Why Killing Bad Deals Is the Most Important Part of My Job
Most people assume my value as a short-term rental–focused Realtor® in Nashville comes from finding great STR deals.
That’s only partially true.
The real value I provide — especially in today’s market — is killing bad deals before they ever make it to the closing table.
In the post-2020 rush, short-term rental investing rewarded enthusiasm. Deals worked even when underwriting was sloppy, assumptions were aggressive, and long-term risks were ignored. That era is over.
In 2026, saying yes is easy.
Saying no is the skill.
I reject far more Nashville STR opportunities than I approve. That discipline isn’t hesitation — it’s experience. And for investors considering short-term rentals in Nashville, that filter matters more than deal volume ever could.
For a full breakdown of how STR zoning, underwriting, and deal selection work in this market, our complete Nashville Short-Term Rental Guide lives here: Short-Term Rental Guide.
The Difference Between “Looks Good” and “Actually Works”
Nearly every STR deal I review looks good at first glance.
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Optimistic AirDNA projections
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Strong peak-season revenue comps
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Attractive photos and marketing
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A sense of urgency baked into the pitch
But STR success is not driven by marketing. It’s driven by math, structure, regulation, and survivability.
The question I ask on every deal is simple:
Does this property still work when something goes wrong?
If the answer is no, the deal stops there.
1. Deals That Only Work in a Best-Case Scenario
This is the most common reason I say no.
If a Nashville STR only pencils when:
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ADRs outperform historical averages
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Occupancy stays elevated year-round
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Expenses remain flat
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Competition doesn’t increase
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Regulations stay static
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Management execution is flawless
It isn’t an investment. It’s a fragile model.
Professional underwriting assumes friction:
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Softer shoulder seasons
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Rising operating costs
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Increased local competition
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At least one underperforming year
If a deal breaks under conservative assumptions, it doesn’t move forward. Upside is optional. Downside protection is not.
2. “NOO” in Name, but Risky in Reality
Not all non-owner-occupied (NOO) STRs carry the same risk profile.
I routinely reject deals involving:
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Weak or ambiguous HOA language
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Buildings where enforcement depends on the current board
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Developments marketed as “STR-friendly” without airtight documentation
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Condo regimes where investors lack voting control
If STR legality depends on interpretation, sentiment, or lack of enforcement — I’m out.
This is why zoning clarity and enforceable eligibility are foundational to any Nashville STR investment strategy. We break this down in detail inside the Short-Term Rental Guide here: Short-Term Rental Guide.
The best STR assets are boring from a legal standpoint — and that clarity compounds returns.
3. Deals That Rely on Appreciation Instead of Performance
Any time a deal is pitched like this:
“Even if it breaks even, appreciation will make it worth it.”
It’s a red flag.
That’s not an STR strategy — it’s speculation wearing an Airbnb costume.
The deals I approve are structured to:
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Stand on operational performance
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Absorb soft years without stress
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Improve through optimization
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Function independently of appreciation
If appreciation happens, great.
If it doesn’t, the deal still works.
4. Instagram-Optimized Properties That Underperform in Reality
Design matters — but not the way most investors think.
I say no to properties that are:
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Over-designed but under-functional
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Fragile under real guest use
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Difficult or expensive to clean
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Built for photos instead of stays
The highest-performing STRs in Nashville balance:
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Durable finishes
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Smart layouts
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Efficient turnover
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Broad guest appeal
Instagram doesn’t pay the mortgage. Guests do.
5. Micro-Markets That Have Already Been Over-Extracted
Not every STR-legal area is still a good investment area.
Some Nashville pockets expanded too quickly. Supply grew faster than demand. Differentiation disappeared. Pricing pressure followed.
I actively avoid markets where:
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New STR inventory continues to flood in
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ADRs are compressing year over year
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Listings are largely interchangeable
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Long-term defensibility is weakening
Location selection today is about future survivability, not current hype.
6. Deals I Wouldn’t Personally Own
This is my final filter — and the most important one.
If I didn’t feel comfortable:
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Holding the property through a down year
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Owning it without perfect management
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Defending the purchase five years from now
I won’t recommend it to a client.
My reputation compounds slower than commissions — and I protect it accordingly.
Why Most STR Buyers Never Get This Filter
Most investors never see how many deals should be rejected — because most advisors aren’t incentivized to say no.
Saying no:
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Takes more time
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Requires conviction
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Reduces short-term volume
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Demands experience
Anyone can find deals.
Very few are willing to kill them.
Who This Matters Most For
This approach is especially important if you are:
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A first-time STR buyer in Nashville
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A high-income professional investing passively
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An investor prioritizing durability over hype
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Someone who cares more about outcomes than ownership
If that’s you, the filter matters more than the funnel.
Final Thought
The short-term rental market didn’t disappear.
It matured.
And in mature markets, judgment beats enthusiasm every time.
If you’re actively evaluating STR opportunities, start with our full Nashville Short-Term Rental Guide for zoning, underwriting, and deal strategy: Short-Term Rental Guide.
Jack Costigan is a top-producing Realtor® and founder of The Costigan Group at Compass Nashville, specializing in short-term rental, investment, luxury, relocation, and residential real estate across Greater Nashville and Middle Tennessee. Known for his data-driven strategy, modern marketing approach, and high-touch client experience, Jack advises homeowners, professionals, and investors on identifying and executing high-performing real estate opportunities.
