One of the most common questions I get from people looking to use Airbnb is whether they can set up rental arbitrage. The idea behind Airbnb rental arbitrage is simple: you rent out properties that other people own on Airbnb and get paid for doing so. This type of Airbnb business comes with its share of risks, but it can be profitable if done correctly.
You can make money with Airbnb rental arbitrage. Some people use it to supplement income from another job — for example, one of the authors of this series uses it to help pay down student loans. Other people use Airbnb rental arbitrage as their full-time job. Either way, it’s a valid alternative to more traditional ways of making money by buying and holding properties or renting properties.
Airbnb Rental Arbitrage
Airbnb rental arbitrage is different from buying stocks on margin or opening a small business. For example, you can open a hotel or inn with the exclusive purpose of renting out rooms and apartments through Airbnb without going through any complicated legal procedures. You can even gather a group of friends and acquaintances and become hosts under your establishment using the Airbnb model.”
Airbnb rental arbitrage can be a lucrative way to make money, but it won’t be easy. First, you need to find the right property and determine how much you will charge per night. You’ll also have to present your case to the current homeowner, considering that they could be against your plan. With all this in mind, there are easy ways to do Airbnb rental arbitrage, and with a little bit of work on your part, you can get it done!
Subletting a property or rental arbitrage. Is it legal?
Arbitrage is the practice of purchasing securities on one exchange to simultaneously sell them on another, profitably exploiting the difference in prices between the two exchanges, and investors can do it with real estate, too.
Airbnb rental arbitrage is legal, depending on the short-term rental regulations where you live. So do your research first. Short-term rental laws are evolving in most large cities across the world. You’ll want to make sure that rental options like Airbnb are allowed in the city you’re interested in or that there isn’t a limited number of nights annually; you can rent out to guests. If vacation rentals are allowed in your area, you’ll also have to check if your city, township, state, or province will require you to apply for a hospitality license.
But remember, Airbnb rental arbitrage is not always legal. Before getting started, make sure that the property you are subletting from your landlord is allowed to be used for short-term and vacation rental arbitrage. Some property owners don’t let this.
