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evaluating a $700k mountain property?

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  • evaluating a $700k mountain property?

    So an interesting off-market opportunity has surfaced near me.
    12 acres, log cabin, out in the mountains, 30 mins from major airport and metro area. Very 'rural', no cell service, slow internet, etc.
    Basically, there's 3 parcels side-by-side, one with a nicely finished 3br log cabin, the 2nd with an unfinished cabin that's been sitting empty for a decade, and the 3rd lot with a horse barn and foundation/framing that could be cleaned/converted into another dwelling.

    I'm thinking of buying this and the seller is firm on their $700k asking price. I'm thinking I can use this as a family vacation spot as well as AirBnB type property.

    Curious if anyone else here has gone through a similar process? Any tips? Any advice for evaluating if it really is a good idea to 'invest' in this rather than stock market or a more conventional duplex type property in town?

  • #2
    $700k for dirt does not sound like a good investment. If you want to buy it that’s fine, but don’t count on making any money.

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    • #3
      I’m no expert here but I did look into buying a rural piece of property for my family’s use and to AirBnB on occasion, but when looking into insuring it for short term rental use, it was not insurable under an STR policy bc of being too far from a fire station. I realize AirBnB says they insure their rentals to a degree, and I’m probably one who plays it a little safer than most, but just make sure you look into all of this before counting on that income to offset costs

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      • #4
        How strong is the airbnb market there? We always rent places on vacation but no cell and slow internet would be a no go for me. We bought a cabin recently and use it often but having phone/ internet access is important for working from there and for my son to be able to play online with friends while there. We'd have a much harder time convincing him to go otherwise! But others might feel differently. I just think 700k is a lot and you'd probably be better off investing in the market or a more traditional duplex or something. But without knowing local conditions, really hard to say.

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        • #5
          700k is a chunk of change. be careful

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          • #6
            Originally posted by Helpingmydad View Post
            no cell service, slow internet, etc.
            im out.

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            • #7
              We have some very rural property and just found out about an internet service called Starlink. It's Elon Musk of Tesla fame who started this venture. Its directed at rural under served spots that need high speed internet. There are a bunch of satellites and hundreds more are on the way so service will continually get better. I bought the package but have not yet received it so I can't comment on how good it is, but its suppose to be near as good as cable modem speeds. Its around $100 a month. You could go to their website and see if the spot your looking at is eligible for service.
              Last edited by K82; 03-08-2021, 05:14 PM.

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              • #8
                I cannot tell you if it's a good deal, if you can afford it, or if you should buy it.

                In my mountainous area, poor cell reception isn't a deal breaker for short term rental, but bad internet is tough on land value and rentability, especially now that work from home is proliferating. I'd want to know why this piece of land is so valuable over a bunch of other 12 acre tracts.

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                • #9
                  Originally posted by Peds View Post

                  im out.
                  The cohort of people who rent out Airbnb's generally want internet. But the more landlords the better the pricing for users. So yes. Try it out.

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                  • #10
                    I am impressed you found a super rural place without internet 30 minutes from a major airport.

                    I would rent a place like this and not care about internet and phone for a week or two. But I am odd and that would scare most people.

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                    • #11
                      Starlink from elon for internet. Wifi calling for cell.

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                      • #12
                        Whenever I hear Star link it makes me think of Skynet. But I hope it offers the competition that is needed to drive down cable prices. I would even be willing to tolerate a robot insurrection or two.

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                        • #13
                          Originally posted by Lordosis View Post
                          I am impressed you found a super rural place without internet 30 minutes from a major airport.

                          I would rent a place like this and not care about internet and phone for a week or two. But I am odd and that would scare most people.
                          Yeah I can't picture a rural area within 30 minutes of major airport. OP consider paying a realtor to value the property and ability to do what you are considering. In my opinion it would be rare to get a really good "off market opportunity" unless its a family property.

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                          • #14
                            Originally posted by Lordosis View Post
                            I am impressed you found a super rural place without internet 30 minutes from a major airport.

                            I would rent a place like this and not care about internet and phone for a week or two. But I am odd and that would scare most people.
                            The good news is that OP found a potential renter for a week or two.
                            For $750k, you need a business plan for this investment.
                            https://www.calculator.net/payback-p...alculator.html

                            That is $62.5k per acre. The only attractive feature (from an investment view) is the “major airport” proximity. Land deals make money from development or growth. As is, this is a dud. You won’t make money with one rental unit.

                            This is reminds me of city folk businessmen that want to buy a ranch. They sell only to the next one that values “going to the ranch next weekend”. All hat, no cattle.

                            If you have the wealth to own a place in the mountains, that is fine. Consumption, not investment.

                            ”Any advice for evaluating if it really is a good idea to 'invest' in this rather than stock market or a more conventional duplex type property in town?”
                            These are two options. $750k rental property portfolio will take a lot of work for passive investment in duplexes. Stocks are easier.
                            What does your IPS say?


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                            • #15
                              1. No cell service in cabin can be solved by wi-fi calling but you need a good internet for that.

                              2. 95 %+ of the people need internet pretty much every day. You cannot be a viable AirBnb depending on the 5% who want absolute peace and solitude.

                              3. Fire service.

                              4. Roads and ambulance and healthcare. Not everyone is young and fit and even those people can injured or fall sick. So you need good access to emergency medical care.

                              5. How about utilities. Good electricity? Water quality any good? I suspect it is septic tank, or for the more adventurous, out in the woods.

                              6. Something tells me that this will be difficult to unload should you find out it is not viable or not to your liking. Are you ready to lose 700K.if it comes to that?

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