cancellation policy. Many are non-refundable or only 50% refundable after 48 hours of booking.

Hotels have gone this route, too, when it comes to their cheapest rates, but you can usually still get a refundable room at a higher price. Some hotels have also gotten on the fee bandwagon (in addition to the "resort" fees that most of them were already charging before covid).

I will qualify this by saying, I don't ever look at shared stays on Airbnb. I exclusively rent condos/houses where I have the place to myself.

The number of scams associated with these bookings is also increasing. I posted on the travel board about rental car companies being sleazy. The two most prevalent complaints on the travel consumer advocate blog that I follow are for rental car companies and Airbnb/VRBO.
Lavender Gooms
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Yep, the fees on Airbnb can be crazy. We were looking at a place to have a couple of families do a winter vacation at. The place said sleeps up to 10 or 12 I think. Except they added something like $50/person/night for anything over 4 guests! So even though the advertised nightly rate was good, the total cost was probably 50% more.
mwp02ag
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We operate two 1/1 STR apartments near the Pearl Brewery in SA, don't get me started on the ****ing HOT taxes. I can't speak for other areas but SA is a mess and in my opinion the city does not want STRs or at least does everything they can to limit them.

We have a guest here right now for 5 nights leaving Sunday morning. Our base weekday rate is $85 and weekend is $105. We are not the highest in the area but one of them which we prefer as it helps keep clientele more respectable in our experience, we are a quite property despite the location one block off the N St Mary's strip. This stay breaks down like this:

  • $91 x 5 nights for $456
  • $80 cleaning fee, which all goes to our cleaning company
  • $76 service fee, $16 goes to the platform and the rest goes to the State of Texas for HOT taxes
  • $58 Property Use fee we added to cover the SA and Bexar Co HOT taxes, all goes straight to them
  • $669.29 total for 5 nights about $134/night

$108 bucks in HOT taxes and SA won't let the platform collect and remit them so we have to do all the calculations and submit the payments.

We go walk at the Pearl and Riverwalk and blow our minds how many people, especially younger people spending $15 on a drink and $30 on a meal while wearing designer clothes, shoes, bags etc. Our goal is to BE rich, not LOOK rich.
TXTransplant
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It's good to know what all the fees are for. Yours seem reasonable. I've seen cleaning and service fees both $300+. It's gotten crazy since covid.

As a side note, we decided to go to Phoenix/Grand Canyon/Sedona for spring break. It was about the only ticket that was <$400. I found a great Airbnb in Sedona for about 1/2 the price of a hotel. Bonus is it's 2 beds, so my sister and her husband will have the option to join us. The hotel selection there isn't great, and the "nice" looking ones were pushing $400/night.
redag06
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Airbnb also tacks on an additional fee that isn't shown at checkout. Ours was approximately another 8%.

Crazy
Dill-Ag13
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Neighbor across the street is 37, married to 36 y/o. Both Mexican (he heritage but born here, her born in Mexico), went to med school in Mexico and have school loans. She stays at home with the kids and he works at a hospital as a clinical researcher ($90k/yr?) but calls himself a doctor. They rent their house. Two kids 6 and 3. They have a 2016 platinum expedition and a 2017 Audi A4 base. They bought both used and financed em. They want to buy a house but go on 2-3 vacations a year. They have no assets and a boat load of debt.
Dill-Ag13
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Neighbor next door works at Baker, is an engineering tech. Wife works at a preschool but no kids. Both in late 30s/early 40s. They have rented their house for 11 years and "should've bought" but haven't yet. He has a car payment. I do not get the white collar income types that do not actively work to build wealth.
Petrino1
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TXTransplant said:

I typically will look at Airbnb as part of my planning process. The problem right now is the nightly rates might be low, but when you go to secure dates and check out, sometimes the price increases by as much as 20-30% due to all the taxes and fees.

Owners have A LOT of discretion when it comes to what sorts of fees they tack on to the bill. Between the fees and taxes, I've seen $2000 rental quotes increase to $3000.

Also, Airbnb tends to have a much more strict cancellation policy. Many are non-refundable or only 50% refundable after 48 hours of booking.

Hotels have gone this route, too, when it comes to their cheapest rates, but you can usually still get a refundable room at a higher price. Some hotels have also gotten on the fee bandwagon (in addition to the "resort" fees that most of them were already charging before covid).

I will qualify this by saying, I don't ever look at shared stays on Airbnb. I exclusively rent condos/houses where I have the place to myself.

The number of scams associated with these bookings is also increasing. I posted on the travel board about rental car companies being sleazy. The two most prevalent complaints on the travel consumer advocate blog that I follow are for rental car companies and Airbnb/VRBO.



Even with the air bnb fees I've never seen them be as high as hotel prices. I've stayed at air bnbs in London, Miami, Puerto Rico, Rio De Janeiro, Panama all for the fraction of a cost of what the hotels in the ares were going for.
TXTransplant
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I think Airbnb prices overseas are a lot more competitive than the US.

We stayed in one in Rome because for the space, amenities, and location no hotel (not hostel - I'm too old for those) could come close to the price.

We also used one in NYC for similar reasons, but NYC basically outlawed short term rentals because they were driving up the cost of long term housing. Owners get big fines if they are caught doing STRs.

Anchorage is another US city where the Airbnb choices are just a lot better than the hotel selection.

We also stayed in one very close to Volcanoes National Park on the Big Island. Great price, beautiful house, and that's a location where there really aren't very many hotels to even choose from.

In the US, it really depends on the location and time of year. Which, unless I have a specific hotel in mind where I want to stay, I will always at least check Airbnb.

I do find, though, that looking for an Airbnb is much more time consuming than finding a hotel. I will usually spend a few hours looking through all the listings in an area. But I am a consumer who looks at ALL the pictures and reads ALL of the reviews. Then you also have to sort through the details, like the cancellation policy and extra fees. I'm a lot pickier when it comes to booking an Airbnb, so it takes more time.
double aught
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One thing that drives me crazy with Airbnb/vrbo is that they almost always have an overpriced cleaning fee in addition to a long list of things that the renter needs to have clean upon leaving.
htxag09
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I'd say Airbnbs are typically more than hotels in the vast majority of American cities if only looking at one room. If booking two rooms, multiple families are going, etc, then yeah, Airbnb typically is cheaper.
Diggity
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The cleaning fee is nearly always a cash grab. I usually see fees that are 2-3x the actual cost of cleaning.
jja79
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I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.
YouBet
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jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?
jja79
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Yes.
YouBet
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jja79 said:

Yes.


WTH does he do for a living?
$30,000 Millionaire
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YouBet said:

jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?


Don't be shocked. I have seen it happen.
You don’t trade for money, you trade for freedom.
YouBet
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$30,000 Millionaire said:

YouBet said:

jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?


Don't be shocked. I have seen it happen.


I think I'm more shocked at how someone that young makes that kind of salary. That is c suite money.
techno-ag
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$30,000 Millionaire said:

YouBet said:

jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?


Don't be shocked. I have seen it happen.
He needs to do a Dave Ramsey snowball and knock out that debt.

It's not how much you make, it's how much you save.
$30,000 Millionaire
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I made that in my mid 30s. More common than you think.
You don’t trade for money, you trade for freedom.
FamousAgg
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Pssshhh… I made more than $50k a year I'm my 30s what's the big deal
$30,000 Millionaire
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In most industries, the C suite and the CEO in particular is absolutely ripping off management employees.

Some companies like Google do a much better job with management comp.
You don’t trade for money, you trade for freedom.
$30,000 Millionaire
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techno-ag said:

$30,000 Millionaire said:

YouBet said:

jja79 said:

I talked to a 30 something year old Friday that is straight salary. $50,000/month but couldn't qualify him for a mortgage because his debt to income ratio is too high and he doesn't have any money for a down payment.


$600k a year?


Don't be shocked. I have seen it happen.
He needs to do a Dave Ramsey snowball and knock out that debt.

It's not how much you make, it's how much you save.


I hear this a lot and that's just not true. A teacher can save 100% of their income their entire career and probably have less than $1.5M in principal. They won't crush it unless they learn to invest
You don’t trade for money, you trade for freedom.
htxag09
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$30,000 Millionaire said:

I made that in my mid 30s. More common than you think.

Seeing as like $590k puts you in the top 1% of earners nationally, doubt it's that common for a 35 year old to be making $600k. Unheard of? Absolutely not. But definitely not common.

But, this is Texags, where $600k may put you in the top 50%
YouBet
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htxag09 said:

$30,000 Millionaire said:

I made that in my mid 30s. More common than you think.

Seeing as like $590k puts you in the top 1% of earners nationally, doubt it's that common for a 35 year old to be making $600k. Unheard of? Absolutely not. But definitely not common.

But, this is Texags, where $600k may put you in the top 50%


The only 30 something person I've known in real life to make close to that is dermatologist friend of mine (and I'm guessing on her salary).

Hell, I'm almost 50 and I don't know anyone personally that gets paid salary that high other than that doctor and the top couple of people at my wife's company.
$30,000 Millionaire
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Here you go.
You don’t trade for money, you trade for freedom.
YouBet
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Rich.

$30,000 Millionaire
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Ok, I'm taking that down now. Please do the same
You don’t trade for money, you trade for freedom.
htxag09
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lol. thats great for you, not sure why you get the need to post that to prove it. Again, nobody said it's impossible or unheard of. It's not common.
$30,000 Millionaire
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Thank you
You don’t trade for money, you trade for freedom.
AggiEE
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Dill-Ag13 said:

Neighbor next door works at Baker, is an engineering tech. Wife works at a preschool but no kids. Both in late 30s/early 40s. They have rented their house for 11 years and "should've bought" but haven't yet. He has a car payment. I do not get the white collar income types that do not actively work to build wealth.

Why do you assume that home ownership and not having a car payment are pre-requisites for building wealth?

Now, they may have other issues in their situation. But I have been building wealth by NOT owning a home and anytime I buy a car I finance it at extremely cheap rates (generally making more in the stock market throughout these periods than the financing cost).
Dill-Ag13
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Yeah maybe my story was out of context but I know enough about his situation from getting to know him that they do not actively work to build wealth in any way.
Ghost of Bisbee
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AggiEE said:

Dill-Ag13 said:

Neighbor next door works at Baker, is an engineering tech. Wife works at a preschool but no kids. Both in late 30s/early 40s. They have rented their house for 11 years and "should've bought" but haven't yet. He has a car payment. I do not get the white collar income types that do not actively work to build wealth.

Why do you assume that home ownership and not having a car payment are pre-requisites for building wealth?

Now, they may have other issues in their situation. But I have been building wealth by NOT owning a home and anytime I buy a car I finance it at extremely cheap rates (generally making more in the stock market throughout these periods than the financing cost).


Same here. I'd like to buy a home soon but it's completely impractical right now with inflated prices and mortgage rates where they are right now
topher06
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Biglaw attorneys make $500k+ in their thirties. Dated a doctor who made a little under a million a year for a bit, early 30s. Think it's completely reasonable that people in their 30s make mid six figures
YouBet
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topher06 said:

Biglaw attorneys make $500k+ in their thirties. Dated a doctor who made a little under a million a year for a bit, early 30s. Think it's completely reasonable that people in their 30s make mid six figures
It's reasonable for certain jobs, of course. It's just not common.
 
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