Buying a property / cabin / cottage for 90% AirBNB. Anyone done it? | GTAMotorcycle.com

Buying a property / cabin / cottage for 90% AirBNB. Anyone done it?

PrivatePilot

PrivatePilot

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Curious if there's any AirBNB owners here. I'm not talking "I rent my cottage once or twice a year on airbnb", I'm talking "I bought a cabin in the woods (or whatever) solely to rent out as an investment property".

I've been dabbling with it. Partly to break up the monotony of life right now. Partly as an actual property for our own use when it's not rented. Partly as an investment of course.

Looking around on AirBNB the "unique" stays (anything from yurts to RV's to "Tiny homes" that are virtually glorified sheds...and all sorts of things in between) are almost constantly booked, have amazing reviews, and yield a surprising amount of money on a per night basis.

Yes, I know that many AirBNB's are not booked every night.
Yes, I know there's risks, insurance hurdles, financing/mortgage hurdles, etc. I'm in a situation where those can be dealt with easily.
Yes, I know that one needs to be financially able to carry the property should there be zero rentals. I'm OK with that and can easily do that with whatever we'd buy.

Discuss.
 
have been a regular airbnb user on the guest side of the relationship for years
doesn't give me a whole lot of insight to being an owner I guess

the owners that I have dealt with have been overwhelmingly positive about the transaction
the fact that they can see your prior reviews and have a one on one dialogue before accepting the booking is good

just as a guess, I'd think you should be looking at covering your costs at a 50% occupancy rate
will get a bad booking every now and then, damage, a mess, but there are mechanisms to recoup some of that cost

I'd also plan on tossing all the furniture and a complete redecorating if you do this for a few years then decide it's just for you later
 
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How long will it take for the AirBnB market to recover?
If memory serves me well, back in April the condo market got flooded with available units as many had to conver their short term rentals to long term - granted, you are looking at property away from the city.

www.livabl.com

Furnished apartments flood Toronto rental market as Airbnb regulations tighten | Livabl

It's a clear indication that many former short-term rentals that once occupied Airbnb and similar platforms are quickly migrating to the long-term rental market.
www.livabl.com

Plus - isnt there some new tax coming with respect to this?

www.bdo.ca

Tax Considerations for Airbnb Hosts

There are many problems that may occur after a deal closes, and there are three accounting issues to watch out for.
www.bdo.ca www.bdo.ca

Sounds like you are in solid financial health regardless - so as long as you are aware and planning for 2022+ then it shouldnt be too much of an issue I suppose..
 
Subscribed. My daughter and her SO have a really nice year round place just outside of Algonquin park that they have just recently started to rent out on AirBNB. Personally doesn't interest me.Don't want strangers sleeping in my bed or pooping in my toilets.
 
POWERMAN said:
How long will it take for the AirBnB market to recover?
If memory serves me well, back in April the condo market got flooded with available units as many had to conver their short term rentals to long term.
Click to expand...

Regular accommodations on AirBNB are empty right now....the same as most hotels and such, no question. Why would anyone pay $150/night for a plain-jane AirBNB when hotels are cutting rates to get the business now and can be had for less.

But vacation properties, especially unique stays...well, they're booked solid. And have been for months. And the popular ones are booked all winter. People can't go on a traditional vacation so they're looking for experiences.

Even after Covid I don't expect that to change, either - the "experience" thing has always been a strong category on AirBNB.

My wife and I just booked a rather unique one that we've had on our watch list for months now. It's been constantly full. We were hoping to catch a cancellation or something, but it never happened, and the history of reviews indicates people are indeed constantly there. We finally just booked for March which was the soonest availability.

Wingboy said:
Subscribed. My daughter and her SO have a really nice year round place just outside of Algonquin park that they have just recently started to rent out on AirBNB. Personally doesn't interest me.Don't want strangers sleeping in my bed or pooping in my toilets.
Click to expand...

Meh, that doesn't bother me - ever stayed in a hotel? Used a public bathroom? Same thing.

Yes, there's wear and tear to think about, no question, but that can be budgeted into things.
 
Neighbours have a cottage up in the Parry Sound area (or thereabouts) and rent it out literally every weekend from March-November. They said they've never been as busy as this year, and they indicated that they post it on AirBNB. They've had it for a few years, and only go up when it's not booked. This year...maybe 2 weekends all year.

Cottages and properties outside of the city are going gangbusters and a few of my RE friends have all said the same thing....people are going nuts and paying stupid money for cottages as they can't leave the country on vacation, so may as well stay here.

Personally, and only from what I hear/see in my little world, if you have a good/clean place in a good area then you will always have it rented out with no issues of looking for tenants. Plus remember it's December now, many people will want to WFH all year, and they may rent long term so they get out of the city. I know I am planning on doing so at our place in Wasaga.

If I had the cottage, and not my parents, I would put it up on AirBNB and let it just make me money.
 
My family owns lakefront properly near Cloyne. I've spoken to my dad previously about renting it out since between all of us (dad/sister/me/aunt/cousin) we're there maybe 8 weekends a year. He's game but my aunt is the freakin gestapo when it comes to leaving stuff out of place; forget to put a tool back in the shed? Next time you come up there's a 3 page letter waiting for you on why stuff belongs in it's place and every phone call for the next 3 months turns into a reminder..sheesh.

My future plan is to certainly airBnB style it, we already own it outright so at this point the money would just pay for the upkeep and pad the accounts a bit. The icing on the cake is there's a separate smaller guest 'house', so technically you could still go up, keep to yourself and rent the cottage to whoever, or visa versa.

Good luck!
 
PrivatePilot said:
Curious if there's any AirBNB owners here. I'm not talking "I rent my cottage once or twice a year on airbnb", I'm talking "I bought a cabin in the woods (or whatever) solely to rent out as an investment property".

I've been dabbling with it. Partly to break up the monotony of life right now. Partly as an actual property for our own use when it's not rented. Partly as an investment of course.

Looking around on AirBNB the "unique" stays (anything from yurts to RV's to "Tiny homes" that are virtually glorified sheds...and all sorts of things in between) are almost constantly booked, have amazing reviews, and yield a surprising amount of money on a per night basis.

Yes, I know that many AirBNB's are not booked every night.
Yes, I know there's risks, insurance hurdles, financing/mortgage hurdles, etc. I'm in a situation where those can be dealt with easily.
Yes, I know that one needs to be financially able to carry the property should there be zero rentals. I'm OK with that and can easily do that with whatever we'd buy.

Discuss.
Click to expand...
I could sell you the worlds smallest :cautious: water access only camp site,
the taxes would be horrendous, it's almost nothing but waterfront and you would need to zone it commercial.
 
or you could buy one of the water access only plots on Horseshoe Lake
and if you talk nice to me I might even let you ride motorcycles across the backlands to get to it.
 
Evoex said:
My family owns lakefront properly near Cloyne. I've spoken to my dad previously about renting it out since between all of us (dad/sister/me/aunt/cousin) we're there maybe 8 weekends a year. He's game but my aunt is the freakin gestapo when it comes to leaving stuff out of place; forget to put a tool back in the shed? Next time you come up there's a 3 page letter waiting for you on why stuff belongs in it's place and every phone call for the next 3 months turns into a reminder..sheesh.

My future plan is to certainly airBnB style it, we already own it outright so at this point the money would just pay for the upkeep and pad the accounts a bit. The icing on the cake is there's a separate smaller guest 'house', so technically you could still go up, keep to yourself and rent the cottage to whoever, or visa versa.

Good luck!
Click to expand...
This is similar for us. Tried to get parents to rent it as it's not really being used 80% of the year. But...mom loses her mind if things are out of place, or she wants the renters to ensure that things are back the way they were and I just told her it doesn't work like that. Honestly, a 5min drive to the main strip and a walk to another beach...I'm sure they'd have it rented all summer. However...that means it won't be the 'perfect' renter and most likely will require cleaning, which to me is anticipated and expected (within reason).
 
I'd like to open a campground but a campground is a huge amount of work, so unless it is backwoods camping it ain't happening.
*you are going to be responsible for water quality if you provide it.
 
Trials said:
I'd like to open a campground but a campground is a huge amount of work, so unless it is backwoods camping it ain't happening.
*you are going to be responsible for water quality if you provide it.
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Acquaintance of ours had a camp site near Barry's Bay for years. Bought it with buddies and eventually bought them all out. Huge money maker for him. Had trouble selling it, until he sold it and as the buyer didn't have the funds he did a vendor takeback mortgage. So not only did he sell it, he gets recurring income every month for 30 years with interest. Massive amount of work to keep the place going, and the new owners have really built the place up nicely, way better than he had it.

We always rent a place there, even with new ownership, and love going as it's a beautiful area and summers are beautiful.
 
You need an attraction. Cabin in the woods isn't going to cut it unless people want to go there for a reason.
 
one of the issues with those campgrounds is the cash business
they are a great enterprise for keeping a portion of your earnings away from CRA

but then your books don't show the real value
how to you explain to a buyer, especially one that needs financing
that your business is actually worth x-times what the books say?

mimico, ever get over to Wilno?
 
J_F said:
one of the issues with those campgrounds is the cash business
they are a great enterprise for keeping a portion of your earnings away from CRA

but then your books don't show the real value
how to you explain to a buyer, especially one that needs financing
that your business is actually worth x-times what the books say?

mimico, ever get over to Wilno?
Click to expand...
LoL that was actually the problem....primarily cash business, and the buyer couldn't get financing because it was (let's say) 50% cash business. Worked out for our friend as he holds the mortgage on the property.

As for Wilno...yes. Very often. We'd go there every year during the huge Polish Scout event that ran for 2 weeks. The middle weekend was so booked you basically book it the year prior as you leave wherever you rent from. Lots of good times were had there. Stopped going when I went out to BC as it would never line up. But nothing but good memories of that area. You can tell the old Polak houses by the curtains lol.
 
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Above board always works in the long run.
 
I spent last summer in that area
had never seen Tyskie before, or eaten so much sausage!

great people though, hard working and very friendly

capo.jpeg
 
J_F said:
I spent last summer in that area
had never seen Tyskie before, or eaten so much sausage!

great people though, hard working and very friendly

View attachment 46161
Click to expand...
We always stop at that church. You want to see a huge amount of Polaks go during the scout weeks. So much fun.

I’ve got Tysie in the fridge now, and some Lech and Zywiec ready for the weekend. Highly recommend!

was hoping to go for a cruise out that way with the WRX as the roads are great before the snow hits...but I may have missed that opportunity this year.
 
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J_F said:
one of the issues with those campgrounds is the cash business
they are a great enterprise for keeping a portion of your earnings away from CRA

but then your books don't show the real value
how to you explain to a buyer, especially one that needs financing
that your business is actually worth x-times what the books say?

mimico, ever get over to Wilno?
Click to expand...
Hahaha, a paintball place was for sale last summer. Owner said books showed minimal incoming money (say 50K), owner wanted many millions for the place because it was so profitable. I couldnt believe they actually put that in the ad. Could they try any harder to get a CRA flag planted in them?
 
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