AirBnB arbitrage tips and suggestions. New to the space.

Member since 2025 · 6 posts · 1 vote

Howdy yall, I’m pretty new to the space and I was just wondering if anyone here is actively pursuing Airbnb Arbitrage and if they have any tips on how to get started or anything or anyone I can learn from. Thanks!

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John UnderwoodPro Member

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

My advice is to buy properties and not just create a job managing other people's properties.

Also you should be a licensed PM and have insurance to manage other people's properties legally.

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John UnderwoodPro Member
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
1y
My advice is to buy properties and not just create a job managing other people's properties.
Also you should be a licensed PM and have insurance to manage other people's properties legally.
8 Reply
- Jon Martin
  Member since 2022 · 1k+ posts · 1k+ votes
  1y
  Quote from @John Underwood:
  
  My advice is to buy properties and not just create a job managing other people's properties.
  Also you should be a licensed PM and have insurance to manage other people's properties legally.
  
  This. You are already putting up at least some cash to sign the lease and furnish the place, so why not deploy that cash in a better way and have ownership?
  
  I would look into a house hack with 3.5-5% down, such as a single family home with a detached garage or walk out basement that you convert to a 1-bedroom for STR. If you are single or have a supportive partner, live in that unit and rent the main house to really stack cash.
  
  There are also 10% down bridge products that include rehab costs. So many great products out there, IMO it is better to use that cash to leverage equity than use cash (or credit cards) to pay for security deposits and furniture.
  3 Reply
Collin HaysBusiness Member
Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
1y
Rent it out for more than you are paying. Rinse, lather, repeat.
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Mike GrudzienPro Member
Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
1y
And make sure that your lease allows subleasing.
1 Reply
Jeremy Horton
Rental Property Investor · Somewhere over the Rainbow · Member since 2021 · 1k+ posts · 1k+ votes
1y
I personally don't like the arbitrage model - short sighted and high risk in my opinion. I'm sure it has been done successfully some places, especially over Covid when travel was up.
There is a MYTH that every LTR would do better as a STR. This is simply not true. Sure a house on the beach will make more at a STR than a LTR, but a typical house in a regular neighborhood (if STRs haven't been banned yet) will likely not.
I prefer to stick to the tried and true LTR - buy a distressed property at a discount, in a good location. Force equity through a rehab. Then place a long term tenant in the property. Rent the property - take the small cash flow, appreciation, loan paydown and tax deductions and build wealth over time. The asset is the investment for me, personally.
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- Jon Martin
  Member since 2022 · 1k+ posts · 1k+ votes
  1y
  Quote from @Jeremy Horton:
  
  There is a MYTH that every LTR would do better as a STR. This is simply not true. Sure a house on the beach will make more at a STR than a LTR, but a typical house in a regular neighborhood (if STRs haven't been banned yet) will likely not.
  
  You don't have to pay for your LTR tenants power, water, cable/wifi, toilet paper, coffee, dish soap . . . The list goes on. You don't send them a partial refund because there was a hurricane or a power outage. Insurance isn't 2X+ what a normal policy costs. The hidden costs really stack up.
  2 Reply
Kate Sanchez
Member since 2025 · 242 posts · 98 votes
1y
@Tanner Davis Welcome! Start by building strong relationships with landlords - trust is the key. Also, focus on great furnishing and location. Wishing you success in your STR journey!
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Andrew SteffensBusiness Member
Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
1y
It's been a long time since we had an arbitrage post!
Please use the search feature to search through old threads, this has been covered at length. Just on this post some good points have been made - no wealth creation, not the best use of capital, I will add 2 more quick points:
1. Risky - Look at COVID - that crushed most arbitragers. Many went months if not years without bookings and had to go bankrupt. Many landlords will require large deposits and personal guarantees. This could crush you.
2. No longer profitable - I actually started out in a arbitrage (before the word was even being used in this context). I rented out a beach mansion in foreclosure for $5500 a month and was able to make $20k+ a month subleasing as a STR. Ive never seen any opportunity like this since then. More likely you will rent a 3/2 pool home for $2k a month and furnish/outfit for $15k on the low end. You will then re-lease it for an average of $5k a month. After paying utilities and maintenance costs you end up with $3,500 a month, so $1,500 profit. Hurray! Now in 12 months at lease end you will end up at $3,000 net profit (if you are lucky) and a bunch of beat up used furniture.
Does that sound good to you?
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- Brendan Mullenholz
  Real Estate Agent · Washington, DC · Member since 2025 · 157 posts · 77 votes
  1y
  Quote from @Andrew Steffens:
  
  It's been a long time since we had an arbitrage post!
  Please use the search feature to search through old threads, this has been covered at length. Just on this post some good points have been made - no wealth creation, not the best use of capital, I will add 2 more quick points:
  1. Risky - Look at COVID - that crushed most arbitragers. Many went months if not years without bookings and had to go bankrupt. Many landlords will require large deposits and personal guarantees. This could crush you.
  2. No longer profitable - I actually started out in a arbitrage (before the word was even being used in this context). I rented out a beach mansion in foreclosure for $5500 a month and was able to make $20k+ a month subleasing as a STR. Ive never seen any opportunity like this since then. More likely you will rent a 3/2 pool home for $2k a month and furnish/outfit for $15k on the low end. You will then re-lease it for an average of $5k a month. After paying utilities and maintenance costs you end up with $3,500 a month, so $1,500 profit. Hurray! Now in 12 months at lease end you will end up at $3,000 net profit (if you are lucky) and a bunch of beat up used furniture.
  Does that sound good to you?
  
  Well said!
  1 Reply
Myka Artis
Rental Property Investor · Arlington, TX · Member since 2016 · 706 posts · 611 votes
1y
I had about five arbitrage opportunities in Houston for a while, but I pivoted away from arbitrage in 2024. If you plan to arbitrage, ensure you negotiate your rents. If you are acquiring multiple units in one apartment complex, stagger your lease start dates to allow time to furnish them all without incurring rent payments. Also, when you're looking to arbitrage, make sure you fully vet the landlord and put clauses in there regarding how fast maintenance issues are resolved. If you're working with a private landlord on one house, make sure their insurance will cover vacancies and any other loss of income. Arbitraging is dependent on your landlord, whether you will make money or not, so the lease is where the money is made. I could go on for days regarding arbitrage. Still, my final sentiment is to invest all your profits in properties that you can own in the long term, thereby reducing your overhead of rent payments, which can be challenging to sustain over time, and engaging in arbitrage.
3 Reply
- Holly BrownBusiness Member
  Real Estate Agent · Houston, TX · Member since 2019 · 190 posts · 137 votes
  1y
  Quote from @Myka Artis:
  
  I had about five arbitrage opportunities in Houston for a while, but I pivoted away from arbitrage in 2024. If you plan to arbitrage, ensure you negotiate your rents. If you are acquiring multiple units in one apartment complex, stagger your lease start dates to allow time to furnish them all without incurring rent payments. Also, when you're looking to arbitrage, make sure you fully vet the landlord and put clauses in there regarding how fast maintenance issues are resolved. If you're working with a private landlord on one house, make sure their insurance will cover vacancies and any other loss of income. Arbitraging is dependent on your landlord, whether you will make money or not, so the lease is where the money is made. I could go on for days regarding arbitrage. Still, my final sentiment is to invest all your profits in properties that you can own in the long term, thereby reducing your overhead of rent payments, which can be challenging to sustain over time, and engaging in arbitrage.
  
  This insight is spot-on. We had a single arbitrage unit in 2019, and it proved the point: you’re far better off owning a modest condo or house yourself than relying on a landlord who can easily make or break your success. Thanks for sharing this Myka.
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Josh SedivyBusiness Member
St. Louis, MO · Member since 2024 · 134 posts · 55 votes
1y
Airbnb arbitrage can work well, but like any strategy, it depends on your market knowledge, lease terms, local regulations, and how well you manage both guest and landlord relationships. It’s less about the model and more about how well you operate.

Owning is better for long-term wealth, you get equity, tax benefits, and more control. But arbitrage can be a smart way to build cash flow, test systems, and get started with lower upfront costs.

At the end of the day, the key is how well you manage the day-to-day, keeping everyone informed, handling the details, and staying on the right side of local laws.
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Michael BaumPro Member
Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
1y
Hey @Tanner Davis, welcome to the forum. As you can see, arbitrage is a subject that we have been discussing more than regularly for years but it has slowed down in recent time.

I would go do a search on arbitrage if you want more info but you will find most of us here frown on it for good reason.

If you are interested in investing, I might do something like this.

If you are young and single or married with no kids (kids need the stability so this could be a PITA) then I would look for a triplex or fourplex and buy it with a FHA 3% down loan. Live in one and rent the others after a rehab. Keep it for about a year, then refinance into a conventional loan.

Then go and look for another up to 4 plex property and do another FHA loan for it, move into one then rinse and repeat.

Do it a couple 3 times and then you will have 3 or 4 performing long term rental properties. Building equity and providing cash flow. Then you can look at branching out into other investments because you will have equity you can use.

That is what I think the best way for most younger folks can do to build a great portfolio.

Just ask @John Underwood. He makes his bank on his stable LTRs with STRs being strong cashflowing after the LTRs were kicking a$$
1 Reply
Ryan Franzi
Member since 2024 · 1 post · 1 vote
1y
My girlfriend and I just started arbitrage. I've had an interest in the air bnb space for awhile and thought this would be a good way to learn the STR market without a large upfront investment.

Can't say whether or not it's worth it yet, however, after furnishing, administrative fees, landscaping, etc. you're fronting an amount of cash that would be comparable to a 3-5% down payment on an actual house.

It's always better to own property than rent, considering the equity buildup, appreciation, and tax deductions but if you want to test out the arbitrage method here's what we did:

• Gathered a list of markets where STR demand is high

• Narrowed down the list to cities with no STR restrictions

• Contacted landlords and made sure they were ok with subleasing

• Gathered comps, air dna data, and local tax rates to find our average daily rate and the minimum number of days we'd need to be booked to break even

• Decided on a house and got to work with furnishing

Be diligent with your research on the market and regulatory environment. Margins are thinner than they were a couple of years ago. Given that margins are so thin, even if you were profitable month to month, you still need to factor in your startup costs to know if you truly turned a profit.

At the end of the day, it's not that much cheaper to do arbitrage unless you can find a deal on rent. I'd rather buy another multi or even SF for a LTR.
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