All Forum Posts by: Alexander Knox

Quote from @James Carlson:

@Alexander Knox

We get investor clients wanting an MTR in Denver or Colorado Springs and they always ask about targeting insurance companies or travel nurse groups, but I think that's overthinking it. The vast majority of medium term renters will look on the big platforms -- Airbnb, Zillow Rental Manager and Furnished Finders. So be where the eyeballs are, that's what I think.

You do have to think about each platform a little differently, though. For Airbnb, for instance, you should put "30+ day rental" in the headline to differentiate yourself from other listings that will show up in a search for a 3-month stay, but are really just short-term rentals with STR pricing.

For Zillow, which doesn't have headlines for its listings, you'll want to doctor your first photo to put "30+ day rental" overtop it in some way so that MTR renters can easily differentiate you from the mostly LTR listings on there.

Furnished Finders ... I still think it's worth posting there, but I'll say that none of our Colorado medium-term rentals, nor our clients midterm rentals, have gotten tenants from FF in awhile. I think they changed something in their algorithm, and something's off. 

Anyway, I wish you luck!

 Thanks for this, James. I've got the place listed on a few of the sites you named and gotten some response but as you pointed out, I want to look at a targeted MTR approach. Do you personally reach out to those MTR groups (nurses/insurance?) or have any knowledge on where I could join a network group like that? It would be great to have a pipeline with a placement company but I havent had any luck in hearing back from them. 

Quote from @Joe S.:

Quote from @James Hamling:

@Alexander Knox as a person who has very happily "sold" several STR-Arbitrages, I have long wondered if I am the only one with great results loving it because by the way people bad-mouth it, I don't get it.

I HATE the ignorant response of "well, why not just do it yourself". Well, for the exact same reason I have someone else do my oil changes, roof my properties, fix the a/c, and the countless other things. Because my time is not best served doing all the things. Same reason Sam Walton didn't stand at a check-out register. 

My #1 problem with "selling" STR-Arbitrage is that I don't advertise I do this, so I don't know how a Host-Partner would find me and that I do this, and that I'd love to do, a LOT more of it.

It's been a hell of a win-win. 

Now yes, I vet the hell out of a Hosting-partner, but that doesn't mean I only take people with giant volume of experience. I took on one who had 1 property of experience, but they did everything right on that, and let me grill the heck out of em, fully understanding my position. They showed the most important traits I could ask for; Understanding and Effort. And, they've done great. 

So far, the only issue I had is with 1 hosting partner getting greedy. Read some post or book or whatever somewhere and wanted to press to expand his net $4k monthly too $5k+, which no, pigs get fat and hog's get slaughtered. 

Now, I don't do a standard lease. The hosting partner covers all gen. maintenance on everything but infrastructure, we cover that. And it works out very well for both sides. And yes, I get above market rents but so far every one of my STR Hosting partners is clearing on average $3k+net per month, per unit. I'd call that a hell of a win for them.

I know a ton on STR's, I "could" do one myself, but it's a time-suck I don't want to take on. I am happy taking my side and letting someone else thrive in the hosting side of things. What people don't get is this affords me more time and energy to scale, to dig up the next great property, and it affords the hosting partner more scalability in their side of things as their up-front costs are mitigated greatly. It's a win-win.

For example, I got a new one today I am looking to "sell" arbitrage. It was $1.2m acquisition. It comp's out $7-$10k monthly on STR and it could double even triple that with some adjustments to site. What STR person can dump a couple hundred K into just acquiring, than outfitting, launching, marketing a place? maybe a handful of people. But on arbitrage, it's now ten's of thousands vs hundreds of thousands. The site is with acreage for future development, so it's a win-win to have someone operating the existing property for profit, on both sides, while we crawl-forward on land side of things.

I feel like those saying it's dumb, don't do it instead do it all yourself, are just arm-chair-quarterbacks who simply don't know what there speaking of, yelling from the nose-bleed section on how to play a game there never playing themselves. 

The concerns of vet your people and strategy, heck yeah but that's universal for any/every business partnership. It is a JV and needs to be approached and entered as such.

But far as issues, my only one is more, I'd like more hosting-partners because I have plenty of properties that come through pipe-line as viable, no shortage there. Maybe I just got a horse-shoe up my wazoo but so far, batting 1000 after a few years into it. 

I had serval houses that probably could have made good short term rentals. I never been approached by someone wanting to do an arbitrage in them though.

If you could list your properties for arbitragers specifically, would you be inclined to rent to them? What might make you say "yes" or "no"? How would you do the due diligence on those tenants?

Quote from @James Hamling:

@Alexander Knox as a person who has very happily "sold" several STR-Arbitrages, I have long wondered if I am the only one with great results loving it because by the way people bad-mouth it, I don't get it.

I HATE the ignorant response of "well, why not just do it yourself". Well, for the exact same reason I have someone else do my oil changes, roof my properties, fix the a/c, and the countless other things. Because my time is not best served doing all the things. Same reason Sam Walton didn't stand at a check-out register. 

My #1 problem with "selling" STR-Arbitrage is that I don't advertise I do this, so I don't know how a Host-Partner would find me and that I do this, and that I'd love to do, a LOT more of it.

It's been a hell of a win-win. 

Now yes, I vet the hell out of a Hosting-partner, but that doesn't mean I only take people with giant volume of experience. I took on one who had 1 property of experience, but they did everything right on that, and let me grill the heck out of em, fully understanding my position. They showed the most important traits I could ask for; Understanding and Effort. And, they've done great. 

So far, the only issue I had is with 1 hosting partner getting greedy. Read some post or book or whatever somewhere and wanted to press to expand his net $4k monthly too $5k+, which no, pigs get fat and hog's get slaughtered. 

Now, I don't do a standard lease. The hosting partner covers all gen. maintenance on everything but infrastructure, we cover that. And it works out very well for both sides. And yes, I get above market rents but so far every one of my STR Hosting partners is clearing on average $3k+net per month, per unit. I'd call that a hell of a win for them.

I know a ton on STR's, I "could" do one myself, but it's a time-suck I don't want to take on. I am happy taking my side and letting someone else thrive in the hosting side of things. What people don't get is this affords me more time and energy to scale, to dig up the next great property, and it affords the hosting partner more scalability in their side of things as their up-front costs are mitigated greatly. It's a win-win.

For example, I got a new one today I am looking to "sell" arbitrage. It was $1.2m acquisition. It comp's out $7-$10k monthly on STR and it could double even triple that with some adjustments to site. What STR person can dump a couple hundred K into just acquiring, than outfitting, launching, marketing a place? maybe a handful of people. But on arbitrage, it's now ten's of thousands vs hundreds of thousands. The site is with acreage for future development, so it's a win-win to have someone operating the existing property for profit, on both sides, while we crawl-forward on land side of things.

I feel like those saying it's dumb, don't do it instead do it all yourself, are just arm-chair-quarterbacks who simply don't know what there speaking of, yelling from the nose-bleed section on how to play a game there never playing themselves. 

The concerns of vet your people and strategy, heck yeah but that's universal for any/every business partnership. It is a JV and needs to be approached and entered as such.

But far as issues, my only one is more, I'd like more hosting-partners because I have plenty of properties that come through pipe-line as viable, no shortage there. Maybe I just got a horse-shoe up my wazoo but so far, batting 1000 after a few years into it. 

 James, this is an awesome post!! Thanks so much for sharing and going into so much detail, extremely helpful to hear your success story. This concept of hosting partners seems like a potentially fruitful relationship. Im not sure if you've seen what Airbnb is doing but it sound like a similar platform for this. AirBnb partnering with asset owners, then "renting" those units out to arbitragers, then the arbitragers use the units for STRs: https://www.airbnb.co.nz/airbnb-friendly?_set_bev_on_new_dom.... Curious to hear any thoughts on this.. Im not sure I fully understand the mechanics of it but with your experience, it'd be great to hear your perspective. 

Quote from @Lauren Lockett:

Quote from @Alexander Knox:

Hi all,

I am curious about how people are successfully operating rental arbitrage businesses. I own multiple rentals in the south/mid west and recently I was approached by an aspiring arbitrager to lease out one of my duplexes. They have furnished the unit as well as complied with my annual rent increases and its been a great long term relationship - they've always paid on time or early, I collect my rent, they maintain their "place of business" keeping my property running tight, and they in turn profit by doing STRs.

Myself coming from the ownership side, I am not looking to get into the businesses but I am just curious what successful arbitragers are doing and possibly what horror stories people have. Simply looking to gather some insight on:

Who has been successful in rental arbitraging and what leads to that success? Is it property managers who have quality systems in place already who are just diversifying their business model? How are leads being generated for this, there really isn't a "Zillow" where people can go to find arbitrage opportunities, its all market research and cold calling it seems. I have seen very mixed reviews scouring through the BP forums and am curious.

Does anyone have horror stories or major problems faced that stopped them from success in this business? What would make this method more attractive?

Thanks all for sharing insights!

 WOW! Happy to hear how successfully it's working out for you! Kudos to you to staying open to an investor wanting to do that! I'm curious, what made you say yes? 

 I think what made me agree to it was the lengths he was willing to go in order to make this a good deal for me: paying 2 months in advance, agreeing to take care of incidentals/management/maintenance of the unit, as well as signing on a guarantor. In exchange he was also looking to have first right of renewal but again, he's been paying on time and has agreed to rent increases so for me, having a consistent occupancy from a seemingly creditworthy tenant who's paid two months in advance gave me some comfort to say yes. The property is targeted towards student rentals otherwise, so believe it or not, the maintenance I have to do is actually more with the student renters than with the rental arbitrager. If I could rent both units to him, I probably would! 

Quote from @Andrew Steffens:

It can be ok OK but I doubt it.  They will be making a spread that you could yourself make, or they will not be making a spread and they will not pay you, or will terminate lease etc.  If I were you I would look at the numbers and see that you can either do it yourself, or hire a management company, or just rent long term.

I don't want to do it myself, I am happy collecting long term rents and letting my rentals be passive but so far things have been consistent with this 'tenant' - I've even had him sign a guarantor for rent payments AND had him pay 2 months rents in advance to protect myself as much as I felt necessary. Im interested what makes him (and others in the BP community) able to succeed where I've heard/read so many posts of people failing or talking down on the arbitrage model. I am going to try and chat with him on this but curious to just hear everyones experience!

Quote from @Bruce Woodruff:

Questions: How long have they been doing this? Do you know what they gross per month? Are you charging them more than market rent?

 Hey Bruce, I am not too sure how long they've been in business for but they are seemingly doing well enough to take two cycles of 8% rental rate increases. I do know that his businesses is just him and I believe hes got a few of these that he manages full time I believe. I am not charging more than market rents however as part of our agreement, he is taking responsibility and addressing any damages in the unit as a result of his tenants. It is his 'place of businesses' so there is accountability to keep my place well kept on his end. On the flip side, in my other units, I am the one footing the cost for things like paint scuffs, lights out, etc. so in a way he is 'managing' the property and covering costs and has been paying me so its proven to be a mutually beneficial business relationship so far. I'll speak to him to get some insight on his experience. Curious to hear success/horror stories of this model. Its intriguing to me that people are doing this and Im curious how popular it is/why its unpopular.  

Hi all, 

I own a rental just a few blocks away from Old Town Scottsdale. I've recently renovated the place and have had it listed for a few weeks with some traction, tours, but no commitments just yet. I've done extensive research and comped out rents with a solid margin for vacancy. This all said, I am pricing my unit very competitively and have gotten positive feedback on the tours but I am struggling to get mid-term renters to commit. I am wondering how successful mid-term renters on here have been advertising their properties. I am targeting travel nurses as the property is close to 4 medical centers in the area but again, struggle to get more commitments. Is there a way to tap into recruiting/placement agencies for these medical centers? Does it make sense to hire a property management company who may have the connections with these recruiters/placement agencies who may be able to help with a more steady stream of mid-term tenants. 

Any advice is welcome. Thanks! 

Hi all,

I am curious about how people are successfully operating rental arbitrage businesses. I own multiple rentals in the south/mid west and recently I was approached by an aspiring arbitrager to lease out one of my duplexes. They have furnished the unit as well as complied with my annual rent increases and its been a great long term relationship - they've always paid on time or early, I collect my rent, they maintain their "place of business" keeping my property running tight, and they in turn profit by doing STRs.

Myself coming from the ownership side, I am not looking to get into the businesses but I am just curious what successful arbitragers are doing and possibly what horror stories people have. Simply looking to gather some insight on:

Who has been successful in rental arbitraging and what leads to that success? Is it property managers who have quality systems in place already who are just diversifying their business model? How are leads being generated for this, there really isn't a "Zillow" where people can go to find arbitrage opportunities, its all market research and cold calling it seems. I have seen very mixed reviews scouring through the BP forums and am curious.

Does anyone have horror stories or major problems faced that stopped them from success in this business? What would make this method more attractive?

Thanks all for sharing insights!

Hi all,

I am curious about how people are successfully operating rental arbitrage businesses. I own multiple rentals in the south/mid west and recently I was approached by an aspiring arbitrager to lease out one of my duplexes. They have furnished the unit as well as complied with my annual rent increases and its been a great long term relationship - they've always paid on time or early, I collect my rent, they maintain their "place of business" keeping my property running tight, and they in turn profit by doing STRs. 

Myself coming from the ownership side, I am not looking to get into the businesses but I am just curious what successful arbitragers are doing and possibly what horror stories people have. Simply looking to gather some insight on:

Who has been successful in rental arbitraging and what leads to that success? Is it property managers who have quality systems in place already who are just diversifying their business model? How are leads being generated for this, there really isn't a "Zillow" where people can go to find arbitrage opportunities, its all market research and cold calling it seems. I have seen very mixed reviews scouring through the BP forums and am curious. 

Does anyone have horror stories or major problems faced that stopped them from success in this business? What would make this method more attractive? 

Thanks all for sharing insights!