Airbnb arbitrage. Do you allow it? What’s You’re experience and opinion?

[Ramiro Rodriguez]

I listed my home for rent and was contacted by a company who is interested in Airbnb arbitrage. They agree to sign a 12 month lease and of course will Airbnb the property. For me, I don’t mind that model and I understand it. What has you experienced been for people who have done this or are currently allowing this in your properties? If I had a little more time I think I would try to run it myself but I’d like my property to be more passive and collect rent each month. What are your thoughts and experiences?

thanks, Ram 

[Andrew Steffens]

I would vet them intensely and make sure the lease is personally guaranteed.  In my opinion if there is profit to be made why don't you pay a designer to furnish it and turn it over to a property manager and cut out the arbitrager middle man?

[Michael Baum]

I wouldn't do it myself @Ramiro Rodriguez.

I agree 100% with @Andrew Steffens for sure. Just because they have some cool letterhead and a "business" doesn't mean they aren't working outta the back of the white van...next to the speakers they sell.

I would charge a 25% premium over going LTR rates. I would require a much larger deposit than a usual LTR lease requires. Personal guarantee 100%.

The bottom line is if you are getting contacted for arbitrage, then I would seriously consider doing it yourself. Take a look on VRBO and AirBNB and see what other places are bringing that are near yours and similar.

Check out  https://www.awning.com/airbnb-estimator. Pop the address in there and see the basic figures for other units nearby.

Then go do it yourself.

[John Underwood]

I wouldn't do it either. Too much risk.

I would use a licensed insured PM that has years of experience.

[Daniel Dass]

Hello all, 

I am new to the forum.

what are thoughts on Air BNB Arbitrage ? I seen some courses - starting at 2k..

I am in Canada, looking to invest in Florida. Should I hire an interior designer to stage the home and air bnb the property that I invest in and hand it off to a property manager to mange the air bnb ?  Any connections of PM or Interior designers in Florida ? 

looking for some guidance !

Thanks !

[Mike Grudzien]

Michael Baum and John Underwood: as always, best advice!

[Elenis Camargo]

@Ramiro Rodriguez We have experience in Airbnb arbitrage. Through our property management business, we had a single family home for rent and was contacted about renting it to use it for Airbnb arbitrage. We contacted our client/owner and asked him if he was open to it, which he was. We looked into what was required from the owners standpoint and it turned out he needed a slightly different insurance to cover the property's use for short term rental purposes, even though he wasn't the one actually renting it out. Also, we vetted the renter/Airbnb arbitrager and it turned out they were successfully doing it with about 6 other homes in FL. We verified their income from those properties and discussed their renting policies. Ultimately we decided to proceed with them and signed a 1 year lease as normal. We requested 1.5x deposit and they would cover all maintenance expenses under $500. It turned out to do very well for us and the owner, as there were no maintenance issues except for one larger issue that had to deal with old pipes. I would recommend going that route but just make sure you do your due diligence first, ask for referrals and understand their renting policy.

Hope this helps!
Elenis

[Sarah Kensinger]

Many landlords love having an arbitrager using their property for the following reasons....

So the home rents well, it's kept in perfect condition all the time.

Professionally cleaned at least 4 times a month.

So long as the property is over $150 a night, it's a proven fact that STR guests are much easier on the property the LTR tenants.

And usually because the arbitrager has spent money to furnish the property, they want to make a go of the unit. So, it's easier to get monthly rents from an arbitrager then a tenant that has nothing to lose. 

It all depends on the landlord...many like their home used as a STR arbitrage unit, and others say no without truly thinking thing about it. So, it all depends on where you fall and what you think about rental arbitrage.

[Chai Xiong]

Just make sure you are insured

[Todd Goedeke]

@Sarah Kensinger don t forget investors can build and triple net lease their properties via a long term lease to management companies and enjoy all the benefits of passive investing.

You are right .management companies who are responsible for taxes , insurance and maintenance, will make sure the property and furnishings( which they paid for) are well taken care of.