Long Term Rental v.s. Sublet & Airbnb (what should I do?)

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Long Term Rental v.s. Sublet & Airbnb (what should I do?)

Jackson Harris III
Member since 2020 · 4 posts · 0 votes

I have a family member with a home in Suisun City, CA. It is a 3 bedroom 2.5 bath house that we would like to find a long-term renter to pay around 2400-2900/month in rent ($2600 is our target goal/listing price). I will receive $200/month (roughly 8%) of the rent each month for helping them list the property, run a background check, etc. My family member will manage any repair calls, maintenance, etc.

The family member is open to me renting the property from them for 2400/month and is okay with me listing it on Airbnb. I would need to fully furnish it and it is missing a refrigerator, (washer and dryer too). I have about $10k to put towards the project to get it ready to list.

What should I do? Take the $200/month and call it a day, or put in the additional leg work to get it set up as an Airbnb/Vrbo short-term rental?

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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    5y

    What does your research show you that you can get - per night - listing it as a STR?

    And how many days a month does your research show you that it is likely to be rented?

    If it will rent for $300 a night for 20 nights a month ($6000) then there is your answer.......

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  • Paul Sandhu
    Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
    5y

    There is a lot more work than just listing it on Airbnb and putting in some appliances. You might be in over your head if you do the STR route. Who is going to clean/restock it between occupancies?

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  • Jackson Harris III
    OP
    Member since 2020 · 4 posts · 0 votes
    5y
    Originally posted by @Bruce Woodruff:

    What does your research show you that you can get - per night - listing it as a STR?

    And how many days a month does your research show you that it is likely to be rented?

    If it will rent for $300 a night for 20 nights a month ($6000) then there is your answer.......

    Here is a screenshot of the Airdna data. Based on the 29% (9 days/month) and $265 nightly rate I would be around ~ -$350/month, but 1-2 days better than that or booking at above the bottom average daily rate would be profitable.


    Originally posted by @Paul Sandhu:

    There is a lot more work than just listing it on Airbnb and putting in some appliances. You might be in over your head if you do the STR route. Who is going to clean/restock it between occupancies?

    I've looked into how to build a team of "Airbnb Avengers", similar to assembling a team for my long-distance long-term rental purchase. There are some apps and devices to help automate things and worst case I live 45min away. I know the "work" is a lot more hands-on, a lot let "passive" than having a company manage my long-distance property but seeing as the potential returns are higher. My goal is to test this out under a sublet condition rather than to buy a property and attempt something like this without having gone through the trenches so to speak.

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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    5y
    Originally posted by @Jackson Harris III:
    Originally posted by @Bruce Woodruff:

    What does your research show you that you can get - per night - listing it as a STR?

    And how many days a month does your research show you that it is likely to be rented?

    If it will rent for $300 a night for 20 nights a month ($6000) then there is your answer.......

    Here is a screenshot of the Airdna data. Based on the 29% (9 days/month) and $265 nightly rate I would be around ~ -$350/month, but 1-2 days better than that or booking at above the bottom average daily rate would be profitable.

    If AirDNA's data is accurate then that may be a good investment. Have you done your OWN research to see what that shows?

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  • Bill Cereske
    Investor · South Lake Tahoe, CA · Member since 2017 · 78 posts · 42 votes
    5y
    Is there anything in Suisun City that would attract STR guests?  That is the question.
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  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    5y

    @Jackson Harris III

    You're asking if you should get into the STR arbitrage business. There are many discussions about this on this forum. If you research it you'll get all the reasons for each side.

    Private Mortgage Financing Partners, LLC
    WebsiteView Page
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  • Jackson Harris III
    OP
    Member since 2020 · 4 posts · 0 votes
    5y
    Originally posted by @Bill Cereske:
    Is there anything in Suisun City that would attract STR guests?  That is the question.

    It's 30 min from Travis AFB, Napa Valley, Six Flags, a few Nature destinations, and a harbor for smaller boats.

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