Can't Get Numbers to Work for AirBnb

[Andrew C.]

Hi all,

Please go easy on me I'm more of a long-term investor but I wanted to dip my toes into the AirBnb pond by taking on my first property:

House = $20k

Septic = $7.5k

Well = $10k

Septic Plan = $1.5k

Building Permit = $1k

Site Work / Driveway = $5k

Concrete Foundation = $15k

Plumbing / Electrical = $15k

Furnishings = $10k

Pond = $5k

Land = $50k

Total = $140k

There are AirBnb's in the area renting for $100 / night and at that rate I would have to rent mine out every day of the year for 4 years straight before I breakeven.

Can anybody help get the numbers to work?

Thanks!

[Nathan Gesner]

When I was a kid, I could buy a six-pack of pop for $2. I would sell four of the pops to my siblings for $0.50 each. I drank the remaining two and would use the $2 earned to buy another six-pack. Rinse and repeat.

But what happens if the price of a six-pack price increases to $3? I would have to sell all six pops at $0.50 each just to break even. The math no longer works.

It's really that simple. Income - Expenses = Profit

House prices have skyrocketed in the last few years but income has not increased at the same rate, so you can't profit the way we used to. You have to work really hard to find the unicorn that still cashflows, you have to wait until the numbers change and start to work again, or you need to shift to another strategy.