Updated almost 5 years ago on . Most recent reply
Airbnb start up what should I do to get started?
I’m a 21 years old college student looking to get started in the Airbnb Rental Arbitrage business I know exactly what I need to do and how to do everything to get started but I don’t have that start up capital which others have told me is about 6,000. What steps should I take in order to get started? Do I save up as much as I can? Or take out a business loan or use credit ?
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The arbitrage model is definitely doable, but you will not find many doing it on this forum. I can get into an arbitrage deal quicker and cheaper than buying a house and self-managing it, but I am missing out on so many benefits of actually investing in real estate. To start, its a great hedge against inflation, which is coming, there's principle paydown, the appreciation of the property, the massive tax benefits, the increase in equity and net worth as each year goes by and the ability to use leverage (loans) to grow.
Like Michael said above, what's your exit strategy? The arbitrage model is not real estate investing, its a job. You'll pay a lot in taxes and you get none of the benefits of real estate investing besides some income. Almost every 21 year old does not have the business acumen to successfully scale an arbitrage business to make it really work.
If you're 21, read a few BP books and figure out what model of actual real estate investing you want to get into. If you're attracted to STR, find a way to combine the two. Maybe find a part of your city that is prime for STR, buy a duplex at 3.5% down, live in one half and try your hand at throwing the other half on a STR. If that fails to bring in as much money as you'd like or is too much work for you, rent it out to a long term tenant. Third option, or exit strategy, would be to sell the duplex.
Think of your 30's and 40's when you're 21 and not your early 20's. You can still have income in your 20's while setting yourself up for a prosperous adulthood.
Read the book, "The House Hacking Strategy" by Craig Curelop, then read a few other beginner BP books. Read, listen to the audiobook, watch an hourlong BP webinar on Youtube. After that, and you still think the arbitrage model is the best route, more power to you and I wish you the best. Any information you would need to learn how to successfully implement that model is on Youtube and in this forum, anyways.