Buying An Inn Question

[EmptyNest]

Hey everyone....I just got word that I now have two showings set up for this weekend (one on Saturday and one on Monday)! Of course, this happens on a HOLIDAY weekend where I'm sold out four nights in a row..

Yeah..and yes..that is a good thing. You can show them how well you are doing by being sold out!!! OF course, you will have to let your guests know someone may be looking in their rooms:-(

 

[EmptyNest]

Have you checked out financing through companies who specialize in B&Bs? Check out this article & their company.
Aspiring Innkeepers...It's a Great Time to Buy
As stated in another post, the type of financing happening these days are for inns that show profits. The numbers have to be there..

Yes some good information on that site. However, do you know someone who has a 40% down payment these days????...YIKES!

 

[Breakfast Diva]

Have you checked out financing through companies who specialize in B&Bs? Check out this article & their company.
Aspiring Innkeepers...It's a Great Time to Buy
As stated in another post, the type of financing happening these days are for inns that show profits. The numbers have to be there..

Yes some good information on that site. However, do you know someone who has a 40% down payment these days????...YIKES!
.

They have some creative ways to do financing, including 401K/IRA downpayment options.
To make a blanket statement that banks are not lending for bed and breakfasts is not accurate and I think a disservice to aspiring innkeepers. I think what has happened to B&B financing is the same thing that has happened in the general housing market. There were too many loans in the past that shouldn't have been approved.
The lender wants to make sure that the property is priced accurately, it shows income that can support the inn and that the prospective buyer has experience and education running a B&B.
The media is still reporting that it's difficult to get a mortgage even for personal houses. I was able to get a loan with no problem for a property (personal) we just bought. As long as you can prove your income, have great credit and the property you are buying is valued accurately there are loans out there.
I'm not endorsing this company, just putting it here for the wealth of information on their website Bed and Breakfast Financing

 

[swirt]

Have you checked out financing through companies who specialize in B&Bs? Check out this article & their company.
Aspiring Innkeepers...It's a Great Time to Buy
As stated in another post, the type of financing happening these days are for inns that show profits. The numbers have to be there..

Yes some good information on that site. However, do you know someone who has a 40% down payment these days????...YIKES!
.

They have some creative ways to do financing, including 401K/IRA downpayment options.
To make a blanket statement that banks are not lending for bed and breakfasts is not accurate and I think a disservice to aspiring innkeepers. I think what has happened to B&B financing is the same thing that has happened in the general housing market. There were too many loans in the past that shouldn't have been approved.
The lender wants to make sure that the property is priced accurately, it shows income that can support the inn and that the prospective buyer has experience and education running a B&B.
The media is still reporting that it's difficult to get a mortgage even for personal houses. I was able to get a loan with no problem for a property (personal) we just bought. As long as you can prove your income, have great credit and the property you are buying is valued accurately there are loans out there.
I'm not endorsing this company, just putting it here for the wealth of information on their website Bed and Breakfast Financing
.

Good find. I'll add this site to the resources section.

 

[EmptyNest]

Have you checked out financing through companies who specialize in B&Bs? Check out this article & their company.
Aspiring Innkeepers...It's a Great Time to Buy
As stated in another post, the type of financing happening these days are for inns that show profits. The numbers have to be there..

Yes some good information on that site. However, do you know someone who has a 40% down payment these days????...YIKES!
.

They have some creative ways to do financing, including 401K/IRA downpayment options.
To make a blanket statement that banks are not lending for bed and breakfasts is not accurate and I think a disservice to aspiring innkeepers. I think what has happened to B&B financing is the same thing that has happened in the general housing market. There were too many loans in the past that shouldn't have been approved.
The lender wants to make sure that the property is priced accurately, it shows income that can support the inn and that the prospective buyer has experience and education running a B&B.
The media is still reporting that it's difficult to get a mortgage even for personal houses. I was able to get a loan with no problem for a property (personal) we just bought. As long as you can prove your income, have great credit and the property you are buying is valued accurately there are loans out there.
I'm not endorsing this company, just putting it here for the wealth of information on their website Bed and Breakfast Financing
.

I was only stating what I was told. But I do agree with you, IF you have the down payment and can prove your income, credit rating etc. Then perhaps someone can get a loan. But getting all of those things together is a tall order these days. We often have aspirings come here with wide eyes and big dreams and then ask "how can I get it financed?" Which is totally unrealistic.

 

[Breakfast Diva]

Have you checked out financing through companies who specialize in B&Bs? Check out this article & their company.
Aspiring Innkeepers...It's a Great Time to Buy
As stated in another post, the type of financing happening these days are for inns that show profits. The numbers have to be there..

Yes some good information on that site. However, do you know someone who has a 40% down payment these days????...YIKES!
.

They have some creative ways to do financing, including 401K/IRA downpayment options.
To make a blanket statement that banks are not lending for bed and breakfasts is not accurate and I think a disservice to aspiring innkeepers. I think what has happened to B&B financing is the same thing that has happened in the general housing market. There were too many loans in the past that shouldn't have been approved.
The lender wants to make sure that the property is priced accurately, it shows income that can support the inn and that the prospective buyer has experience and education running a B&B.
The media is still reporting that it's difficult to get a mortgage even for personal houses. I was able to get a loan with no problem for a property (personal) we just bought. As long as you can prove your income, have great credit and the property you are buying is valued accurately there are loans out there.
I'm not endorsing this company, just putting it here for the wealth of information on their website Bed and Breakfast Financing
.

I was only stating what I was told. But I do agree with you, IF you have the down payment and can prove your income, credit rating etc. Then perhaps someone can get a loan. But getting all of those things together is a tall order these days. We often have aspirings come here with wide eyes and big dreams and then ask "how can I get it financed?" Which is totally unrealistic.
.

You're right, newly aspiring innkeepers have stars in their eyes and have no idea how much it takes to buy a B&B, whether it's a smaller less expensive one or one of the biggies. That is why aspirings need to take some seminars.
I had an aspiring innkeeper contact me a couple of days ago and she wants to take a seminar but can't right now because she's ready to give birth. Holy cow....what's she thinking??????

 

[Samster]

GG if you keep an eye on the inns for sale you would have seen a giant influx of of inns for sale in Maine in that price range. There is a reason..

GG if you keep an eye on the inns for sale you would have seen a giant influx of of inns for sale in Maine in that price range. There is a reason.

Yeah, I noticed there's a lot of Inn's for sale in Maine. What are thoughts about why so many are for sale in Maine??
.

We've been hard hit with the economy - like everywhere else - but most of us will be going into the winter without the usual meagre reserves that we normally do. To give you some idea, when we purchased Tipsy there were two other B&Bs on the market. They are still on the market today. Tipsy was priced well and sold. The others are now where Tipsy was but while they would have sold at that price back then, they are now STILL too expensive because of the shift in the economy and real estate prices. Just my opinion of course.
It's interesting that you're even considering a B&B. You - because of this forum - have a better idea than most of the reality of being an innkeeper
.

Tipsy, I appreciate your honesty! As a new innkeeper, we are not pulling out of the red as I hoped. If my dh, didn't have a full-time job it would not be good here. The other inns who have been in business for quite awhile are suffering too. And the brand new economy priced "suite hotels" here aren't helping. We are considering lowering our rates, but we know our price point with the discounts we offer.
Because our State budget has a shortfall, they have taken away our homestead exemption and our property taxes went up the maximum amount. They also hit me with a new assessment due to the business. Aspiring innkeepers need to know how a turnkey property might be affected by things like this!

 

[Samster]

Hey everyone....I just got word that I now have two showings set up for this weekend (one on Saturday and one on Monday)! Of course, this happens on a HOLIDAY weekend where I'm sold out four nights in a row..

Good luck!

 

[Proud Texan]

We came in under $250K for land, home and b&b.
Unless you're young and plan to be doing this for the rest of your life, AND you have a large number of rooms, I have a tough time seeing how it makes good business sense to spend 1 million + It seems like it would take you forever to get a return on the investment.
We're in it until we can't physically or mentally handle it anymore...probably 15 to 20 years.

 

[birdwatcher]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)...

 

[EmptyNest]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?

 

[Breakfast Diva]

We came in under $250K for land, home and b&b.
Unless you're young and plan to be doing this for the rest of your life, AND you have a large number of rooms, I have a tough time seeing how it makes good business sense to spend 1 million + It seems like it would take you forever to get a return on the investment.
We're in it until we can't physically or mentally handle it anymore...probably 15 to 20 years..

We came in under $250K for land, home and b&b.
Unless you're young and plan to be doing this for the rest of your life, AND you have a large number of rooms, I have a tough time seeing how it makes good business sense to spend 1 million + It seems like it would take you forever to get a return on the investment.
We're in it until we can't physically or mentally handle it anymore...probably 15 to 20 years.

I would definitely consider one of those million+ inns. Yes, it's big money, but they are also making big money! At least those that are making the business work. I think that a lot of people who are able to purchase those type inns are people who do a 1031 exchange. If you sell your business, unless you want to pay uncle Sam a huge amount, many people do a 1031 exchange to reinvest the capital gains.
I've considered it because when we sell our place, we'll owe the government over $100,000 in capital gains! I would be selling because I'm tired of the every day grunt work.
If instead, I reinvested the capital gains into another business such as a large B&B that was successful, had staff that could manage it if we wanted to get away, take a day off, etc then I would be able to not only stay in an industry I love, but also have the ability to not work as hard. Yes, managing staff is difficult, but certainly not the same level of physical exhaustion that comes with a busy smaller inn that you work yourselves.
Another way it's done is if you sell your house which is very expensive (that's not happening so much these days) such as was the norm for people in CA, then you had enough of a down payment to make the big expensive inn pencil out.

 

[SecondAct]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?

 

[bbinnsitters]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

VA is a big state - where exactly? Thx!

 

[EmptyNest]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?
.

Here is the listing. But...buyer beware..ask lots of questions. This inn just sold 6 months ago.

 

[EmptyNest]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

VA is a big state - where exactly? Thx!
.

Stanley. Here's their website.

 

[SecondAct]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?
.

Here is the listing. But...buyer beware..ask lots of questions. This inn just sold 6 months ago.
.

Thanks, saw this one before and then saw it come back on the market. Virginia is defniitely a big state and I'm more interested in the Eastern area, so that takes care of that.

 

[EmptyNest]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?
.

Here is the listing. But...buyer beware..ask lots of questions. This inn just sold 6 months ago.
.

Thanks, saw this one before and then saw it come back on the market. Virginia is defniitely a big state and I'm more interested in the Eastern area, so that takes care of that.
.

Here's one on the Eastern SHore, the price has been reduced DRASTICALLY.

 

[SecondAct]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?
.

Here is the listing. But...buyer beware..ask lots of questions. This inn just sold 6 months ago.
.

Thanks, saw this one before and then saw it come back on the market. Virginia is defniitely a big state and I'm more interested in the Eastern area, so that takes care of that.
.

Here's one on the Eastern SHore, the price has been reduced DRASTICALLY.
.

Been monitoring this one too. Considering a visit. It's listed at a different price on Innshopper though so not sure which is accurate.

 

[EmptyNest]

Yes I had stars in my eyes...but you know what? If all of us knew then what we know now SOME OF US WOULD NOT HAVE taken the plunge into the field of work we are in and then there would be many many talented and great people owning and or running fabulous B & B's that would not be doing it today...I firmly believe that Innkeeping is a calling.
Sometimes you can find small B & B's that are an actual residential loan instead of a business loan (expenses)....

I know of a "lease to purchase" one that went on the market this week....if you have a $100K deposit..... Anyone interested in VA?
.

Yes, I'm interested in VA. Can you email me off the forum?
.

Here is the listing. But...buyer beware..ask lots of questions. This inn just sold 6 months ago.
.

Thanks, saw this one before and then saw it come back on the market. Virginia is defniitely a big state and I'm more interested in the Eastern area, so that takes care of that.
.

Here's one on the Eastern SHore, the price has been reduced DRASTICALLY.
.

Been monitoring this one too. Considering a visit. It's listed at a different price on Innshopper though so not sure which is accurate.
.

The one with the VA B & B realtor is the last update price. You should go see it. They put a ton of work into it but unfortunately the partners split up.
We love going there, but we usually go off season. Things are very quiet then. You do realize it is a pretty seasonal place???? Unless you do wedding, special events, and things to draw people out there, it is real quiet during the winter months.