Apparently, dude’s been doing Airbnb for five years now. During that time, he’s made over $4 milli, between the booking revenue and appreciation on the properties. “And in the last year alone, just on the booking revenue, we did $474,000,” he says. “And in the coming year, I wanna do a lot more with Airbnb. And I wanna share with you some of the things that you need to watch out for if you’re planning on growing your Airbnb business this year.”
The way Ryan sees it, Airbnb’s still one of the best ways to break into the real estate game. You can get around a lack of money and credit by doing cohosting or rental arbitrage, where you’re listing other people’s properties. Granted, you’ll have to furnish the place, and maybe pay first and last month’s rent if you’re subleasing, so you’ll still need a good $10- to $15k. But you can go sign up for some 0% interest business credit cards, leverage those to launch, then pay ’em off when you start cash flowing.
“Assuming you’re doing the right research,” Pineda says, “one Airbnb could make you thousands of dollars of net cash flow every single month. And so you could recoup that initial investment of the furniture and everything else within the first six months if you do it right. And to be completely honest with you, as somebody who flips and wholesales, doing this is a thousand times easier than getting your first wholesale or flip deal. Just finding a landlord who’s willing to let you sublease?”
“That’s not hard at all,” he laughs. “So I really like it as an entry-level way to get into real estate investing and start making money fast. The second thing you need to know about Airbnb that I’m excited about is the growth of monthly rentals. So when I got on Airbnb five years ago, I first started thinking I was gonna just rent for two days minimum, people would come on the weekends, and that was how I was gonna make money. But then I realized people were willing to rent for single days.”
So Ryan opened up weekdays and started knocking down one-day bookings as well. It made him more money but the houses were getting worn out faster as well. Plus, there’s more manual work in dealing with the extra bookings, customer support, cleaning up after people, et cetera. Which is why Ryan was tickled pink to hear people were having success listing places with a 30-day minimum stay. Think about how much simpler that is. One tenant, and boom, you’re good for the month. Another advantage? Thirty-day rentals are legal almost everywhere. Not the case with short-term rentals, is it?
Which segues nicely to the third thing Ryan wants you to know about Airbnb this year. “And that is to know your local laws,” he warns. “Like in Big Bear where I have most of my short-term Airbnb listings, the laws are constantly changing. When I first started there was basically no restrictions. Then they banned self check-in. Then they said you could only own one property per person. Luckily, I got grandfathered in before that law was passed. But now, there’s all these laws in the pipeline that could potentially shut things down. Point being, whatever market you’re on, ya gotta know what’s happening locally.”
Last but not least, and this isn’t self-serving at all, but Ryan says ya gotta get a mentor. There’s too many moving parts. What market to be in, which supplies will you need, how ’bout contracts? And what about optimizing your listings and managing reviews and getting Trevor, who should’ve never taken that Ambien when he had been drinking all day, to shut the hell up because the neighbors just called and they were livid? Okay, fine, there is a lot to know and it probably wouldn’t be a bad idea to invest in a coach.