Author Topic: Lease a apartment, then rent it on Airbnb  (Read 2130 times)

Kaplin261

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Lease a apartment, then rent it on Airbnb
« on: November 12, 2015, 01:00:19 PM »
I was reading another thread on the MMM forums about airbnb, one of members recommended a blog that had a pretty detailed experiment where the owner had a condo that they were renting as a standard rental that they then turned into a airbnb rental. The experiment was to see the differences in income for airbnb rental income vs standard month to month lease. The owner noticed he was earning %50 more on there investment. The example was a $1100 month condo she had been using as a rental property, then when she used it as a airbnb rental her profits went up $500.
http://affordanything.com/2014/05/27/the-airbnb-experiment-how-much-did-i-make/

So why not skip owning the property all together. Lease a condo or house for 12 months,disclose your intentions. Then rent the place on airbnb.

Upfront costs to lease a $1100 month condo for 12 months
$1100 security deposit
$1100 first months rent
$1000 to hire moving company
$2000 worth of household essentials(furniture,dishware,linens etc)

Total
$5,100


For a $500 month income you will manage 1 house cleaner and answer some emails. This seems to simple, what am I missing?

Roboturner

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Re: Lease a apartment, then rent it on Airbnb
« Reply #1 on: November 12, 2015, 01:50:24 PM »
Yeah, there are a few articles of people doing this (usually without the "disclose intentions" which is super scammy imo). The issue is that most contracts will not let you "sublet" your place - so good luck finding a rental that will let you do that. Personally, I would be livid if I owned a property and some jackwagon started renting it out to a bunch of randos on AirBnB.

LadyMaWhiskers

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Re: Lease a apartment, then rent it on Airbnb
« Reply #2 on: November 12, 2015, 03:29:03 PM »
Yeah, there are a few articles of people doing this (usually without the "disclose intentions" which is super scammy imo). The issue is that most contracts will not let you "sublet" your place - so good luck finding a rental that will let you do that. Personally, I would be livid if I owned a property and some jackwagon started renting it out to a bunch of randos on AirBnB.

In sum, it's typically illegal. Only a terribly written lease would permit this, and the statutory law might override the bad lease, making it still illegal.

Kaplin261

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Re: Lease a apartment, then rent it on Airbnb
« Reply #3 on: November 12, 2015, 05:21:03 PM »
Yeah, there are a few articles of people doing this (usually without the "disclose intentions" which is super scammy imo). The issue is that most contracts will not let you "sublet" your place - so good luck finding a rental that will let you do that. Personally, I would be livid if I owned a property and some jackwagon started renting it out to a bunch of randos on AirBnB.

In sum, it's typically illegal. Only a terribly written lease would permit this, and the statutory law might override the bad lease, making it still illegal.

This why I mentioned "disclose your intentions!". I'm sure most property owners would be skeptical and afraid of a radical idea like this, you would have to mitigate their risk and add incentive. A landlord who rents a home in a bad school zone and near a noisy attraction like a race track may not be able to rent his property for very much as a traditional long term lease. However someone who wants to be near the race and needs a place to stay would pay a premium price.

Cherry pick locations that are undervalued and propose the idea. Then offer 20% more to their asking price and double up on the security deposit.

Bearded Man

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Re: Lease a apartment, then rent it on Airbnb
« Reply #4 on: November 12, 2015, 05:44:51 PM »
Aren't you also dealing with more turnover costs? Are those factored into the new profits?

I'd hate to see what ABNB people would do to my C class rental property.