Short Term rentals (AirBnB-VBRO) business models
The business model for AirBnB & VBRO is becoming more and more risky every day.
The problem is various cities are intervening with new codes restricting what is know as Short Term Rentals(str). Length of stay may vary from city to city and some are declaring anything less than a full month as STR.
So if today there is no such restriction(s) and it is a viable business model for you now, how long can you assume that will continue and if it changes, can you survive the change.
CAVEAT EMPTOR.
Most Popular Reply
I have a 6 bedroom house here in Seattle that I use exclusively as a vacation rental. I rent it from some investor friends of mine; we have an agreement set up where I pay rent slightly below market value and give him a profit share in our vacation rental. This month we are on track to profit over $10k, so it has been extremely successful, especially in the summer.
We knew that the city was working on proposal to restrict these sort of rentals, so we factored that in to our lease in case the city made it illegal for us to proceed. Since our house is very large, we have considered licensing it with the city as a legal Bed and Breakfast, so that is another option we are looking into if this legislation goes through.
Our long term plan is to purchase rural properties (cabins) in the mountains, and rent them as short term vacation rentals. While the cash flow won't be as high, the small mountain towns rely quite a bit on tourism, so we don't anticipate any regulations being placed in those areas that would prohibit us from continuing.
This is definitely a topic that I am very interesting in keeping tabs on and discussing further, so I'd love to hear what others have to say.