The coastal cottage
October 5, 2026 · STR & LTR · USD
Fictional example assumptions. No inputs are independently verified. Scenario outcomes are not a purchase recommendation or a maximum possible loss.
Financial findings
Lowest modeled cash: $8,970. Your floor: $10,000.
The annual deficit is $12,410 after replacement funding. Revisit price, financing, income evidence and the operating budget.
Modeled shortfall: $25,141. Your limit: $15,000.
At least $1,541 additional cash is needed to avoid a negative modeled month-end balance. This excludes any extra cushion you want to maintain.
Lowest modeled cash: -$1,541. Your floor: $10,000.
First breach at month 3; lowest cash -$8,500. $18,500 additional starting cash would maintain your floor in this modeled sequence.
Annual cash flow after replacement funding is -$12,410. Conversion alone does not solve the deficit.
Base financial comparison
Follow the money · annual
| Annual breakdown | STR | LTR |
|---|---|---|
| Collected operating income | $77,350 | $28,500 |
| Revenue & night-based costs | $23,622 | $3,420 |
| Fixed operating expenses | $16,500 | $12,000 |
| Net operating income | $37,229 | $13,080 |
| Loan principal & interest | $21,890 | $21,890 |
| Replacement allocation | $3,600 | $3,600 |
| Cash flow after allocation | $11,738 | -$12,410 |
| Cash required at purchase (one time) | $153,750 | $131,750 |
| Cap rate (annual) | 9.9% | 3.5% |
| Cash-on-cash return (annual) | 7.6% | -9.4% |
Monthly averages are annual amounts divided by 12, not a month-by-month forecast. Acquisition cash includes down payment, closing, setup and reserves.
What does break-even require?
| Annual breakdown | STR | LTR |
|---|---|---|
| Paid-night occupancy | 53.1% | — |
| Monthly lease rent | — | $3,737 |
Covers operating costs, debt and replacement funding. Occupancy above 100% is unattainable with these inputs. No appreciation, tax benefits or sale proceeds are included.
Downside outcomes
| Annual breakdown | STR | LTR |
|---|---|---|
| Annual deficit/surplus after repair & replacement | -$13,141 | -$25,141 |
| Lowest modeled cash, including starting reserve | $8,970 | -$1,541 |
Connected STR-to-LTR fallback
Cash after 12 stressed STR months: $10,459. The transition uses $10,148, leaving $311 at LTR opening. After 12 base LTR months: -$8,500. Ongoing LTR cash flow after replacement funding: -$12,410/year.
Evidence readiness — separate from returns
7 of 7 research areas still need a reviewed quote/document and a source note. Statuses are your labels; this count does not validate a source.
Next action: Address-specific official source, jurisdiction, permit eligibility and transferability.
Next action: Current association documents and written lender confirmation of intended use.
Next action: Record comparable paid-night rates, available nights, occupancy definitions, seasonality, dates and property differences. Save a conservative range.
Next action: Record comparable achieved lease rents, concessions, owner-paid utilities, days to lease, dates and property differences. Ask a local manager for written support.
Next action: Rental-use quote, exclusions/deductible and purchase-specific tax estimate.
Next action: Inspection, repair/replacement quotes, management terms and utilities.
Next action: LTR demand and permission, transition costs and leasing-time evidence.
Unknown-input research queue
No missing numerical inputs in the selected evaluation. Numeric completeness is not evidence quality.
Your constraints & decision notes
Maximum acquisition cash budget: 160000 $
Available operating time: 8 hours/week
Minimum reserve floor: 10000 $
Maximum annual cash-flow deficit: 15000 $
Record whether to investigate further, revise assumptions, or pass—and why.
Time capacity is recorded, not scored. Confirm actual workload and management coverage separately.
Inputs used in this evaluation
| Input | Value |
|---|---|
| Purchase price | 375000 $ |
| Down payment | 25 % |
| Fixed interest rate | 6.75 % |
| Loan term | 30 years |
| Closing costs | 12000 $ |
| Starting cash reserve | 20000 $ |
| STR setup & launch | 28000 $ |
| Average nightly rate | 325 $ |
| Paid-night occupancy | 68 % |
| Available nights | 350 per year |
| STR platform fee | 3 % |
| STR Management fee | 20 % |
| STR Routine maintenance allowance | 2 % |
| STR cost per occupied night | 18 $ |
| STR Property tax | 5500 $/year |
| STR Rental insurance | 3600 $/year |
| STR Owner-paid utilities | 3600 $/year |
| STR HOA / association dues | 1800 $/year |
| STR permits & licenses | 600 $/year |
| STR Other annual operating costs | 1400 $/year |
| STR replacement funding | 3600 $/year |
| STR Previous combined fee allowance | 0 % |
| STR Previous combined fixed costs | 0 $/year |
| LTR setup & launch | 6000 $ |
| Monthly lease rent | 2500 $ |
| LTR income lost to vacancy | 5 % |
| LTR Management fee | 8 % |
| LTR Routine maintenance allowance | 4 % |
| LTR Property tax | 5500 $/year |
| LTR Rental insurance | 2200 $/year |
| LTR Owner-paid utilities | 1200 $/year |
| LTR HOA / association dues | 1800 $/year |
| LTR recurring leasing allowance | 900 $/year |
| LTR Other annual operating costs | 400 $/year |
| LTR replacement funding | 3600 $/year |
| LTR Previous combined fee allowance | 0 % |
| LTR Previous combined fixed costs | 0 $/year |
| Fixed & per-night cost increase | 10 % |
| One-time repair | 7500 $ |
| Repair month | 3 1–12 |
| STR nightly-rate decline | 10 % |
| STR occupied-night decline | 20 % |
| LTR rent decline | 8 % |
| Extra LTR lost rent | 1 months |
| Switch after stressed STR operation | 12 months |
| Conversion downtime | 2 months |
| One-time conversion costs | 4500 $ |
| Maximum acquisition cash budget | 160000 $ |
| Available operating time | 8 hours/week |
| Minimum reserve floor | 10000 $ |
| Maximum annual cash-flow deficit | 15000 $ |
Model boundaries
Pre-tax, fixed amortizing debt. No appreciation, tax benefits, sale proceeds, refinancing or probabilities. Month-end cash can miss intramonth shortfalls. STR seasonality is illustrative; LTR vacancy is smoothed. Planned replacement funding reduces distributable cash but stays in consolidated cash until spent. The connected fallback uses a stressed STR period followed by base LTR assumptions. These are not guaranteed loss limits.