Approaching a Property Manager About Leasing for Airbnb

Approaching a Property Manager About Leasing for Airbnb

Washington, DC · Member since 2015 · 69 posts · 54 votes

I'm looking to buy a property in Baltimore use as a short-term rental full time via Airbnb. While working through the slower parts of the purchase process (financing through a small credit union), the thought occurs to me - Why not see if I could rent a home or two and do the same thing?  

I've read some posts here about owners angered by their tenants doing Airbnb on the sly. I understand. That's not what I'm after. I want to do this totally on the up-and-up with PMs and/or LLs being totally aware of my intentions.

I take for granted that landlords/PMs are going to be predisposed to reject use as a STR - especially full time.

What are some good ideas about how to approach landlords or their reps and assuage their worries?

My instincts say I should be very forthcoming - not even asking for a viewing of a listing until I've come clean about my Airbnb plans. 

I'll also assure - and even encourage the LL to put into the lease - that I will have a STR-tailored commercial insurance policy that will supersede homeowners insurance. (Propoer Ins, underwritten by Lloyds seems like the gold standard here.)

I would also be willing to put down 2 months rent as a deposit (max allowed in MD, I believe, and double the standard). 

I can also pay more, say 10% or even 15-20%, more than current list. In most cases, that is still will below the initial listing amount from when the properties went on the market in May, June or July.

I'm also only planning to approach on properties that have been vacant for 5+ months. The Baltimore market is slower than a lot of others and a lot of big apartments are coming on line. There appears to be diminishing demand for the 4 bedroom townhomes that I'd prefer.  

Many thanks in advance for any thoughts, ideas or practices that have worked in the past.

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Rental Property Investor · St. Augustine, FL · Member since 2017 · 189 posts · 127 votes
9y
I have been in the STR business for a long time - 10 years! Wow, now I feel old! Andy, here are some pointers to get you going and approach other landlords. One on one landlord talks / presentations will be much better then a property manager. Remember, the property manager gets paid through long term rentals and may perceive you as a threat. 1. Contact your friends or colleagues and ask them if you can Air BnB a room or start your business with their help. Once you have a couple stays create a professional web site and business cards. Quality pictures, quality pictures, quality pictures. Go Daddy and a hungry college kid can develop a very professional web site for $100. Business cards are very inexpensive. 2. Contact landlords through any list company like listsource.com. You will mail them directly or call them and you will have more appointments that you can shake a stick at. An original letter that is hard hitting is key. 3. Out of state owners in your target neighborhoods are your customers. 4. Ask for a 3 - 6 month lease with the first months rent due in 60 days. You have to get the property ready and this will only benefit the owner. Can you imagine offering a landlord a free rehab! Yes, it's only paint touch up, new light plate and electrical plates, possible new light fixtures and cleaning, but this only helps the owner and costs you less then $1000! The delay in 60 days to pay rent will allow you 30 days of revenue that will cover prep and repairs. 5. If it's not furnished you can easily furnish a 2 - 3 bedroom apartment very inexpensively. PM me and I will give you places to find everything. I can't give away all my secrets. 6. Advertise the property on Air BnB with high quality pictures and a guidebook is key. Did I mention high quality pictures. Show the owner all you have done and tell him his landlord friends are completely missing out. If your research is correct you should be easily earning 35% clear per month for less then a $2000 investment. Yes, that's highway robbery. It's a great model and always listen to people who are actually doing Air BnB and landlords. Best Regards, Eric
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  • Rental Property Investor · St. Augustine, FL · Member since 2017 · 189 posts · 127 votes
    9y
    I have been in the STR business for a long time - 10 years! Wow, now I feel old! Andy, here are some pointers to get you going and approach other landlords. One on one landlord talks / presentations will be much better then a property manager. Remember, the property manager gets paid through long term rentals and may perceive you as a threat. 1. Contact your friends or colleagues and ask them if you can Air BnB a room or start your business with their help. Once you have a couple stays create a professional web site and business cards. Quality pictures, quality pictures, quality pictures. Go Daddy and a hungry college kid can develop a very professional web site for $100. Business cards are very inexpensive. 2. Contact landlords through any list company like listsource.com. You will mail them directly or call them and you will have more appointments that you can shake a stick at. An original letter that is hard hitting is key. 3. Out of state owners in your target neighborhoods are your customers. 4. Ask for a 3 - 6 month lease with the first months rent due in 60 days. You have to get the property ready and this will only benefit the owner. Can you imagine offering a landlord a free rehab! Yes, it's only paint touch up, new light plate and electrical plates, possible new light fixtures and cleaning, but this only helps the owner and costs you less then $1000! The delay in 60 days to pay rent will allow you 30 days of revenue that will cover prep and repairs. 5. If it's not furnished you can easily furnish a 2 - 3 bedroom apartment very inexpensively. PM me and I will give you places to find everything. I can't give away all my secrets. 6. Advertise the property on Air BnB with high quality pictures and a guidebook is key. Did I mention high quality pictures. Show the owner all you have done and tell him his landlord friends are completely missing out. If your research is correct you should be easily earning 35% clear per month for less then a $2000 investment. Yes, that's highway robbery. It's a great model and always listen to people who are actually doing Air BnB and landlords. Best Regards, Eric
  • Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes
    9y

    @Eric A. thanks for an excellent post!  I'm wanting to try this model in my home market of Los Angeles but the rental market is so hot I think I'll be sorting through a lot of leads before I find a landlord willing to take a (perceived) risk on me vs. a traditional tenant.

    One question - why would a landlord agree to first months' rent due after 60 days?  I presume you've done it or you wouldn't have suggested it, but if I were the prospective LL I'd feel like I was being asked to stick my neck out for 60 days.  How do you propose that in a way that's perceived favorably by the LL?

  • Rental Property Investor · St. Augustine, FL · Member since 2017 · 189 posts · 127 votes
    9y

    Hi Julie,

    You will never know someone's motivation at any particular time. I have spoken to landlords who tell me they wish they would have done this years ago. Others want nothing to do with it. Some landlords perceive a total mess on their hands as a tenant that just departed and the walls need to be painted. You never know what people will agree to unless you ask. 

    I am a "glass half full individual" so I don't let anything deter me. If a landlord says no I simply move on and they may say yes the next time I ask them. To get yourself more comfortable you may ask friends or relatives if you can use your model on one of their properties. Work out the particulars and practice. Then you have a testimonial to use for he next one. Good luck and I'm happy to answer more of your questions. 

    Best Regards,

    Eric 

  • Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
    9y
    Andy O'Neal The money/premium pay will open an ear.
  • Specialist · Indianapolis · Member since 2019 · 29 posts · 2 votes
    7y

    Andy, were you able to sign leases with landlords? I am in the investivation period with this business model. 

  • Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
    7y
    Jaclyn. Although the concept of Arbitrage (above) is a Hot Topic, the concept of Furnishing and leasing out somebody else's property has a lot of pitfalls. Which you can see on some other threads.

    that includes things like taking quite a bit of time to recoup the cost of furnishing the unit, an ever increasing number of other airbnb's that drive down the price, losing the right to the property that you furnished, or local regulation where you have to live in the building, etcetera

    although I prefer to own my properties, a lot of people are now going to the co-hosting model where the landlord furnishes the place and you were more of a manager. Eric Moller runs a company reflecting the change to cohosting. You certainly don't need his product, but he made powerful arguments about the many problems they had with Arbitrage. 

    Originally posted by @Jacklyn P.:

    Andy, were you able to sign leases with landlords? I am in the investivation period with this business model. 

  • Specialist · Indianapolis · Member since 2019 · 29 posts · 2 votes
    7y
    Originally posted by @Ken Latchers:
    Jaclyn. Although the concept of Arbitrage (above) is a Hot Topic, the concept of Furnishing and leasing out somebody else's property has a lot of pitfalls. Which you can see on some other threads.

    that includes things like taking quite a bit of time to recoup the cost of furnishing the unit, an ever increasing number of other airbnb's that drive down the price, losing the right to the property that you furnished, or local regulation where you have to live in the building, etcetera

    although I prefer to own my properties, a lot of people are now going to the co-hosting model where the landlord furnishes the place and you were more of a manager. Eric Moller runs a company reflecting the change to cohosting. You certainly don't need his product, but he made powerful arguments about the many problems they had with Arbitrage. 

    Originally posted by @Jacklyn P.:

    Andy, were you able to sign leases with landlords? I am in the investivation period with this business model. 

    Ken, I will definitely check his business model. Thank you for heads up. 

  • Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
    7y

    True Arbitrage sounds lovely until the world changes. And maybe some markets support it. For now. 

    But owning a well chosen property in a well chosen place has a lot of hidden advantages. A lot of the noise Arbitrage types throw up ignores a lot of harsh realities. 

    I also suggest you study Rented.com

    Airbnb has a co-host function. I do not think booking.com m or VRBO does

    https://www.airbnb.com/help/article/1243/what-s-a-...

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