Self Manage Or Rent to An Arbitrage Company?

Question

BP friends,

My wife and I have a house in Arvada, CO. It's a 5 bed, 4 bath 4000 SF single-family home that we're currently using as a short-term rental. An arbitrage company recently approached me indicating that they'd like to market it as an MTR property and are offering to pay us, per month, about what we're making per month. My first thought was that to be able to make the same amount of $ per month without actively managing it sounds pretty enticing. But, my second thought was that if the arbitrage company is able to generate substantially more per month than I currently do, then why can't I?

We have it listed through RedAwning, a company that markets the property on many of the usual channels - AirBnB, Booking.com, VRBO etc.

The home isn't super close to anything, but is relatively close to a lot of things. Hospitals, Golden CO, Denver CO, Boulder CO, Olde Town Arvada etc. are all within a 20-30 minute drive.

From your experience(s), what else can I be doing to generate more and higher-dollar bookings with this property?

Here's a link to the AirBnB listing

Thanks in advance for any advice from experienced MTR investors.

Neil

Ben Rhodin · Answer

As everyone has already pointed out the simple answer is what is your goal with the property? Are you currently overwhelmed with the amount of work it is to manage? The arbitrage will hopefully provide you the ease of management, but be sure to vet them thoroughly and what incidentals and repairs they will cover, vs what they will come to you for. Also, take a look at the lease they propose and make sure they don't have a termination agreement or something of that nature. The last thing you want is for them to just walk away.

If the property is doing well, and you aren't having much management then why outsource it?

But yes, your property is perfectly suited for the insurance side of MTRs, which pay top dollar. It might be something to explore for yourself. Less management, and you just need to get in with the right agencies. Send me a DM if you want to get some suggestions.

Brett Deas · Answer

I think its great to be able to charge more and not have to deal with tenants. So if they are offering to rent it from you at a higher price than I see no reason why not.

Something I have also learned about the MTR market in Denver, not a lot of travel nurses if you have 2+ bedrooms. Typically traveling medical pro's only travel alone, or with one spouse/pet. Not often do they bring a family. That being said the market for relocating and traveling families is huge. I have only had 2 travelling medical professionals at my MTR's but we get a ton of digital nomads and relocating families. For reference my condo's are 3/2's in Cap Hill.

Karthik Dontula · Answer

I would contract the unit to the arbitrage company and focus on something more lucrative, provided they are a reliable company and paying you what you were making.

Aditya Kohli · Answer

I would also suggest to research a bit more on the arbitrage company to verify their claims and get references from other landlords that they will take good care of your property too

Nicole Heasley Beitenman · Answer

The question is how involved you want to be with your property. Is the extra income worth the extra work to you? If the answer is yes, do it yourself. If it's no, the arbitrage company sounds like a good fit.

Afoma Okwudiafor · Answer

Took a look at your listing, it doesn't seem targeted towards MTR. For one there isn't a full month available. Like Brett said, bigger homes are not typically medical professionals target. You will need to market towards relocating families or displaced families.

Self Manage Or Rent to An Arbitrage Company?

Self Manage Or Rent to An Arbitrage Company?

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