Newbie Airbnb Arbitrage- Houston, Tx

Member since 2024 · 6 posts · 2 votes

Hello all! New to group and can’t wait to learn so much from you all. In Houston, Tx and planning to start short term rental through airbitrage method. Any recommendations on where to begin with searching for properties? Should I mass email? Hire someone? Looking for small unit 1bd/1 bath or even studio. Any suggestions are greatly appreciated!

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John UnderwoodPro Member

Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes

Quote from @Jewell Arceneaux:

Haven't heard anyone in a long time mention Arbitrage.

This is not investing, it is just creating a job for yourself.

You will find most investors on here are against Arbitrage.

Do a search and read through past posts on this topic

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John UnderwoodPro Member
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
1y
Quote from @Jewell Arceneaux:

Hello all! New to group and can’t wait to learn so much from you all. In Houston, Tx and planning to start short term rental through airbitrage method. Any recommendations on where to begin with searching for properties? Should I mass email? Hire someone? Looking for small unit 1bd/1 bath or even studio. Any suggestions are greatly appreciated!

Haven't heard anyone in a long time mention Arbitrage.
This is not investing, it is just creating a job for yourself.
You will find most investors on here are against Arbitrage.
Do a search and read through past posts on this topic
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Andrew SteffensBusiness Member
Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
1y
Yes please do a search through previous posts as this used to be a hot topic but not anymore. 95% of those on here are against it for good reason. Its not impossible, but it is improbable you will find success. I suggest spending your time focusing on investing and you will have a better outcome.
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Michael BaumPro Member
Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
1y
Hey @Jewell Arceneaux, yeah arbitrage isn't a thing most of us advocate.
It can work, but the last couple years have been very tough to make that strategy work, especially for new investors.
It is just a job and you don't get anything out of it in the end but a paycheck.
The only time I have said cool to anyone asking about arbitrage is someone who already had a bunch of properties (LTR or whatever) and wanted to give it a shot. They could afford to take the hit if/when it goes south.
One strategy you could look at is buying up to a four plex and finance with FHA. Low down in most cases. Move into one and rent the others. If you do it right, then you could make a decent amount of cash while building equity.
After a year, you can refi that loan into a conventional, go look for another 'plex, move into a unit, renovate your old place, rent it and start all over. You do this a few times, you will have 3 or 4 performing LTR properties and can then branch out.
I don't know if you are married and/or have kids. This strategy can be tougher with family in tow but it can be done.
If I was starting out, this is what I would do.
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- John UnderwoodPro Member
  Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
  1y
  Quote from @Michael Baum:
  
  Hey @Jewell Arceneaux, yeah arbitrage isn't a thing most of us advocate.
  It can work, but the last couple years have been very tough to make that strategy work, especially for new investors.
  It is just a job and you don't get anything out of it in the end but a paycheck.
  The only time I have said cool to anyone asking about arbitrage is someone who already had a bunch of properties (LTR or whatever) and wanted to give it a shot. They could afford to take the hit if/when it goes south.
  One strategy you could look at is buying up to a four plex and finance with FHA. Low down in most cases. Move into one and rent the others. If you do it right, then you could make a decent amount of cash while building equity.
  After a year, you can refi that loan into a conventional, go look for another 'plex, move into a unit, renovate your old place, rent it and start all over. You do this a few times, you will have 3 or 4 performing LTR properties and can then branch out.
  I don't know if you are married and/or have kids. This strategy can be tougher with family in tow but it can be done.
  If I was starting out, this is what I would do.
  
  I always tell young investors to buy a quadplex. Live in one unit for 2 years then buy another Quadplex. Do this a few times and you'll be set just from this one strategy.
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Wale LawalBusiness Member
Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
1y
@Jewell Arceneaux
To start your Airbnb arbitrage business in Houston, focus on areas with strong short-term rental demand, such as Midtown, Montrose, the Medical Center, or the Galleria. Begin by researching landlords who may be open to corporate leases—you can do this by searching rental listings on Zillow, Apartments.com, or Facebook Marketplace and reaching out directly. Instead of mass emailing, a more effective approach is to call landlords or visit properties in person to pitch your business model. Consider hiring a virtual assistant to help with outreach or working with a local leasing agent who understands the short-term rental market.
Good luck!
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Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
1y
Quote from @Jewell Arceneaux:

Hello all! New to group and can’t wait to learn so much from you all. In Houston, Tx and planning to start short term rental through airbitrage method. Any recommendations on where to begin with searching for properties? Should I mass email? Hire someone? Looking for small unit 1bd/1 bath or even studio. Any suggestions are greatly appreciated!

It can work. We have about 50 units leased to people who do STR with them. But like others said, it's not easy and is more a job than investing. The only way I've seen it work is at scale. i.e. people that own all the units in a building (or control all the units in a building). Or have at least 10 units in a small area. Having a small handful of units spread out is going to be a nightmare.
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