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franksin
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Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 7:37 am

I am thinking of buying a condo in Whislter, for both personal use and as a vacation rental. I 'm trying to figure out how much vacancy to budget for if I am managing it as a vacation rental for furnished multiday or weekly rental. I am looking for input or suggestions from anyone who owns rentals in Whistler.
 
MultipleOffer
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 9:06 am

be prepared for a 39% management fee

many vacation rental properties that are on the market are already vacation rental properties. a good way to get an idea of vacancy rates are is to find out which management company they are with (or VRBO) and there will be a calendar showing which dates are booked. Also rates are variable.

make sure you get a good handle on the 30 different types of zoning up there and which ones do allow nightly rentals. Also note that you will have to register for HST, charge HST to your visitors and may even have to pay HST on the unit you purchase.

Also rates are variable depending on the time of year. You can earn as much in 1 week during christmas as you can earn all summer!

Here is a proforma that i did on a property that i was looking at:


# of days Rate Gross

3 $1,375.00 $4,125.00 current bookings
14 $700.00 $9,800.00
28 $850.00 $23,800.00
12 $475.00 $5,700.00
7 $359.00 $2,513.00
14 $550.00 $7,700.00 projected bookings
6 $1,250.00 $7,500.00
4 $1,375.00 $5,500.00

Total $66,638.00 39% $25,988.82 mgmt
 
leftside
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 11:45 am

There are also a lot of other fees. Once you take these into consideration, you'll be lucky to break even.
IT Equipment costs
Cable
Credit card expenses
utilities
Guest supplies
Tourism Whistler fees
Strata fees
Franchise fees
Reservation fees
Travel Agent commissions
 
northyvr
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 12:35 pm

We own a townhouse up there and manage it ourselves for short term rentals. Even without having to pay the 40% management fees, we're still out of pocket. We don't view Whistler as an investment, it's a lifestyle choice. Even if you're making decent rental income, be prepared to deal with ongoing maintenance, tenant issues (last ones almost caught the place on fire), etc. It can be a real pain and most definitely not much of a money maker. Good thing we love it up there and to us, the sacrifices are worth it.
 
franksin
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 1:21 pm

It is a lifestyle decision for us and partly a longterm investment idea (mortgage payoff). I know that there is a lot to consider and I do not yet understand the zoning. Though I would like to break even and be able to write off my travel up there to 'manage' it and board.

Multiple Offer. It the 39% based on the building/hotel handling bookings, housekeeping and key handoff to the renters? What was the value of the property for that proforma, if you dont mind me asking.

northyvr, Do you meet your vacation renters to hand off keys and such. I am in Vancouver and would have to find some management company to do this for me and to do housekeeping. My concern is that it would be a hard market to find these kind of services if it is not managed my the complex.

Thanks all
 
northyvr
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 2:42 pm

Franskin, we have an electronic lock for the front door. The codes are added/deleted by us when we're up there (at least once per month). The tenants are emailed their door code upon balance of payment. Easy. They can let themselves in without needing a key.

We have a cleaning service, whom we schedule ourselves. We live on the North Shore (obviously, with my username), so in case of emergency, we can be up at Whistler within an hour and a half if necessary. Our cleaners are also an emergency contact.

If you're planning on using this place quiet a bit yourself, make sure you stay away from hotel-based properties (phase 2), where you're only allowed 28 days winter and 28 days in summer. We were adamant about buying a phase 1 property (unrestricted).
 
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Lady Luck
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Re: Buying Whislter condo as Vacation Rental

Tue Feb 07, 2012 8:01 pm

I am thinking of buying a condo in Whislter, for both personal use and as a vacation rental. I 'm trying to figure out how much vacancy to budget for if I am managing it as a vacation rental for furnished multiday or weekly rental. I am looking for input or suggestions from anyone who owns rentals in Whistler.
Why not call a local property manager and ask these questions. There are lots of people with the same idea right now. Does this indicate a market bottom?

Agree that phase 1 is the way to go and location is everything.
 
franksin
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Re: Buying Whislter condo as Vacation Rental

Wed Feb 08, 2012 8:17 am

Thanks LL. Very straightforward , and I will call a some up.
Any Realtor recommendations?
 
MultipleOffer
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Re: Buying Whislter condo as Vacation Rental

Wed Feb 08, 2012 11:56 am

$1.1m was the pricepoint. This particular property was previously sold for $1.85m a few years back, so there is some fairly deep discounting going on up there atm. Maybe LL is right about a bottom. This years snow helps a lot i'm sure and whistler could rise with the tide of a global recovery.

Here is the rest of that proforma with $300k down and a $1m purchase price.

Projected Revenue: $66,638.00

Less $25,988.82 mgmt
12 x $410.91 $4,930.92 maint
$8,000.00 prop tax
$36,000.00 mortgage

$(8,281.74) cash flow position

+ $14,000.00 principal paid on mtg

$ 5,718.26 Net Income before taxes
 
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Lady Luck
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Re: Buying Whislter condo as Vacation Rental

Wed Feb 08, 2012 12:14 pm

Hot off the press. Whistler's destination guest visits has increased by 31% so far this season over last year. Yes snow is a big factor but given the international interest I am wondering if we are seeing some Olympic spin off. (finally) (hopefully)
 
ReductiMat
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Re: Buying Whislter condo as Vacation Rental

Wed Feb 08, 2012 7:16 pm

I imagine a factor in hotel bookings this year had to do with the lack of snow in Europe and the Eastern USA resorts:

http://www.theweatherclub.org.uk/news/a ... -snow-joke
 
curious
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Re: Buying Whislter condo as Vacation Rental

Thu Feb 09, 2012 7:43 am

$ 5,718.26 Net Income before taxes
You earn only 1,9% on your $300K cash invested.

Wouldn't you be in trouble when interest on your $700K mortgage rises?
(If interest rate rises for only 1%, you will get a negative net income.)
 
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Lady Luck
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Re: Buying Whislter condo as Vacation Rental

Thu Feb 09, 2012 12:10 pm

I think he is looking at this for personal use when not rented. Basically using others to pay for his vacation home. So the lifestyle return is much greater then the hard numbers.
 
gse36
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Re: Buying Whislter condo as Vacation Rental

Thu Feb 09, 2012 1:02 pm

if you don't mind the sun and beaches, and want a vacation home, try hawaii.
1000sq ft. across waikiki beach. 2 bedroom. with parking. ocean view. about $1M.
rents $300-400/night depending on season. it doesn't have the low occupancy that whistler suffers from (since hawaii is a more visited destination).

management fee not nearly as bad since you can hire a local there to do your renting out and hire for cleaning (a lot of VRBO actually charge for cleaning anyway).

the #'s aren't as bad as the whistler property. of course its further away. but then again. its hawaii.
 
VanLord
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Re: Buying Whislter condo as Vacation Rental

Wed Feb 15, 2012 8:33 pm

Hey Frank you can read my posts in this old thread to find out about the property types and some of the tools to manage the property yourself.

I would be careful listening to advice on here, as much of the info in this thread is partially or mostly incorrect info.

http://www.realestatetalks.com/viewtopi ... =8&t=33855

Lady Luck is right, go talk to an agent in Whistler, you can find out all of the info you will need to make an informed decision.

HST is a consideration, as most properties have deferred GST which has implications on your personal use, and does mean you will have to collect and file an HST return.

Buying a vacation rental in Whistler pretty much means buying a small business (a money losing small business) I really love having a condo in Whistler, but if I were you, I would think long and hard about how much you want to deal with running a business out of your vacation rental.

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