But why calculate the projected ROI manually when there’s an Airbnb Arbitrage Calculator? This powerful calculator is comprehensive and transparent with comps. Therefore, it gives you an accurate and trustworthy simulation of your rental arbitrage ROI! 

It does not deliver overpromising projections. Plus, you can try it for free!

6. Pitch Rental Arbirtage to Multiple Landlords

This is a not-so-well-known fact: Most landlords are not too keen on short-term rentals. If they were, they’d do it themselves, especially since they can outsource Airbnb management. 

Why Landlords May Refuse Rental Arbitrage?

Their lack of interest in Airbnb also includes rental arbitrage. Their concerns on the matter include:

• Lack of Subtenant Screening – You know the drills when it comes to renting. Landlords often do thorough background checks that include criminal history and credit score. Even if you have no problems with these, landlords know you won’t be the permanent resident on their property. Agreeing to your proposal essentially means they’re giving you the responsibility to vet the guests. And you can’t assure them that everyone will treat their property with care. 

• Wear & Tear and Property Damage – Most landlords shoulder the maintenance expenses. Establishing a consistent usage pattern on their property may give them a little peace of mind. This is something that’s not guaranteed in Airbnb arbitrage with multiple guest turnovers.  
• On-Time Payment – Landlords know that the income from Airbnb fluctuates depending on the demand and seasonality trends. In fact, this is among the reasons why they choose traditional, long-term renting. They like the idea of a consistent cash flow, and they know that it might get affected during the low season of your arbitrage.

How To Address Landlords’ Concerns?

The first landlords that you’ll approach may decline your proposal outright. They are not simply not open to the idea of short-term rental. Don’t take the rejection personally, but move forward without letting it affect your confidence. 

Remember when we said that you create a list of properties? We have been encouraging you to cast your net wide. Contacting multiple landlords increases your chance of success!

So, it’ll not always be a losing battle. There are ways that you can address these concerns:

• Plan a Thorough Screening Process – Airbnb hosts have avoided major headaches by simply implementing a stringent screening process. This may include looking at guest reviews, doing a Google search, and verifying the guests’ IDs. Communicate these precautionary steps with your landlord. And be sure to implement them if they agree.
• Shoulder the Repair and Maintenance Costs – The issue with the screening process can be linked to property damage. If there’s serious damage, who will landlords run after? Then, shouldering these expenses is the only way to address this concern. This will put their minds at ease when it comes to preserving the good condition of their property.

Since you will now be responsible for these costs, here are a few ways to minimize risks:

• Set your own Airbnb house rules
• Collect security deposit from guests
• Do regular inspections
• Establish a maintenance and emergency repair fund

• Propose a Long-Term Partnership – Landlords worry about vacancy. Why? Tenancy is the source of their income. But what if you reassure them that you’re in it for the long ride? That sounds like a win-win situation, don’t you think?

The question now is how you can reassure the landlords. Remember the budget in the first step? Rent will be a major part of it. 

A typical lease lasts at least one year. Then, it’s renewable after this period. You cannot simply walk away from a lease agreement. Otherwise, you will be legally responsible to:

• pay a termination fee
• find a substitute tenant
• pay the remainder of your lease

If receiving payment is the major concern of the landlord, you may propose a six-month or one-year payment term. 

We know that may feel like a huge financial burden. Sadly, you still have to spend money to make money. Consider it just a part of a rental arbitrage investment.  You don’t have to suggest this solution upfront, especially if the landlords do not bring this up. But consider this as your Plan B.

Approaching landlords may sound like an intimidating task. But you can act cool in doing so. Watch the video below to see how you can propose Airbnb rental arbitrage with swag!