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Updated over 1 year ago on . Most recent reply

Short Term Artibrage on New Construction Triplex
I just finished a new build. Its a Triplex consisting of (3) 2 bed 2 bath identical units, with an attached 2 car garage I plan to keep for personal use. We just put the 3 units up for rent and I have been approached by a couple of different people looking to sign a lease with me , and then rent the units out through a 3rd party management company doing short term rentals. I understand the insurance requirements needed by both the lessee, and the 3rd party management company. I am not opposed to the idea, but just wondering what else I should consider before I make a decision about this type of arrangement. Any tips, suggestions, concerns or any other advice would be appreciated. The building is in Lantana, Palm Beach County. Market rents are about $2800-$3000 per unit/month. What do you think would be a fair price to lease all 3 units to one person for an arbitrage scenario?
Thanks



Most Popular Reply

- Olympia, WA
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Hey @Michael Gravallese. This is called arbitrage. Do a search and you will read a ton.
The bottom line is that I would want to see bank statements etc to make sure these people can afford to furnish and run it properly. Most arbitragers don't have 2 nickels to rub together.
If the market rent is $3000, I would charge them $4000 per unit. No way I would discount a single penny. I would charge a premium for allowing them to arbitrage your units.
They are going to need all the correct insurance for STRs. Not landlord or homeowners insurance.
I would make them get flood and wind as well.