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Stowe Vermont Real Estate Market Investment Advice

StoweVT.com is about superior investment advice on real estate in Stowe and the surrounding areas of Northern Vermont.  We pride ourselves on being the best real estate investment advisors in Vermont.  Really, we pride ourselves on making our clients money.  There is nothing worse than buying real estate without a plan and then suffering the consequences when you sell for a loss on your investment.  Whether its flipping properties, finding an undervalued house or being the winning bid on a trophy property, our goal is to offer our clients the clearest investment picture possible.  A great example of this was helping a wonderful family find a home in Stowe that allowed them to realize their dream of having a future retirement home in Stowe that would rent well as their second home.  Please click here for more information on 402 Cottage Club Rd in Stowe, VT.


After a focused property search it came down to two properties.  Based on the attributes of both buildings we offered the following advice to our clients.  Below is a recap of that narrative.


In the mean time, I wanted to offer my take/projections on the rental prospects of both properties.  These come with the caveat that they are projections and cannot be relied on - they are the best estimate we have with the information available to us.  My assumption is that both will be marketed via VRBO, etc. for short term rentals.  Further, your families use of the property would take away from the revenue potential in these assumptions.

356 Week Hill: This assumes you add a hot tub and make the study into an room that sleeps guests.


$44,000 - Rental Revenue (80 rental nights at $550 per night)


$10,200 - association dues annually

$10,108 - real estate taxes annually

$  2,000 - insurance

$  3,000 - heating (waiting for actual usage)

$  1,500 - electric ($125 per month)

$   2,500- cleaning

$     900 - rental ads

$  3,000 - cable TV

$     500 - hot tub service

$     450 - firewood (2 cords)

$34,158 - Total Exp


$9,842 - Net Operating Income


This is around a 2% return on investment - i.e. you would have to be contributing financially to cover the mortgage.


This is about standard for the market - kind of a break even prospect annually.  What hurt is the association fees.  If those drop to $4,000 per year if the town takes over maintenance of the road then this will start to approach a 3% return on your investment.


402 Cottage Club:


$84,000 - Rental Rev (105 nights at $800)


$14,643 - Real Estate Taxes (this will come down once the property is subdivided)

$  5,700 - heating (1,900 gallons (use last 12 months, at $3 per gallon)

$  2,200 - electric (assumes $180 per month average)

$  3,000 - insurance

$  4,000 - cleaning

$  1,500 - snow removal

$  2,000 - lawn care

$     900 - rental ads

$  2,400 - cable TV

$     500 - hot tub service

$     900 - firewood

$37,743 - Total Exp


$46,257 Net Operating Income - So say $45,000 per year.

That is about a 6% return on your investment (assume $750,000 purchase price), more than enough to cover a mortgage.


As you can see, this is a far better rental in my assessment from an return on investment perspective.


This lines up with what I am hearing from an owner we consulted.  He has two investment properties in Stowe - one with 5 bedroom and one with 6 - who is considering buying another.  He said "I can't stay in my house because it is rented all the time".  From what I am told the two were rented every week for the entire summer.


In the end this analysis proved conservative and the investment is performing far better than anything the owner expected.  It actually is performing so well that the owners are again looking for another investment property in Stowe, VT.  Nothing makes clients happier than exceeding expectations.  If you are looking for clear investment advice, that is what Stowevt.com prides itself on as the definitive real estate source in Stowe and the surrounding areas of Northern VT.


Please feel free to reach out anytime to discuss your property sale or purchase (nick@stowevt.com or 802.585.1131).  Let us help you make the right choice!



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