1 hr 7 min
045 | Airbnb Investing and STR Strategies - Part 2 | What Happened to FTX? | Choosing a Career Path Dollars and Hops
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- Investing
Money Hack of the Week: 30 Day financial audit / challenge - put in spreadsheet/categorize it
What type of investor are you?
Co-host- someone who is managing someone else’s property and is taking a management fee. Management fees are typically between 25-35% and you manage marketing, guest communication, cleaners, maintenance, etc….
Great way to have a side hustle that is super flexible in nature. Generally when a property is automated, it only takes 2-4 hours a week to manage the property.
Rental Arbitrage- Rent from a landlord and sublease on Airbnb to guests.
Downsides are - landlord can terminate lease and Upfront cost of furnishing without guarantee of long term lease
Buy and Hold - buying a house/condo/apt and renting it out on Airbnb. Capture the long term appreciation and the short term cash flow.
General:
Invest in a training program. This is truly a business - learn from someone who has already done it. It may cost you $1k to $2k to buy into a coaching program, but it’s 100% worth it. It will dramatically expedite the learning process.
Make sure the local county and city allow short term rentals
Avoid HOA’s if possible as they could ban STR’s.
Look for unique homes
Evaluating an investment property:
Have an investment analysis spreadsheet - can get these from others for free online
With this spreadsheet, it will take an all encompassing view of all the expenses you need to think about when operating a short term rental.
Will include mortgage, set up costs, down payment, monthly maintenance, utilities, trash, TV, Internet, HOA, Landscaping, etc…
Air DNA, STR insights, Data Rabu
These are tools that scrape the data from Airbnb/VRBO and forecast how current and active STR’s are doing that are on the market. This can help you get a gauge on what is possible from a revenue standpoint.
Help to forecast how much a home can make on Airbnb
Cash on cash return:
Using an investment analysis spreadsheet, calculate your cash on cash return - this is the number of years it will take to get your money invested back. Typically - 25% or better is a good cash on cash return. That would mean you would get all your money back on the investment within 4 years, and then from there you’re just making profit.
Money Hack of the Week: 30 Day financial audit / challenge - put in spreadsheet/categorize it
What type of investor are you?
Co-host- someone who is managing someone else’s property and is taking a management fee. Management fees are typically between 25-35% and you manage marketing, guest communication, cleaners, maintenance, etc….
Great way to have a side hustle that is super flexible in nature. Generally when a property is automated, it only takes 2-4 hours a week to manage the property.
Rental Arbitrage- Rent from a landlord and sublease on Airbnb to guests.
Downsides are - landlord can terminate lease and Upfront cost of furnishing without guarantee of long term lease
Buy and Hold - buying a house/condo/apt and renting it out on Airbnb. Capture the long term appreciation and the short term cash flow.
General:
Invest in a training program. This is truly a business - learn from someone who has already done it. It may cost you $1k to $2k to buy into a coaching program, but it’s 100% worth it. It will dramatically expedite the learning process.
Make sure the local county and city allow short term rentals
Avoid HOA’s if possible as they could ban STR’s.
Look for unique homes
Evaluating an investment property:
Have an investment analysis spreadsheet - can get these from others for free online
With this spreadsheet, it will take an all encompassing view of all the expenses you need to think about when operating a short term rental.
Will include mortgage, set up costs, down payment, monthly maintenance, utilities, trash, TV, Internet, HOA, Landscaping, etc…
Air DNA, STR insights, Data Rabu
These are tools that scrape the data from Airbnb/VRBO and forecast how current and active STR’s are doing that are on the market. This can help you get a gauge on what is possible from a revenue standpoint.
Help to forecast how much a home can make on Airbnb
Cash on cash return:
Using an investment analysis spreadsheet, calculate your cash on cash return - this is the number of years it will take to get your money invested back. Typically - 25% or better is a good cash on cash return. That would mean you would get all your money back on the investment within 4 years, and then from there you’re just making profit.
1 hr 7 min