Airbnb for 1st property investment? Why should I NOT do this

[Joseph Barnes]

I’m SUPER new to the bigger pockets forum.

My wife and I are looking to purchase our 1st place (townhouse or condo) in the next 6 months to 1 year. We’ve heard Airbnb is potentially a great option for cash flow so the plan is to live in it for 1 year then rent it out for a short term vacation rental. Why should I NOT do this? Or if it’s a good idea please put my nerves at ease. Thanks!

[Travers Xanthos]

Hi Joseph, I tend to disagree with most of the replies to your post. There is can certainly be an opportunity for you if you educate yourself before purchasing the property. #1 make sure that there are no short term regulations or HOA rules that would prohibit you from operating an STR.

If you find one that makes sense for you, I would recommend using the "Rentalizer" tool on at Airdna.co, it's a free tool that allows you to estimate the potential revenue that a property could generate.  It can be high or low, depending on the comparable listings, but it will give you a general idea.  You can use this link to go directly to the tool for Phoenix, no need to create an account:  https://www.airdna.co/vacation-rental-data/app/us/arizona/phoenix/rentalizer

If you are planning on living there for the first year, there are a few benefits, but I would recommend thinking about "house hacking" to get a good idea of whether you'd like to continue on as an STR or a LTR when you decide to move out. You could rent out an extra bedroom OR configure your property in a way that you can rent the entire place out for a weekend or two every month (lock on your closet door, lock on your pantry, etc.).

This is a house hacking strategy that I have been doing for years.  I rent out my house for 1-2 weekends a month and stay with a friend or take a weekend trip out of town, and the payouts usually cover my mortgage/expenses plus some!

Anyway, might be a good idea for you to try out to get your feet wet. Don't be scared off by people in this thread telling you not to mess around with STR's if you don't have experience... The only way to gain experience is to take action! You'll learn as you go. I was in your shoes 4 years ago, with no STR experience at all, now I have almost 30 of my own properties and an internal team built up to manage them for me. If I had listened to the naysayers, I would still be working for someone else!

I say educate yourself, put together a plan, and execute!  Best of luck!