We Finished Our First Single Family Short Term Rental Property!

We bought a house in our neighborhood last year, with the intent to turn it into a short term rental. Long term the idea would be to sell the property to one of our children so that they would be able to live in the same neighborhood they grew up in.  We purchased our home for $148,000 in 2011. In 2023 and 2024 several 2 bedroom and 3 bedroom houses in our neighborhood were selling for over $250,000.   We were able to purchase this 3 bedroom property for $96,000, which felt like a steal at the time.

The Property:

This property is 1,000 feet from our home and sits on just over an acre with 2 decent sized pole barns. The house is a 3/1 with an attached 2 car garage and an unfinished workspace between the house and the garage.  The house has a full basement and has a well and septic tank with natural gas for heating. It borders MDOT land that leads down to Pipestone Creek. It looks pretty good on the outside, however it needed considerable work.

The Rehab

We did not expect this property to take so long, but we had several complications.  Not only was there far more work than I originally anticipated, but we also purchased the 7 unit building at the same time, which has required a ton of work to stabilize.  I also had larger demands than normal from my W2 job over the last year.

Typically we work on whatever project will lead to the quickest turnaround on cash flow. This is why we ended up flipping 3 of the units (and did a lot of work on the other units) in our 7 unit building ahead of finishing this property.

We purchased the property on September 13th of 2024 and got it listed on AirBnb on August 21st of 2025.  We spent $46,000 on the rehab and roughly $10,000 on carrying costs for the period.  We spent an additional $6,200 in closing costs when we got a loan on the property, putting our all in cost at $158,200.

Trash Removal:

We separated out everything burnable and everything that could go back to the scrap yard. We did several loads of burnable items to our oldest kid’s house, and several truckloads of scrap metal to recycle. We ended up ordering 2 dumpsters for a total dumpster cost of $760.  We got a price break on the 2nd dumpster because we had it loaded and ready to pick up the same day.

Drywall Work:

In what was the Kid’s bedroom the ceiling had fallen in.  This was really bad.  There were 3 layers of ceiling in this room, the original place plaster ceiling, a professionally installed drywall ceiling under that, then an OSB ceiling under that.  A portion of this had fallen in due to a roof leak.  The more I pulled back, the more I realized the whole thing needed to come down. I unfortunately lost all my pictures from 2024 so I do not have any pictures..

This was relatively easy for the first 2 layers of ceiling, but was exceedingly difficult for the final layer. This layer not only was plaster, but had a wire mesh built into it. It turned out that this wire mesh was an infrared heating system.  I had to decommission the old heating system for this room. This was also a pain due to blown insulation.   I installed new drywall in the ceiling and it turned out pretty good.  You can still see where the seams are, but it isn’t super obvious.

The next bedroom had a similar issue but I only had to replace the area of 1 sheet of drywall rather than the whole ceiling.

All of the walls were textured walls that had several imperfections.  We decided rather than leaving them how there were to texture over them.  This was a new skill for me to learn. I sprayed the walls with mud then let them dry a bit, then spread the mud with a large putty knife to make the knockdown texture.  This turned out well and I’m glad I did this over trying to replace the drywall. This was extremely labor intensive and took a long time.

Roof Replacement:

We hired out the roof replacement. We spend $13,185 having the old roof tore off and the new roof installed. Although this was not a steep roof and had a simple design, I was much happier to hire this out than to do myself.

Painting: 

Everything needed primed and painted.  I hired some of this out to a family member.  Since the ceilings are popcorn ceilings I needed to spray them rather than roll them.  A fresh coat of paint on the ceilings makes a big difference.

Ceiling Fans and ACs:

Central air is expensive and was not in our initial budget. I replaced all the ceiling fans in the house. I found out that Menards makes an “easy install” ceiling fan line.  These are WAY easier to install than normal ceiling fans. I highly recommend these. We spent roughly $700 on ceiling fans.  Unfortunately all the windows are installed to slide sideways, which makes installing normal window ACs not practical.  We bought 2 large floor AC units that exhaust through a strip attached to the window.

Cabinets:

We got a stupid good deal on cabinets. Lowes was clearancing out their assemble yourself cabinets and they were half off…BUT they also had an additional 75% off manager special going on, so we ended up getting all the cabinets for under $250.

Termites:

When we pulled up the carpet in the living room to dispose of we found we had termites that had caused substantial damage. We paid $1,500 for an exterminator to deal with them.  After they were all gone I repaired the damage they had done by replacing several pieces of subflooring.

Bathroom:

We hired out the tub install for $1,300. In addition to this we installed a drop ceiling to make the ceiling level, replaced the sink and the toilet, replaced the subfloor, and installed new flooring. Pretty much a whole new bathroom.

Siding:

We hired out the siding as well.  We had them install the new siding over the old and it turned out really good.  The guys also replaced one of our windows for us. The previous siding was terrible and the windows were replaced at some point after the siding was and they were not done well. The new siding fixed this issue. He have new blue vinyl siding which looks a million times better than the brown siding that was originally on the house.

Flooring:

We installed linoleum in the kitchen, then had Lowes install carpet through the whole house. Originally we were going to get LVP installed, however the floors aren’t perfectly level and it would have cost almost 3 times as much to have the floors leveled and LVP installed. We paid $6,000 to have the carpet installed. Two guys installed carpet in all 3 bedrooms, the hallway, and the living room in under 3 hours, it was impressive! We paid extra for the pet friendly carpet and padding.  We could have got cheaper carpet and paid about half this amount.

Kitchen:

We already discussed the cabinets and the flooring.  In the kitchen we also installed new counter tops. We did Butcherblock countertops that we stained and sealed. We installed a new fridge, stove, and dishwasher.

Other Appliances:

We bought a new washer and dryer and a new water heater. With well water it is very common to get a bad smell from the sacrificial anode reacting with the water.  We were getting this so I removed the anode and replaced it with a powered anode that cost around $100, this took care of the smell after about 24 hours.  I spent $420 on the water heater and then another  $212 on all the pieces/parts to hook it up.  I ended up having to replace half the plumbing in the house and had to make 4 trips to Lowes.

Gutters:

A big problem this house had was water in the basement.  When we bought it there was probably 20 gallons of water on the basement floor. The sump pump would also kick on several times a day.  I cleaned out the gutters on the back side of the house and installed gutters on the front of the house. In addition to this I improved the grading on the backside of the house.  I spent roughly $500 on gutters.

Soffit/Fascia:

I painted all of the soffits and fascia black. This took forever, but looks so much better. I also painted the garage door black.

Trim and Vent covers:

I hate trim. I am not very good at it, it takes me forever, doesn’t look great, and costs a bunch of money. I need to find someone to hire trim work out to going forward.  We spent around $700 on trim. We also replaced all the vent covers in the house, costing another $200. We installed 10 year sealed smoke detectors throughout the house.

Staging:

A big part of Airbnb’s is furniture:

We purchased and staged 2 Queen beds, 1 bunk bed, 2 couches, 4 TVs, 1 adjustable desk, towels, bedding, cleaning supplies, dressers, tables, book shelves…It all adds up.  We spent around $6,000 on all of this stuff. We bought the dining room table and the coffee table from a moving sale and a couple nice chairs from a thrift store.

Extras:

We set up an arcade in the space between the garage and the house.  I had a Legends Ultimate arcade machine that had been collecting dust at our house that I got on clearance a few years back. I had a Foosball table I bought on clearance for the 6 unit building that didn’t fit, and a Pacman arcade game that I repaired.  We purchased a used arcade 1up pacman game for $100 and an Air Hockey table for $40. Inside the house I wanted a plug and play video game system and bought both the SNES Mini Classic and the Atgames Sega Genesis Mini.  What I love about the Atgames one is that in addition to the built in games it also plays the original Sega Genesis cartridges

Pole Barns and Outside:

We got the pole barns empty, but then…We started to fill them.  Long term I want to make the pole barns a destination attraction for Airbnb by adding something super cool inside them.  For now we are using them for storage. I bought $2,000 of clearance shelving from JoAnns when they shut down and Mrs. C. bought $1,000 worth of Billy Bookcases for our home that are also stored there currently.

Getting The House Ready:

At the end of a project it seems like 100 different little things pop up to bite you. Aside from the normal furniture assembly we found all sorts of overlooked odds and ends to attend to. Curtain installations, paint touch ups, welcome mats, light switch replacements, door locks, etc. We spent roughly a week chasing down all the remaining odds and ends.

I love how the butcher block counters turned out, I also installed a piece vertically to hide the side of the dishwasher.

The Numbers:

We have sunk roughly $60,000 of cash into the rehab of this property.  We have a 30 year fixed rate loan for $95,200 on the home, which has a payment of $625/mo. Adding in roughly $200/mo for taxes and insurance and $300/mo for misc. utilities, our base cost is $1,125/mo. From a labor aspect I did not track our hours, but a LOT, several hundred hours of labor went into this project. I hate that I lost all the before pictures. I am still hopeful that I might be able to recover them.

If we can maintain 70% occupancy at $140/night average, then the property will gross $3,000 per month providing positive cash flow of almost $2,000 per month.

In the future if rates drop back to a 4.5% level then we would likely refinance.  Rather than taking cash out or getting a lower payment I would be more likely to switch to a 15 year mortgage.  If this occurred 2 years into the mortgage the new loan would be for $93,150 at 4.5% for 15 years and carry a monthly payment of $712/mo, $87 more than the original payment.  Total interest paid for the life of this loan would be $35,116 vs $116,984 if we kept it at a 30 year.

After listing the property our first three bookings have set us up to earn just under $3,000 of gross revenue in the first month.

On to the next one!

What do you think of this house?