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Airbnb arbitrage. Do you allow it? What’s You’re experience and opinion?
I listed my home for rent and was contacted by a company who is interested in Airbnb arbitrage. They agree to sign a 12 month lease and of course will Airbnb the property. For me, I don’t mind that model and I understand it. What has you experienced been for people who have done this or are currently allowing this in your properties? If I had a little more time I think I would try to run it myself but I’d like my property to be more passive and collect rent each month. What are your thoughts and experiences?
thanks, Ram
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I would vet them intensely and make sure the lease is personally guaranteed. In my opinion if there is profit to be made why don't you pay a designer to furnish it and turn it over to a property manager and cut out the arbitrager middle man?
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Property Manager
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I wouldn't do it myself @Ramiro Rodriguez.
I agree 100% with @Andrew Steffens for sure. Just because they have some cool letterhead and a "business" doesn't mean they aren't working outta the back of the white van...next to the speakers they sell.
I would charge a 25% premium over going LTR rates. I would require a much larger deposit than a usual LTR lease requires. Personal guarantee 100%.
The bottom line is if you are getting contacted for arbitrage, then I would seriously consider doing it yourself. Take a look on VRBO and AirBNB and see what other places are bringing that are near yours and similar.
Check out https://www.awning.com/airbnb-estimator. Pop the address in there and see the basic figures for other units nearby.
Then go do it yourself.
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I wouldn't do it either. Too much risk.
I would use a licensed insured PM that has years of experience.
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Hello all,
I am new to the forum.
what are thoughts on Air BNB Arbitrage ? I seen some courses - starting at 2k..
I am in Canada, looking to invest in Florida. Should I hire an interior designer to stage the home and air bnb the property that I invest in and hand it off to a property manager to mange the air bnb ? Any connections of PM or Interior designers in Florida ?
looking for some guidance !
Thanks !
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Michael Baum and John Underwood: as always, best advice!
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@Ramiro Rodriguez We have experience in Airbnb arbitrage. Through our property management business, we had a single family home for rent and was contacted about renting it to use it for Airbnb arbitrage. We contacted our client/owner and asked him if he was open to it, which he was. We looked into what was required from the owners standpoint and it turned out he needed a slightly different insurance to cover the property's use for short term rental purposes, even though he wasn't the one actually renting it out. Also, we vetted the renter/Airbnb arbitrager and it turned out they were successfully doing it with about 6 other homes in FL. We verified their income from those properties and discussed their renting policies. Ultimately we decided to proceed with them and signed a 1 year lease as normal. We requested 1.5x deposit and they would cover all maintenance expenses under $500. It turned out to do very well for us and the owner, as there were no maintenance issues except for one larger issue that had to deal with old pipes. I would recommend going that route but just make sure you do your due diligence first, ask for referrals and understand their renting policy.
Hope this helps!
Elenis
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Many landlords love having an arbitrager using their property for the following reasons....
So the home rents well, it's kept in perfect condition all the time.
Professionally cleaned at least 4 times a month.
So long as the property is over $150 a night, it's a proven fact that STR guests are much easier on the property the LTR tenants.
And usually because the arbitrager has spent money to furnish the property, they want to make a go of the unit. So, it's easier to get monthly rents from an arbitrager then a tenant that has nothing to lose.
It all depends on the landlord...many like their home used as a STR arbitrage unit, and others say no without truly thinking thing about it. So, it all depends on where you fall and what you think about rental arbitrage.
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Just make sure you are insured
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@Sarah Kensinger don t forget investors can build and triple net lease their properties via a long term lease to management companies and enjoy all the benefits of passive investing.
You are right .management companies who are responsible for taxes , insurance and maintenance, will make sure the property and furnishings( which they paid for) are well taken care of.