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What does the future hold for STRs?

4,216 Views | 43 Replies | Last: 1 yr ago by mwp02ag
Jay@AgsReward.com
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Interesting article about STR in Phoenix for the super bowl:

https://www.nytimes.com/2023/02/09/realestate/phoenix-rentals-airbnb-super-bowl.html
Yesterday
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Jay@AgsReward.com said:

Interesting article about STR in Phoenix for the super bowl:

https://www.nytimes.com/2023/02/09/realestate/phoenix-rentals-airbnb-super-bowl.html


Can you post a snippet for those without a sub? Thanks Jay.
Jay@AgsReward.com
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Sure. The gist of the article is that a lot of folks got greedy in their pricing and are left with empty houses this week. And Phoenix no real regulation on STR and they are likely over supply.

Quote:

But despite two of the world's largest sporting events descending on greater Phoenix on the same weekend, at the height of the season for both snowbirds and sightseers, most short-term rental sites are barely breaking 50 percent occupancy. Frustrated homeowners are being forced to slash prices, and some small investors are beginning to think they made a bad bet.

About two years ago, Karen Ochoa and her husband, who live 400 miles away in Thousand Oaks, Calif., spent $645,000 on a four-bedroom, two-bath investment property in Phoenix and then did a $100,000 renovation, adding a heated pool, firepit and putting green. Ms. Ochoa began renting it out for passive income, and also launched a side business serving as a co-host for other local owners, helping them furnish and design their own rental properties. She listed the house for $1,200 a night during Super Bowl weekend. There are no takers.
Quote:

Los Angeles's short-term rental market is significantly less competitive than that of Phoenix. A 2019 law made it illegal to rent out any property other than your primary residence in Los Angeles, effectively shutting investors out of the market.
Though Arizona homeowners need to obtain a license to operate a vacation rental, there are fewer restrictions making the market a free-for-all and ripe for investors, big and small.
Investors like Ms. Ochoa snapped up more than 30 percent of Phoenix's housing stock in the third quarter of 2022. She will still make money during the Super Bowl she owns a second property, a five-bedroom, three-bath house that she bought for $670,000 and has been able to rent it for $2,500 per night that weekend. One company alone, the Dallas-based Invitation Homes, now owns more than 8,700 homes in Phoenix.
Casago, a vacation rental company headquartered in Scottsdale, has added about 3,000 new listings in just the last two months, said Ryan Dame, Casago's co-owner.
htxag09
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We put our house up for Airbnb when the Super Bowl was in Houston.

From that experience I'd say it's a combo of things. Mainly, I don't think the demand is truly as high as people expect. A lot of people going to the Super Bowl are guests and their experience includes the hotel. My aunt was invited once and it was a whole ordeal. Literally every time they left the hotel and returned their was a new Super Bowl gift.

We ended up not renting our home out because every single request we got was sketchy as hell and obviously just a Super Bowl party.
Diggity
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Jay@AgsReward.com said:

About two years ago, Karen Ochoa and her husband, who live 400 miles away in Thousand Oaks, Calif., spent $645,000 on a four-bedroom, two-bath investment property in Phoenix and then did a $100,000 renovation, adding a heated pool, firepit and putting green. Ms. Ochoa began renting it out for passive income, and also launched a side business serving as a co-host for other local owners, helping them furnish and design their own rental properties. She listed the house for $1,200 a night during Super Bowl weekend. There are no takers.
this is shocking news!
Keeper of The Spirits
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Our rental company is Port A is taking measures to support the local community. They have a private security force, they are building housing for their seasonal employees, and they contribute almost 2% of rents to the local foundation used to supplement the living expenses of educators. It the state would ditch the Robin Hood bull**** the locals would have no issue with this
ChoppinDs40
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Who do you use? My uncles place's property mgmt company is trash. They now charge $350 to clean his place!
Ornithopter
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STR are super problematic in small towns. They can overwhelm the local housing supply to where nobody local can ever afford to purchase one. Small communities also don't have the construction base (and in mountain towns the topography) to rapidly build up new housing at an affordable price point.

Not hard to imagine why people would vote against outsiders making their living situation untenable.
mwp02ag
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I'd like to see the platforms only support owner operators and not allow arbitragers and large PM groups. That seems like it would fix a lot of problems. Of course I don't think that will solve the problems in a place like Port A or Breck where you have massive demand for vacation homes for rent and few hotels/resorts. Port A baffles me, all that open land with beach front and no resorts.

Is that a Port A government thing?
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