Vacation rentals

July 2nd, 2006 by Kenric

I’m here in Crested Butte in a townhome that my friends and I rented for 5 days. We’ve often thought about buying some real estate here as both a vacation home and an investment. Ski resorts are very popular vacation home investments for many people. But are they worth it?

I’ve done the numbers so many times and unless you’ve have purchased cheap, they almost always never make sense.

We are staying in a 4br 3.5ba townhome in Mt. Creste Butte. Our rate is $250 a night plus taxes. The townhome is very nice. Built in 1999, it is about 2400sf and has all the upgrades you’d expect to see like granite countertops, SS appliances, whirlpool tubs, steam shower.

In fact, it’s so nice I had to check and see what it would sell for, $1,100,000! I can tell you that at $250/night even with 100% occupancy this place is massively negative! Remember, management fee are usually close to 50% for vacation rentals. So figure $125/night X 30 nights, $3,750. That won’t even cover half of your mortgage! This is another case where renting makes senses. Rent a $1,100,000 townhome for $250/night!