Brampton, Ontario · Member since 2015 · 3 posts · 1 vote
Hi everyone! I wanted to get people's opinions on a business concept that I have. I was interested in buying a property in an area such as Miami or Las Vegas (due to the low cost of homes & its desirability as a tourist destination), renovating it and renting it on Airbnb. If things go well I'd even like to turn it into a business where I do this for other people, while getting a cut of their return.
Nashville, TN · Member since 2015 · 7 posts · 9 votes
11y
While I respect everyone's opinion who has posted on this topic, I will have to respectfully disagree with the "old-timer" way of thinking. It's a Luddite mentality to just hope things will remain status quo and not adjust to the changing technology. AirBnb and Uber for that matter are valued at several billion dollars and backed by venture capital companies with very strong lobbying power. These businesses are here to stay and the cities that fail to adjust will be negatively effected.
Liam, feel free to message me as I run the exact type of business in Las Vegas you are interested in. I'm at 90% occupancy on airbnb year round and have over 45 5 star reviews. I started 10 months ago and made over $60,000 revenue on two 2bd/2ba I purchased for a total of $180,000. High supply with low demand within the city result in low prices. At the same time, the high cost of hotels combined with high rate of tourism leads to great demand for vacation rentals.
I look forward to speaking with you Liam and while the rules/regulations currently make airbnb difficult in certain cities, this is the perfect time to get involved as these cities will tailor their laws over the next 3-5 years.
Thanks for the insight. You created a very profitable business that seems to require little monthly upkeep. Where did you place your ads? Did you target new investors who weren't using Airbnb and other sharing sites, or investors already on those sites who needed help improving their occupancy? What percentage did you charge of gross revenue?
Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
9y
I have a friend who specializes in renting properties out on AirBnb and makes a lot of money. A couple of points I would definitely look into first though:
1) How does the city government look at short term rentals
2) Are you buying in a building or neighborhood with an HOA and what are their rules about it (spoiler: they're usually not a fan)
3) Are you buying in an area that people staying short term will stay much. In other words, is it a good place for motels and hotels.
It's also more labor intensive (more cleanings and phone calls to take), but it can be very profitable.
There is a process in which you can do Air B&B. I recommend finding a realtor that has been through the process to get approval, to work with (message me if you want a referral). First, the building itself has to be approved for short-term and then each individual unit has to apply for an individual approval. If you're buying in a building that is approved, the process for individual approval is not expensive but it is a process that can be difficult if you haven't done one yet.
Investor · Helotes, TX · Member since 2016 · 15 posts · 0 votes
9y
I've recently been through the process of getting my condo legal for short term rental and it was both time consuming and expensive. I had to hire a licensed architect to create a floor plan with fire safety information annotated in order to get a change of use for transient rental approved. Then, I had to hire a licensed contractor to submit it. This is on top of all the other steps to set up a business entity and set up tax remittance prior to that. Check out these articles which go into some detail regarding some of the challenges: