The deal numbers
Figures as recorded in the client deal tracker. The return basis and reporting period require confirmation.
- Purchase price$880,000
- Down payment$88,000
- Closing costs$23,000
- Design and furnishing$134,156
- Total entry cost$245,156
- Recorded annual cash flow$52,139
- Recorded cash-on-cash20.79%
The tax position
- Purchase price$880,000
- Typical cost seg reclassification25% of price
- Illustrative year-one deduction$220,000
- Illustrative tax reduction at 40%$88,000
An illustration, not this client's return: 25% of price reclassified at a 40% marginal rate, the same assumptions as our calculator. Your number depends on your study, your rate, and meeting the seven day and material participation tests. We are not a CPA firm.
The full story
The Poconos are the clearest example of drive-market economics in the country. Roughly thirty million people live within a two-hour drive, and drive-to demand behaves very differently from fly-to demand: it books later, it books shorter, and critically, it holds up when airfare rises or discretionary travel budgets tighten.
Julie bought a five-bedroom in Pocono Lake at $880,000. The bedroom count targets the group that drives Poconos revenue, which is not couples but multi-family and friend-group weekends out of New York and Philadelphia, typically two or three nights, typically booked inside of three weeks.
The genuine advantage of the region is that it has four real seasons of demand. Summer lake and water sports, autumn foliage, winter ski traffic to Camelback and Blue Mountain, and spring shoulder. Compared with a single-season beach or mountain market, that produces a flatter annual revenue curve and a much less alarming set of winter statements.
It is also a market with real regulatory texture. Township and homeowner association rules across Monroe and Carbon counties vary considerably property to property, and a house that cannot legally operate is worth nothing as a short-term rental regardless of how well it shows. Verifying the specific permit position before an offer goes out is not optional here.
Questions about this deal
How much did Julie's Pocono Lake property cost?
A five-bedroom in Pocono Lake, Pennsylvania purchased for $880,000.
Why are the Poconos considered a strong drive market?
Roughly thirty million people live within a two-hour drive, largely from New York and Philadelphia. Drive-to demand books later and shorter than fly-to demand, and it holds up better when travel budgets tighten.
What is the main risk in the Poconos?
Regulation. Township and homeowner association rules in Monroe and Carbon counties vary property by property, so the specific permit position has to be verified before an offer is written.
Related
- Short-term rental market analysis for Pocono Lake
- Why two cabins on one road follow different rules
- Pennsylvania short-term rental regulations
- Lake house investing guide
- Pruthvi, Lake property in Poconos
- All client case studies
- The full deal tracker
- How the acquisition process works
- Financing a purchase like this
- The design and furnishing playbook
- The tax strategy behind these purchases