Airbnb has become increasingly versatile as you can find a wide variety of methods to earn via the platform. Airbnb rental arbitrage is one popular avenue to take into account if you intend to build a company on Airbnb and produce a good profit.
Here's how smart entrepreneurs are earning money with Airbnb rental arbitrage and some important things for you to know.
What is rental arbitrage?
“What's Airbnb arbitrage ?” has over one million searches on Google – so you're not alone in asking this question! Simply speaking, Airbnb rental arbitrage is when a number rents a property from a landlord (like renting a regular apartment) and then rents out that apartment as a short-term rental on Airbnb and other channels.
Why Does Airbnb Rental Arbitrage Exist?
People are usually in need of short-term accommodation. In major cities and tourist destinations, hotels can be expensive. Airbnb has filled the gap available in the market by offering less expensive accommodation.
Consequently, with your vacation rental listed on Airbnb at a daily rate that's higher than the property expenses, you may make a tidy sum. However, the system must nevertheless be less than just what a person might pay for a similar room at a hotel in exactly the same area.
How Much Can You Earn with Rental Arbitrage?
Your profit is determined by how many vacation rentals you have and the area they're located in. Rental arbitrage has great potential and by selecting the right business strategy you can earn 2 or 3 times significantly more than you actually spend in your property.
For instance, if your monthly rent is $1,500 you are able to rent out your property for $350 on weekends only. By having your guests for 10 weekends, you'll be able to earn $3,500. You'll be able to pay for your rent and have $2,000 to cover expenses and still be able to grow your business.
If you manage more than one property or rent them out more regularly than simply on weekends, your income will be much higher. A well-thought-out pricing strategy will also enable you to earn more while providing exactly the same level of service to your guests.
Conclusion
Making money with Airbnb arbitrage gets very popular as that you don't need your can purchase a property becoming a host. By conducting thorough market research and obtaining all the required permission, you will be able to fund your rent and get a chance becoming a prosperous full-time host.
To improve your company and elevate the guest experience, you are able to go one step further and automate your business. Saving more hours on routine operations will open more opportunities for growing your business and, consequently, your vacation rental income.
