Your Cost Seg Study Told You What You Save. Now Check What You Earn.
The deduction is a one-time acceleration. Revenue compounds every year you own the property — and underperformance is quiet. A guest piece from our revenue-management referral partner on the other half of the STR buy decision.
The deduction is a one-time acceleration. Revenue compounds every year you own the property — and underperformance is quiet. A guest piece from our revenue-management referral partner on the other half of the STR buy decision.
If you just ran a cost segregation study, you know a number most property owners never learn: what the tax code hands back in year one. It is usually a big number, and it deserves the attention it gets.
I want to point you at the number nobody hands you.
I run a revenue management firm for short-term rentals. My job is the other half of the equation your study just solved. The study answers what the asset gives back at tax time. My question is what it earns in its market, every year, for as long as you own it.
Here is why that order matters. The deduction is a one-time acceleration. You pull tomorrow’s depreciation into today, once. Revenue compounds the other way. A property earning $15,000 under its market does that every year, quietly, and no refund covers it twice.
And underperformance is quiet. It does not look like failure. It looks like decent occupancy, a rate that has not moved in four months, and a monthly report that arrives late and explains nothing. The owner is rarely doing anything wrong. The listing is simply sitting in the wrong position against the ten properties that come up beside it, priced by a tool nobody is watching or a manager stretched across a hundred doors.
The test is simple. Do you know, right now, where your property ranks in its comp set, and what the gap between your revenue and the market’s best comparable is worth in dollars per year? If you know both numbers, you are ahead of almost everyone. If you don’t, that is the audit.
Mine is free. It shows you the comp set, your position in it, and the gap in dollars. If the gap is small, I will tell you that too, and you should change nothing. For what the work produces when the gap is real: across 19 documented engagements between 2019 and 2026, the median result was a 45% revenue lift net of market, which means the market’s own movement is stripped out of the number. It is a median, so half did better and some did less, and every property is audited before a target is set.
One more thing, because you are reading this on a tax site. If you used the STR strategy, your material participation hours are already pushing you closer to the operation. Good. The owners who track their revenue position with the same discipline they track their hours are the ones who end up with properties that perform on both schedules, the IRS’s and the market’s.
You did the smart thing on the tax half. Spend ten minutes on the revenue half before the season turns.
Jason Baxter is the founder of Marketics, a short-term rental revenue management firm. He was recently quoted by CNBC on Airbnb host economics. Marketics and Cost Seg Smart are referral partners.
