BiggerPockets Real Estate Podcast Episode: 3 Cash-Flowing Real Estate Deals in 2025 (& Where We Found Them) Release Date: May 26, 2025

In the latest episode of the BiggerPockets Real Estate Podcast, Ashley Kerr takes the reins from host Dave Meyer to delve into three distinct real estate deals presented by Garrett Brown, a short-term rental expert and host of the newly launched Bigger Stays YouTube channel. This episode, titled "3 Cash-Flowing Real Estate Deals in 2025 (& Where We Found Them)," offers listeners a comprehensive analysis of each property from multiple rental perspectives, providing invaluable insights for both novice and seasoned investors.

Introduction

Ashley Kerr opens the episode with a warm welcome, emphasizing the abundance of profitable real estate investments available in the current market. She sets the stage for an engaging discussion by introducing Garrett Brown, who brings three distinct property deals from different locations and price points. The primary focus is on evaluating each property as both a short-term and long-term rental, highlighting the strategic considerations necessary to maximize returns.

Deal 1: Fredericksburg, Texas

Property Overview:

• Location: Fredericksburg, Texas
• Type: Single-family home
• Size: 1,800 sq. ft.
• Price: $449,000
• Features: 3 bedrooms, 2 bathrooms

Short-Term Rental Analysis:

Garrett Brown presents the Fredericksburg property as a high-performing short-term rental market, especially appealing due to its proximity to Austin and its burgeoning local attractions like wineries. He states, “This city rings bells with anybody within Texas of a travel destination here” (Garrett Brown, 01:29).

• Projected Revenue:
  • Baseline: $74,000 annually (Garrett Brown, 03:15)
  • Potential with Enhancements: Up to $120,000 annually by adding amenities such as a hot tub and improving the backyard (Garrett Brown, 04:10)
• Occupancy and ADR:
  • Occupancy Rate: 46% (AirDNA baseline)
  • Average Daily Rate (ADR): $437

Long-Term Rental Analysis:

When analyzing the property as a long-term rental, the numbers reveal a less favorable outcome.

• Estimated Monthly Rent: $2,490
• Monthly Expenses:
  • Mortgage (20% down, 30-year fixed at 6.63%): $2,200
  • Taxes: $378
  • Insurance: $150
• Total Monthly Costs: ~$2,800
• Conclusion: The property does not pencil out as a long-term rental, yielding a thumbs down for this strategy (Ashley Kerr, 08:55).

Key Insights:

Garrett emphasizes the critical role of amenities in boosting short-term rental revenue. He notes, “The secret sauce for short term rentals is it's the purchase price. … and how you can get up to that 100,000, 120,000 gross revenue per year is the amenities that you add and then being able to get your average daily rate and your occupancy goals up” (Garrett Brown, 03:50).

Deal 2: Wheeler, Oregon

Property Overview:

• Location: Wheeler, Oregon
• Type: Single-family home
• Size: 1,300 sq. ft.
• Price: $339,000
• Features: 3 bedrooms, 2 bathrooms, ocean and mountain views

Short-Term Rental Analysis:

Garrett introduces Wheeler, Oregon, highlighting its natural beauty and tourism appeal. The property boasts immaculate views, making it an attractive short-term rental option.

• Projected Revenue: $65,000 annually
• Occupancy Rate: 55%
• ADR: $330
• Cash on Cash Projection: ~4% (baseline)

He explains the potential for increasing returns by enhancing property amenities and possibly adding a tiny home or ADU (Garrett Brown, 14:30).

Long-Term Rental Analysis:

Using BiggerPockets’ rent estimator, Ashley assesses the property as a long-term rental:

• Median Monthly Rent: $1,100
• Mortgage and Expenses: ~$2,000 monthly
• Conclusion: The long-term rental does not financially support the property, resulting in a monthly deficit of approximately $900 (Ashley Kerr, 15:10).

Mid-Term Rental Opportunity:

Garrett pivots to explore the mid-term rental market, considering Wheeler’s proximity to natural attractions which attract professionals and academics seeking furnished accommodations.

• Potential Monthly Cash Flow: $3,000 - $4,000
• Strategic Consideration: Diversifying rental strategies to include mid-term rentals can mitigate risks and enhance cash flow (Garrett Brown, 18:00).

Key Insights:

The discussion underscores the importance of flexibility in rental strategies. Garrett advises new investors to analyze properties from multiple rental perspectives to ensure adaptability in changing market conditions.

Deal 3: Waco, Texas

Property Overview:

• Location: Waco, Texas
• Type: Single-family home
• Size: 1,400 sq. ft.
• Price: $275,000
• Features: 3 bedrooms, 2 bathrooms, furnished

Short-Term Rental Analysis:

Waco, driven by the influence of Chip and Joanna Gaines, has emerged as a vibrant short-term rental market. Garrett highlights the property's strategic location near major metro hubs and Baylor University.

• Projected Revenue: $42,000 (baseline) vs. neighborhood comps of $52,000 - $65,000
• Occupancy Rate: 52%
• ADR: $220
• Cash on Cash Projection: Negative 15%
• Furnishing Advantage: The property is already furnished, reducing upfront costs significantly (Garrett Brown, 22:55).

Long-Term Rental Analysis:

Ashley uses the rent estimator to evaluate the property's long-term rental potential:

• Median Monthly Rent: $1,600
• Monthly Expenses: ~$2,100
• Conclusion: Similar to previous deals, long-term rental does not support financial viability, leading to a monthly deficit (Ashley Kerr, 28:00).

Mid-Term Rental and Co-Living Opportunity:

Given Waco’s proximity to Baylor University and the bustling local economy, Garrett considers mid-term rental and co-living strategies as viable alternatives.

• Potential Monthly Cash Flow: $3,000 - $4,000
• Additional Strategies:
  • Dividing the lot to sell a portion and offset costs.
  • Combining short-term and long-term rental strategies for diversified income streams (Garrett Brown, 29:30).

Key Insights:

Garrett emphasizes the significance of understanding local market regulations and leveraging existing property features, such as furnishings, to enhance rental attractiveness and financial performance.

Operational Strategies and Investment Advice

Throughout the episode, both Ashley Kerr and Garrett Brown provide strategic advice for real estate investors:

1. Importance of Amenities:

   • Enhancing property amenities can significantly boost short-term rental revenue. Simple additions like hot tubs or improved outdoor spaces can elevate a property's appeal and justify higher ADRs (Ashley Kerr, 04:10).

2. Diversifying Rental Strategies:

   • Investors, especially those new to the market, should consider multiple rental strategies (short-term, mid-term, long-term) to maximize returns and mitigate risks. This flexibility is crucial for adapting to market fluctuations and tenant demands (Garrett Brown, 06:12).

3. Negotiation Tips:

   • Properties lingering on the market for extended periods may offer negotiation opportunities. Engaging with experienced agents and making strategic offers can secure better purchase prices or seller credits, enhancing cash flow potential (Garrett Brown, 30:07).

4. Data-Driven Decision Making:

   • Relying on data sources like AirDNA and BiggerPockets’ rent estimator ensures investment decisions are grounded in accurate market analysis rather than emotions. Analyzing comparables and understanding local market dynamics are essential for making informed decisions (Ashley Kerr, 05:28).

Conclusion and Final Takeaways

The episode concludes with a recap of the three deals, emphasizing the importance of comprehensive analysis and strategic planning in real estate investing. Ashley and Garrett reiterate that while some properties may not initially seem viable under certain rental strategies, creative approaches and thorough market research can uncover profitable opportunities.

Final Thoughts:

• Stick to the Numbers: Avoid emotional attachments to properties by relying on solid financial analysis (Ashley Kerr, 31:37).
• Be Adaptable: Flexibility in rental strategies can unlock hidden potential within properties (Garrett Brown, 22:57).
• Leverage Expertise: Working with knowledgeable agents and utilizing expert tools can enhance investment outcomes (Garrett Brown, 30:18).

Garrett and Ashley invite listeners to engage further by visiting the Real Estate Rookie Channel and Garrett’s Bigger Stays YouTube channel for more in-depth analyses and real estate insights.

Notable Quotes:

• Garrett Brown (03:50): “The secret sauce for short term rentals is it's the purchase price… and how you can get up to that 100,000, 120,000 gross revenue per year is the amenities that you add and then being able to get your average daily rate and your occupancy goals up.”

• Ashley Kerr (04:10): “That's one of the highest performing short term rental markets in the country… it's a great market for you.”

• Garrett Brown (05:28): “…make sure that it can also possibly work as a long term rental or even a midterm rental because you want a few different exit strategies.”

• Ashley Kerr (06:12): “You're looking at all perspectives and make sure there are comps that can support what you're planning on trying to do.”

• Garrett Brown (30:07): “There's nothing wrong with working with a good agent… list prices are just a suggestion.”

• Ashley Kerr (31:37): “Sometimes you'll be way more emotional with a property when it performs really well and cash flows great than if you just liked it when you walked through for the showing.”

This episode serves as a valuable resource for real estate investors seeking to navigate the complexities of property investments in diverse markets. By dissecting real-world deals and offering practical advice, BiggerPockets continues to empower its audience towards achieving financial freedom through savvy real estate investing.