A Word on Short Term Rentals on Lake LBJ

A quick word of advice about AirBnB’s on Lake LBJ. Buyers are often looking for an investment they can buy, rent out as a short term rental, that will cover holding costs and even produce positive cash flow. What most people won’t tell you is that finding a rental that is cash flow positive these days on LBJ is nearly impossible. Why? Because values and associated holding costs are just too high and rental income, after management fees, vacancy loss, cleaning / make ready and increased wear and tear on the property just isn’t enough.

I am not saying that Short Term rental properties are a bad investment because I have personally owned various and own and operate one now. What I am saying is that buyers need to have a realistic expectation about owning a short term rental on Lake LBJ or they will be very disappointed with the results.

The biggest gains or income generation with Lake LBJ Real Estate will come through LONG TERM appreciation. Rental income allows a property owner to offset some of the holding costs, while being able to use the property on occasion for themselves, all while waiting for the property to increase in value. If done right there are also some tax deductions that can be valuable. The owner will likely have to put out some money each month or yearly to cover the difference but ideally it’s less than it would cost that owner if there was no income coming in at all. It’s important to understand that the prime, holiday weekends are going to be the days when income is the highest so the owner will probably want to forgo those big dates and instead be flexible and use the property on days that aren’t in such high demand. Cancelling family plans because a good, last minute rental came in is a decision my family has to make often.

Be aware that management fees are high and eat into profits so I personally choose to self manage my STR properties and recommend you do the same. This puts more money into my pocket and allows me more control over who is renting. Of course huge groups can divide the cost up and make your home super affordable but I personally choose to cater to smaller groups, willing to pay more for a luxury experience, to minimize wear and tear and liability on my property. Management companies won’t be so picky. One more thing to consider – the super rich typically don’t want to live next to a rental. So in the case of luxury real estate long term gains may be better found in areas that don’t allow rentals.

If you are considering a rental property at the lake please reach out. My team and I will guide you with experience and honesty so you can make an educated investment decision that will benefit your family for many generations to come.  We know Lake LBJ Real Estate!