All Forum Posts by: Carrie Penney

Yep, definitely. We are thinking about doing it here too. There are sooo many people we talk to about AirBnB that have no clue what we're talking about. Instead of being excited about our income they seem overwhelmed by it, so I think there is definitely a market for this. I think you could do really well by advertising right and convincing people to convert from traditional rentals to an AirBnB model. Good luck! Let us know how it goes if you do it.

I agree with @Jordan Moorhead about the roommate. Would they pay $500-$600? Then you could cover your utility bills and have some more money in your pocket. House hacking like this has worked so well for us. We quickly stashed enough money to purchase a second property and are looking at another right now (only 2 months after the last purchase). We're planning on eventually moving out of our house and renting the rooms (4/3) on AirBnB, while having someone we know live in the master at reduced rent ($350-$400/mo v. $500) to manage the AirBnB guests. Money adds up so fast when you're not paying your mortgage! Good luck to you. Even if you can't deal with a roommate, this is still a nice deal. 

@Account Closed, in our market (college town in Texas) AirBnB has been awesome. We make more than 2x as much as we would on a traditional rental. It is true that it is a lot more work, though. If it is close to you and your only rental, it may be easy for you to do the cleaning and stuff yourself. Someone mentioned a property management company taking 10-20%, but on AirBnB properties, I think that number would be MUCH higher, as they could potentially be cleaning it every single day. If you're not doing the cleaning, it may be best to find a person you trust to do it for you, rather than hiring a property management company. For us, AirBnB is definitely the way to go right now.

If you absolutely can't afford the property without hitting a certain amount of revenue, or require stability/want to know the exact amount you'll make each month, AirBnB may be too stressful for you. Also, if you are unable to manage the property yourself, your expenses may be too high. When making comparisons, realize that you will have to pay for furniture, utilities, and cable/internet. You'll have to determine if your profit is high enough to warrant the extra work/time. You can get on the AirBnB website/app and send an inquiry to any host on there. I would ask questions about their occupancy rates, average utility bills, and nightly rental rate. AirBnB is a great community (like BP!) and usually hosts are really friendly and willing to help.

Best of luck in your decision!

Jenna Pham ah, yeah, I just meant Magnolia has helped make Waco more of a "destination" spot, which is always nice for us investors. Hopefully my mom will move. She has a paid off house in Temple (no attraction, house hacking not even an option) that's really just wasted equity right now. If I can get her into something producing income, that would be pretty sweet. I just keep on top of listings there hoping to score something. I also looked at AirBnB's site for Waco listings and they seem to be paid well and maintain good occupancy.

@Jenna Pham I haven't actually invested in Waco yet but have been looking heavily at the market there. The prices and area feel a lot like Lubbock and I think our model could work really well there. My mom lives pretty close to there right now and I'm trying to convince her to actually move to Waco and do some kind of house hacking while we explore the market more. 

A traditional rental on a 3 bedroom in Lubbock could rent for $1200-$1500 depending on how nice it is/proximity to campus. Students easily pay $400-$500 per room. It would need to be at least a 2 bath to rent at that rate. Would probably rent for $900-$1100 if it had only 1 bath or was further from campus. 2 bedrooms can rent for $750-$1000. There are houses right now in a neighborhood that is walking distance to campus and MLS has asking prices starting in the 50k range. Most of those need some TLC but we have gotten lucky with some just needing paint/flooring. We're hoping to find some deals outside of MLS but we are really new to this, so that's where we started.

Several years ago, most of the neighborhoods surrounding campus were really bad/kind of scary, but investors have really cleaned up the neighborhoods. Luckily there are still some houses around that are cheap to buy, and property values are rising nicely. 

We live close to the university and rent one room in our house for $500/month, and another room on AirBnB. 

In Texas, good cities are mid-sized college towns, like Lubbock (Texas Tech) and Waco (Baylor, also Magnolia Farms for girl's trips). I live in Lubbock and have a couple of AirBnB properties that were really cheap to get into and do AWESOME on AirBnB (bring in more than double what a traditional rental would). I wouldn't invest in Austin when these kinds of cities are available. Sometimes I look at Austin MLS for fun and yesterday I saw a $190k "tear down" in an unlivable part of town. It's just insane right now. Maybe look for affordable cities that have some kind of draw to them like universities (especially if sporting is big there) or concerts/festivals. Just remember to have some exit strategies in case the city tries to shut you down or there is too much competition with short-term rentals.

I have a lot of experience with AirBnB, so I'll try to offer some insight. In my market (college town, population 250k, not much draw besides the university/college football games) we manage to stay pretty booked up on AirBnB. Our occupancy rate can range anywhere from 60-85%. That's definitely a big swing, but we just acquired a new AirBnB property that we began renting this month, so we're still working on adjusting rates properly. Anyway, one rental is a single room in our house, that rents for about $40/night or $75/night on weekends. It's a nice space with private outside access, private bathroom, and fridge/microwave. We have had many people stay here for weeks or months at a time. The other rental is an entire home, a 2/1 that rents for $65/night or $90/night on weekends. Most people traveling on AirBnB are thrifty, so I don't know that $100/night would work with so much competition around. If you did separate rentals at $50/room, that might work and appeal to mid market people. This still gives you the $100/night that you want, but is much more reasonable to thrifty travelers. Most people there are probably there for at least a week so $100/night is a bit much. If each bedroom would have access to their own bathroom, this would probably work really well. If it is a shared bath, your rate may need to be a little lower. You can put a statement on your listing that the full place is available as well, and groups may send an inquiry for booking. I am extremely frugal but would still definitely be willing to pay $50/night for a nice, comfortable place over a hostel. You'll probably see a lot of people in their 30s-40s who do not want to stay in a hostel, but are also unwilling to pay high resort rates. I think this could work for you, especially if in an area frequented by travelers/tourists. Also, one trick to add a little cash cushion in case of low bookings - add a cleaning fee of $10-$20 (this is total, not per night). This works well because if someone is staying more than a couple nights, that's not much additional money on a per night calculation. Also the cleaning fee can detract short term (1 day) bookings, meaning you get longer reservations, and spend less time with turnover (laundry/trash/dishes, etc). AirBnB doesn't include the cleaning fee when initially viewing rates so it will just show $50/night and people will think it's a great deal, then after they get started with the booking, they will see the cleaning fee. I know I have found places before and got my heart set on them before seeing the cleaning fee, so usually I just accept it. $10-$20 total isn't much to add to a booking.

Your profile says you're considering moving to Salt Lake. That's probably a great idea if you don't have something tying you down where you are. According to a quick MLS search there are way more opportunities for you in Salt Lake, regarding real estate. The great thing is you claim to have a lot of equity in your current home. Maybe start with something easy like house hacking so you can get experience and save up money while someone else pays your mortgage. I have vast experience with AirBnB rentals in a small city (250k) without much draw, and I assume SL would do really well on AirBnB. In my city, I make more than 2x on AirBnB what I would with traditional rental. Fortunately there is plenty of opportunity for all of us. Don't get discouraged by what you see on this site. Someone is always better, stronger, faster, etc. But there's still room for you, too. It does seem like your mindset is kind of wonky right now, though. You put blame on all kinds of things around you instead of making RE a priority. My fiancé and I are extremely busy with full-time jobs, full-time graduate school, and buying/flipping/renting/remodels. We sometimes work til 2am on our RE stuff just to fit it all in. There's definitely no room for pity if you're working as hard as you should be. Maybe you should re-read your goals. They seem specific and well thought out. Maybe reading them will get you back on track. And if this site just doesn't sit right with you right now, try to find a good book that will get you motivated again. I don't know how many podcasts you've listened to on here, but they are a great source of information.

Garrott Nalle