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Airbnb Rental Arbitrage All About Airbnb

Rental Arbitrage Spain

rental arbitrage spain


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    What is Rental Arbitrage?

    Rental Arbitrage is a method similar to house hacking, however, the only difference is that you don’t own the house. Instead, you convince a landlord to lease you a property which will be furnished and subleased on Airbnb and VRBO.

    Rental Arbitrage is a smart technique to earn money in any type of property including a multifamily house, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If you own a duplex or triplex then it is pretty straightforward and easy. You can live in one section and rent out the other – which is also known as house hacking. People use this after taking a loan on a property and use the rent to pay off the mortgage. The short-term rental income helps you pay for the long-term lease that you have on the house. This helps you keep the difference at the month-end after paying for the long-term lease.

    Assume you are renting a duplex in Spain for €1,800/month. You are living by yourself on one of the sides and you decide to sublease the other on Airbnb. Let’s say you listed it for €100/day and got 80% occupancy. This will bring in approx €2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

    Learn everything you need to know about the Airbnb Rental Arbitrage business and stand out among your competitors!

    Things to do before getting started?

    How to convince the landlord

    Let’s say you want to get into Rental Arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb data analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your Rental Arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

    You need to be prepared and well researched, good communication skills come in handy here. Also, one thing to always keep in mind: never sublease without informing the landlord, there will be a huge number of people coming in and going out when you’re sub renting, it will not be hard for the landlord to figure out that you are subletting and you might end up getting in trouble.

    For the convincing, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

    Points to tell an indecisive landlord.
    • Doing Rental Arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income. They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income till their property is well maintained. This brings us to our next point.
    • You are more likely to take care of the house than a normal renter. As you are using the property to do business you will take good care of it to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
    • You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of a landlord.

    In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties.

    Ensure the Property and Gain landlords trust

    Being on the safe side is always a good idea. From trouble guests to bothering landlords. You need to make sure you are using the right tools to ensure the property is safe and neighbours are happy. Many landlords will have this concern when renting out their property to you. They will be worried about neighbours raising noise complaints. It is a legitimate concern. To help you with all these problems, here are some suggestions that you can implement and have peace of mind.

    • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
    • Auto host – Automatically screens problematic tenants.
    • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
    • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
    • Airbnb Investment Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

    You can integrate the majority of these tools with a PMS of your choice.

    Airbnb data

    Pro’s and Con’s
    rental arbitrage pros and cons

    The initial cost of starting Rental Arbitrage Spain?

    You can expect to spend anywhere between €3,000 to €5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

    But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do Rental Arbitrage for even less than this depending upon your situation and the type of property you lease.

    Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

    But this doesn’t mean Rental Arbitrage can be done with zero or very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during off-season in case bookings don’t happen right away.

    Expense 1: Rental Deposits

    A rental deposit is going to be one of the first and major expenses. You would need money to be able to sign a long-term lease with the landlord. Therefore, you will need a security deposit, along with your payment for the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

    Expense 2: Furnishing

    Most of the time you should always aim to lease a place that is semi-furnished. As someone with a fully furnished home might be doing short-term rentals themselves. Also furnishing a place from scratch can add anywhere from €3,000 to €5,000 to your initial capital.

    If the place is semi-furnished, then your best bet is to shop for cheap stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

    Expense 3: Photography

    Do it yourself! iPhones have good cameras. DIY photography will save you some money.

    Expense 4: Cleaning Services

    This is included in the starting costs, but you will eventually end up spending on cleaning services. The best way to save money is to do it yourself initially if you have the skills and experience.

    If you have no experience or you don’t want to invest time in cleaning a place. Then your best bet will be to hire a professional cleaner. This can cost you anywhere from €50 to €250 depending upon the size and location.

    Expense 5: Legal Consultation

    Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

    They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

    how much can you make on airbnb
    Check Short Term Rental Data for Your City

    Legality and Regulations in Spain

    To set up short-term rentals in most Spanish autonomous communities, property owners need a specific license. This permit certifies that a flat or home is properly equipped and meets all legal sanitary standards.

    In most autonomous communities, short-term single-room occupancy is forbidden. Property owners who rent out short-term tourist accommodations must get a license. The following are the requirements for holiday rentals that require a license:

    • residential property
    • rented out to visitors for short periods of time (from a few days to one or two months) 
    • rented through booking systems 
    • marketed on specialized websites, platforms, and applications (e.g., Airbnb, TripAdvisor, VRBO, etc).

    Property owners in Spain must have a certificate of occupancy issued when the building is placed into operation to obtain this license. They must also fulfill certain ventilation, air conditioning, hot water, fire safety, and furniture requirements.

    In addition, the landlord must carry insurance that covers things like tenant health and injuries, property damage, and break-ins.

    Region Specifics-

    Except in Castilla La Mancha, Castile and Leon, La Rioja, Murcia, and Extremadura, obtaining a short-term rental licence is required. Authorities are preparing to enact similar measures in that country as well. The autonomous community determines the licensing rules for this activity.

    Owners who break local laws face a fine set by each autonomous town. It spans from €2,000 to €150,000 in Andalusia, and from €9,000 to €90,000 in Barcelona. At the end of each year, owners must report their rental revenue to local tax authorities as well as their home nation.

    Reference | Tranio

    Best areas for Rental Arbitrage Spain

    1. Gràcia

    Rental Arbitrage Spain

    According to our Airbtics Dashboard, Gràcia is the top market to start your Rental Arbitrage business. There are more than 889 Airbnb listings with 267 private rooms properties and 186 one-bedroom properties. The monthly revenue for most properties is more than $3,489/month with occupancy being more than 83%.

    2. Malasaña

    https://app.airbtics.com/airbnb-data/0/0/malasa%C3%B1a,%20madrid

    According to our Airbtics Dashboard, Malasaña is the second-best market to start your Rental Arbitrage business. There are more than 982 Airbnb listings with 456 private rooms properties and 167 one-bedroom properties. The monthly revenue for most properties is more than €2,597/month with occupancy being more than 80%.

    To see full data of Spain- Click Here

    FIND STATS FOR YOUR CITY – CLICK HERE

    Read More – Rental Arbitrage Australia

    Airbtics
    Sign Up for Demo
    Categories
    Airbnb Rental Arbitrage All About Airbnb

    Rental Arbitrage Miami

    rental arbitrage miami


    Table of Contents
      Add a header to begin generating the table of contents

      What is Rental Arbitrage?

      Rental Arbitrage is a method similar to house hacking, however, the only difference is that you don’t own the house. Instead, you convince a landlord to lease you a property which will be furnished and subleased on Airbnb and VRBO.

      Rental Arbitrage is a smart technique to earn money in any type of property including a multifamily house, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If you own a duplex or triplex then it is pretty straightforward and easy. You can live in one section and rent out the other – which is also known as house hacking. People use this after taking a loan on a property and use the rent to pay off the mortgage. The short-term rental income helps you pay for the long-term lease that you have on the house. This helps you keep the difference at the month-end after paying for the long-term lease.

      Assume you are renting a duplex in Miami for $1,800/month. You are living by yourself on one of the sides and you decide to sublease the other on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will bring in approx $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

      Do you want consistent cash flow? Read this article about the Rental Arbitrage business and become a pro!

      Things to do before getting started?

      How to convince the landlord

      Let’s say you want to get into Rental Arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb data analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your Rental Arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

      You need to be prepared and well researched, good communication skills come in handy here. Also, one thing to always keep in mind: never sublease without informing the landlord, there will be a huge number of people coming in and going out when you’re sub renting, it will not be hard for the landlord to figure out that you are subletting and you might end up getting in trouble.

      For the convincing, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

      Points to tell an indecisive landlord.
      • Doing Rental Arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income. They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income till their property is well maintained. This brings us to our next point.
      • You are more likely to take care of the house than a normal renter. As you are using the property to do business you will take good care of it to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
      • You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of a landlord.

      In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties.

      Ensure the Property and Gain landlords trust

      Being on the safe side is always a good idea. From trouble guests to bothering landlords. You need to make sure you are using the right tools to ensure the property is safe and neighbors are happy. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints. It is a legitimate concern. To help you with all these problems, here are some suggestions that you can implement and have peace of mind.

      • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
      • Auto host – Automatically screens problematic tenants.
      • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
      • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
      • Short-term Rental Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

      You can integrate the majority of these tools with a PMS of your choice.

      Airbnb data

      Pro’s and Con’s

      rental arbitrage pros and cons

      What is the initial cost of starting rental arbitrage in Miami?

      You can expect to spend anywhere between $3,000 to $5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

      But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do Rental Arbitrage for even less than this depending upon your situation and the type of property you lease.

      Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

      But this doesn’t mean Rental Arbitrage can be done with zero or very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during off-season in case bookings don’t happen right away.

      Expense 1: Rental Deposits

      A rental deposit is going to be one of the first and major expenses. You would need money to be able to sign a long-term lease with the landlord. Therefore, you will need a security deposit, along with your payment for the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

      Expense 2: Furnishing

      Most of the time you should always aim to lease a place that is semi-furnished. As someone with a fully furnished home might be doing short-term rentals themselves. Also furnishing a place from scratch can add anywhere from $3,000 to $5,000 to your initial capital.

      If the place is semi-furnished, then your best bet is to shop for cheap stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

      Expense 3: Photography

      Do it yourself! iPhones have good cameras. DIY photography will save you some money.

      Expense 4: Cleaning Services

      This is included in the starting costs, but you will eventually end up spending on cleaning services. The best way to save money is to do it yourself initially if you have the skills and experience.

      If you have no experience or you don’t want to invest time in cleaning a place. Then your best bet will be to hire a professional cleaner. This can cost you anywhere from $50 to $250 depending upon the size and location.

      Expense 5: Legal Consultation

      Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

      They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

      how much can you make on airbnb
      Check Short Term Rental Data for Your City

      Legality and Regulations in Miami

      There are a variety of state, county, and city requirements and regulations to follow when operating a short-term rental in Miami and Miami Beach. The following is a detailed breakdown of the short-term rental regulations in Miami-Dade County, as well as the cities of Miami and Miami Beach.

      Miami Dade County

      • A Certificate of Use from Miami-Dade County is required to run a short-term rental in the county.
      • The Certificate of Use in Miami-Dade is valid for one year and can be renewed annually as long as all conditions are still completed and there are no outstanding fines or liens for violations of the County Code in Miami-Dade.
      • The responsible party or host must reside in the short-term rental property for more than six months per calendar year for properties in designated Estate or Low-Density Residential regions.
      • When a property is utilized as a vacation rental, the CU must be posted in a prominent position within the vacation rental that is readily accessible to visitors and must include, at a minimum, the name, address, and phone number of the responsible party as well as the vacation rental’s maximum occupancy.
      • The responsible party or host must reside in the short-term rental property for more than six months per calendar year for properties in designated Estate or Low-Density Residential regions.
      • Along with zone restrictions, the responsible party of a short-term rental must keep a register of all guests’ identities and dates of stay, which the Miami-Dade county can review.

      North Beach short-term rentals

      Short-term rentals are strictly prohibited at North Beach, although they may be permitted if certain conditions are met. Reservations for the full home for a minimum of seven nights are permitted in this region. They must also pay resort taxes. In addition to these requirements, a fee of $1,000 is required to apply for a Certificate of Use for running short-term rentals in North Beach.

      Reference | Keycafe | Guestable

      Best areas for Rental Arbitrage Miami

      1. Little Havana

      rental arbitrage miami little havana

      According to our Airbtics Dashboard, Little Havana is the top market to start your Rental Arbitrage business. There are more than 18,589 Airbnb listings with 3,911 private rooms properties and 5,821 one-bedroom properties. The monthly revenue for most properties is more than $4,842/month with occupancy being more than 65%.

      2. Little Haiti

      rental arbitrage miami little haiti

      According to our Airbtics Dashboard, Little Haiti is the second-best market to start your Rental Arbitrage business. There are more than 3,351 Airbnb listings with 607 private rooms properties and 1,022 one-bedroom properties. The monthly revenue for most properties is more than $4,768/month with occupancy being more than 62%.

      To see full data of Miami – Click Here

      Find Stats for your City – CLICK HERE

      Read More – Rental Arbitrage Australia

      Airbtics
      Sign Up for Demo
      Categories
      Airbnb Rental Arbitrage All About Airbnb

      Rental Arbitrage United Kingdom

      Rental Arbitrage United Kingdom

      Rental Arbitrage United Kingdom

      Table of Contents
        Add a header to begin generating the table of contents

        Introduction

        Real estate properties in the United Kingdom are one of the most coveted in the world. This jacks up the cost of rent, especially in its major cities.  But what if we tell you that you can augment your income by renting out a property without actually owning it? Rental arbitrage enables this setup. It is a smart way to earn passive income with only minimal investment!

        In this guide, we’ll explain rental arbitrage in layman’s terms and provide some expert tips. We also included the best areas to do rental arbitrage in the UK to help you make the best investment decisions. Stoked to learn more? Continue reading!

        What is Rental Arbitrage?

        Rental Arbitrage is a method similar to house hacking, where you rent out a spare room in your property. The difference between these two is you don’t need to own the house in rental arbitrage. Instead, you convince the property owner to allow you to sublease the house on Airbnb and VRBO.

        Rental arbitrage in the UK is applicable to any type of residential real estate. These can be multi-room apartments, houses, condo units, duplexes, and triplexes. It is a smart way to add a stream of income through the short-term rental of your subtenants. This allows you to pay your own rent and earn more. 

        Assuming you are renting a duplex in the United Kingdom £1,500/month. You are living by yourself on either side and you decide to sublease the other on Airbnb. Let’s say you listed it for  £87/day and got 80% occupancy. This will bring in approximately £2,250 per month in revenue. Not only will it fully cover your rent, but it will give you a profit of  £800. This, in a nutshell, is called rental arbitrage.

        Learn more about Rental Arbitrage Methods in this ultimate guide!

        Is rental arbitrage legal in the UK? 

        Yes, rental arbitrage is legal in the United Kingdom but regulations vary per city. Here are some city-specific Airbnb regulations:

        1. Greater London

        Short-term rentals are subject to planning limitations. According to Airbnb rules in London, a property can be classified as “temporary sleeping accommodation” if it is rented for less than 90 nights per year. However, the “90-night limit” is not used by every local planning authority. Therefore, owners must check if short-term rentals are allowed in their areas for rental arbitrage in London. 

        2. Edinburgh and Glasgow

        Property owners must need to get planning approval to convert their residential premises to short-term rentals according to their respective City Councils. For instance, planning permission is required to change a host’s residential dwelling to a short-term visitor accommodation in Edinburgh. This approach is the same as Airbnb rules in Glasgow.

        3. Northern Ireland

        Northern Ireland has recently passed short-term rental guidelines. One of which is requiring the host to obtain an official tourism certificate to start a short-term rental business. 

        How do I get started with rental arbitrage?

        1. Convince the landlord

        Let’s say you want to get into rental arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your rental arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

        You need to be prepared and well-researched about the Airbnb demand in your area. Good communication skills will also come in handy here. Another thing to always keep in mind: never sublease without informing the landlord! There will be a huge number of people coming in and out when you’re sub-renting. It will only be a matter of time before the landlord figures out what you’re up to, and you might end up getting in trouble. 

        For convincing the landlord, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

        Points to tell an indecisive landlord
        • Doing rental arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income.
          They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income until their property is well maintained. This brings us to our next point.
        • You’ll take care of the house better than a normal renter. As you are using the property for Airbnb, you will maintain it very well to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. 
          Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
        • You can ensure timely monthly rent. You can tell the landlord that doing rental arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of the landlord.

        In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties. You can also use a free rental arbitrage email template and propose your ideas to landlords!

        2. Ensure the Property and Gain the landlord’s trust

        Being on the safe side is always a good idea. Use the right tools to ensure the property is safe, and the neighbors can go on with their lives happily while you do rental arbitrage. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints, and it’s a legitimate concern. To help you with all these problems, here are some suggestions that you can implement: 

        • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
        • Auto host – Automatically screens problematic tenants.
        • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
        • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
        • Airbnb Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

        Pros and Cons

        Be prepared for what you can expect from rental arbitrage in the United Kingdom:

        • Pros
          • No purchase of property required
          • Low upfront costs
          • Opportunity to repeat and scale easily
          • Generate profit for other investments or business
        • Cons
          • Invest money and time in furnishing the property

        AIRBNB OCCUPANCY RATES IN CITIES OF THE UNITED KINGDOM?

        We conducted in-depth research & utilized our Airbnb occupancy rate calculator to feature the occupancy rates of major cities!

        how much can you make on airbnb

        How much do I need to start Airbnb arbitrage? 

        You can expect to spend anywhere between £3,000 to £5,000. This cost includes deposit, furnishing, amenities, legal paperwork, and LLC Incorporation.

        But doesn’t this contradict the low upfront cost of rental arbitrage? Well, these estimates vary from city to city. There is a possibility to do rental arbitrage for even less than this depending upon your situation and the type of property you lease.

        Still, the amount is much less than investing in a new property and getting a mortgage of thousands of dollars. Plus you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

        But this doesn’t mean that rental arbitrage can be done with zero or on a very tight budget. There will be some upfront costs that you will have to prepare for by having some extra cash on hand. It will help pay off the lease during the off-season.

        Expense 1: Rental Deposits

        A rental deposit is going to be your first major expense. You will need money to be able to sign a long-term lease with the landlord. For that, you will need a security deposit for your first and previous month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

        Expense 2: Furnishing

        Ideally, you should aim to lease a place that is semi-furnished. Furnishing a place from scratch can add anywhere from £3,000 to £5,000 to your initial capital. Not choosing the right property can make rental arbitrage not so low cost, so choose wisely.

        If the place is semi-furnished, then your best bet is to shop cheap for the rest of the stuff. You can go and find cheap supplies from places like B&Q and IKEA. Sometimes, even ASDA can have a hidden gem if you look closely.

        Expense 3: Photography

        It’s highly recommended to try DIY photography as a start to save money. You can even learn how to take the best Airbnb photos to highlight your listing! But if you have the budget, hiring a professional photographer is also an excellent option. 

        Expense 4: Cleaning Services

        This is not a starting cost, but you will end up spending on cleaning eventually. The best way to save money is to do it yourself initially if you have the skills and experience.

        If you have no experience or you don’t want to invest time in cleaning a place, then your best bet will be to hire a professional cleaner. This can cost you anywhere from £50 to £250 depending upon the size and location.

        Expense 5: Legal Consultation

        Maintaining a professional relationship with a real estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

        They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

        Best areas for Rental Arbitrage in the United Kingdom

        Some of the obvious places that come to mind when thinking of the United Kingdom are  Northern Headquarters, Baltic Triangle, and China town. Let’s take a look at two of the best areas to do rental arbitrage in the UK:

        1. JERICHO
        Rental Arbitrage United Kingdom

        Airbtics Dashboard shows that Jericho is the top market to start your Airbnb arbitrage in the UK. There are more than 101 Airbnb listings in Jericho with an average annual revenue of £49,927 and an occupancy rate of 93%.

        2. EDINBURGH NEW TOWN
        Rental Arbitrage United Kingdom

        Airbtics Dashboard presents  Edinburgh New Town as the second-best market to start your Airbnb rental arbitrage business. The area has 502 Airbnb listings that can generate an average annual revenue of  £56,522 with an 87% occupancy rate. 

        Conclusion

        In summary, rental arbitrage in the UK can be a very profitable side income. Since it does not require you to purchase a property, it’s also practical for beginners trying to be real estate players without spending millions.

        Leverage your rental arbitrage opportunities by using a free Airbnb Calculator and determine the best areas that will bring long-term profitability!

        Categories
        Airbnb Rental Arbitrage All About Airbnb

        Rental Arbitrage Australia

        Introduction

        Australia consistently ranks in the top ten most expensive countries to live in. But what if we tell you that you can augment your income by renting out a property without actually owning it? Rental Arbitrage enables this setup. It is a smart way to earn passive income with only minimal investment!

        In this guide, we’ll explain rental arbitrage in layman’s terms and provide some expert tips. We also included the best areas to do rental arbitrage in the Australia to help you make the best investment decisions. Stoked to learn more? Continue reading!

        What is Rental Arbitrage?

        Rental Arbitrage is a method similar to house hacking, where you rent out a spare room in your property. The difference between these two is you don’t need to own the house in rental arbitrage. Instead, you convince the property owner to allow you to sublease the house on Airbnb and VRBO.

        Rental Arbitrage in Australia is applicable to multi-room apartments, houses, and condo units – as well as duplexes, and triplexes. It is a smart way to add a stream of income through the short-term rental of your subtenants. This allows you to pay your own rent and earn more. 

        While Airbnb occupancy rates in Australia vary per city, it’s important to know that rental arbitrage in this country is certainly recovering from the global pandemic’s effects. For instance, the highest occupancy rate and monthly revenue in Darwin can assure an average host to earn AUD $4,520 for a 1 bed/1 bath apartment condo.

        Assuming you are renting a duplex in Sydney for AUD $1,800/month. You are living by yourself on either side and you decide to sublease the other on Airbnb. 

        Let’s say you listed it for AUD $100/day and got 80% occupancy. This will bring in approximately AUD $2,600/month in revenue. Not only will it fully cover your rent, but it will give you a profit of AUD $800. This, in a nutshell, is called Rental Arbitrage.

        If you want to learn more, let this Ultimate Guide About Rental Arbitrage answer all your inquiries!

        What is Rental Arbitrage?

        Rental Arbitrage is a method similar to house hacking, where you rent out a spare room in your property. The difference between these two is you don’t need to own the house in rental arbitrage. Instead, you convince the property owner to allow you to sublease the house on Airbnb and VRBO.

        Rental Arbitrage in Australia is applicable to multi-room apartments, houses, and condo units – as well as duplexes, and triplexes. It is a smart way to add a stream of income through the short-term rental of your subtenants. This allows you to pay your own rent and earn more. 

        While Airbnb occupancy rates in Australia vary per city, it’s important to know that rental arbitrage in this country is certainly recovering from the global pandemic’s effects. For instance, the highest occupancy rate and monthly revenue in Darwin can assure an average host to earn AUD $4,520 for a 1 bed/1 bath apartment condo.

        Assuming you are renting a duplex in Sydney for AUD $1,800/month. You are living by yourself on either side and you decide to sublease the other on Airbnb. 

        Let’s say you listed it for AUD $100/day and got 80% occupancy. This will bring in approximately AUD $2,600/month in revenue. Not only will it fully cover your rent, but it will give you a profit of AUD $800. This, in a nutshell, is called Rental Arbitrage.

        If you want to learn more, let this Ultimate Guide About Rental Arbitrage answer all your inquiries!

        Is Airbnb rental arbitrage legal in Australia?

        While Airbnb is legal in the land Down Under, the Australian government regulates the short-term rental industry by imposing shared housing rules such as occupancy restrictions, guest record keeping, and minimum stay requirements. Penalties for violating these requirements are either the suspension or cancellation of your registration number. Fines are also unavoidable.

        Each state has its own regulations for home rentals through Airbnb. This means that there’s a different set of laws for different types of rental arbitrage models in Australia

        1. Sub-lease or License?

        In New South Wales, local councils have the legal authority to determine if a person can rent out their home as a holiday rental through websites like Airbnb. If they do, sanctions can be carried out against them under the local council and State laws

        If you are planning on subleasing a property, then you need to get the landlord’s consent. This is usually done through a lease agreement. If you do not have the landlord’s consent, then you should apply for a license.

        2. Tax Implications

        The Australian Tax Office has policies that require Airbnb investors to declare their rental income on their tax returns and pay appropriate taxes.  

        Depending on how much rental payment you receive from your Airbnb, assessable income may consider some of the expenses that were incurred as a landlord. These can include commercial cleaning, repairs, and property maintenance.

        3. Regulatory Issues

        If you are a landlord using Airbnb, it is important to have public liability insurance. This is because the insurance policy does not include everything that you need to cover when renting out your property.

        If your home is rented through Airbnb, you should consider having the appropriate insurance to protect yourself against third-party claims. You may start considering fire or disability access regulations, as well as food, health, and safety concerns. 

        Websites such as Airbnb have provided accommodation options to people who are looking for a place to stay. However, the law is still developing.

        ​​How do I start an Airbnb arbitrage in Australia?

        1. Convince the landlord

        Let’s say you want to get into Rental Arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your Rental Arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

        You need to be prepared and well-researched about the Airbnb demand in your area. Good communication skills will also come in handy here. Another thing to always keep in mind: never sublease without informing the landlord! There will be a huge number of people coming in and out when you’re sub-renting. It will only be a matter of time before the landlord figures out what you’re up to, and you might end up getting in trouble. 

        For convincing the landlord, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

        Points to tell an indecisive landlord.
        • Doing rental arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income.
          They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income until their property is well maintained. This brings us to our next point.
        • You’ll take care of the house better than a normal renter. As you are using the property for Airbnb, you will maintain it very well to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. 
          Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
        • You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of the landlord.

        In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties. You can also use a free rental arbitrage email template and propose your ideas to landlords!

        2. Ensure the Property and Gain the landlord’s trust

        Being on the safe side is always a good idea. Use the right tools to ensure the property is safe, and the neighbors can go on with their lives happily while you do rental arbitrage. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints, and it’s a legitimate concern. To help you with all these problems, here are some suggestions that you can implement: 

        • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
        • Auto host – Automatically screens problematic tenants.
        • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
        • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
        • Airbnb Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

        Pros and Cons

        Be prepared for what you can expect from Rental Arbitrage in Australia:

        • Pros
          • No purchase of property required
          • Low upfront costs
          • Opportunity to repeat and scale easily
          • Generate profit for other investments or business
        • Cons
          • Invest money and time in furnishing the property

        AIRBNB OCCUPANCY RATES IN AUSTRALIAN CITIES?

        We conducted in-depth research to feature the best cities to host Airbnb in Australia!

        What is the initial cost of starting a rental arbitrage in Australia?

        You can expect to spend anywhere between AUD $3,000 to AUD $5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

        But doesn’t this contradict the low upfront cost of rental arbitrage? Well, these estimates vary from city to city. There is a possibility to do rental arbitrage for even less than this depending upon your situation and the type of property you lease.

        Still, the amount is much less than investing in a new property and getting a mortgage of thousands of dollars. Plus you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

        But this doesn’t mean rental arbitrage can be done with zero or on a very tight budget. There will be some upfront costs that you will have to prepare for by having some extra cash on hand. It will help pay off the lease during the off-season.

        Expense 1: Rental Deposits

        A rental deposit is going to be your first major expense. You will need money to be able to sign a long-term lease with the landlord. For that, you will need a security deposit for your first and previous month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

        Expense 2: Furnishing

        Ideally, you should aim to lease a place that is semi-furnished. Furnishing a place from scratch can add anywhere from AUD $3,000 to AUD $5,000 to your initial capital. Not choosing the right property can make rental arbitrage not so low cost, so choose wisely.

        If the place is semi-furnished, then your best bet is to shop cheap for the rest of the stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

        Expense 3: Photography

        It’s highly recommended to try DIY photography as a start to save money. You can even learn how to take the best Airbnb photos to highlight your listing! But if you have the budget, hiring a professional photographer is also an excellent option. 

        Expense 4: Cleaning Services

        This is not a starting cost, but you will end up spending on cleaning eventually. The best way to save money is to do it yourself initially if you have the skills and experience.

        If you have no experience or you don’t want to invest time in cleaning a place, then your best bet will be to hire a professional cleaner. This can cost you anywhere from AUD $50 to AUD $250 depending upon the size and location.

        Expense 5: Legal Consultation

        Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

        They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

        Best areas for Rental Arbitrage in Australia

        Some obvious places like Brisbane and Melbourne come to mind when thinking of Australia. You can consider these areas when buying investment properties to enter the Australian real estate market.

        Australia’s population and workforce are accompanied by elastic economic growth, which boosts the Australian real estate market. Given the positive financial metrics of Australia’s short-term rentals, investing in Airbnb rental properties in Australia is recommended for any real estate investors

        1. BRISBANE
        Rental Arbitrage Australia

        According to our Airbtics Dashboard, Brisbane is the top market to start your Rental Arbitrage business. Currently, there are overall more than 372 Airbnb listings with an average occupancy rate of 96% and annual revenue of A$68,768. Airbnb businesses are allowed in Brisbane as long as hosts have a short-term rental permit from the city council.

        2. MELBOURNE
        Rental Arbitrage Australia

        According to our Airbtics Dashboard, Melbourne is also one of the top areas to start your Rental Arbitrage business. There are overall more than 8,315 Airbnb property listings with an average occupancy rate of 80%, a daily rate of A$167, and annual revenue of A$50,491. Airbnb is legal in Melbourne even without a planning permit.

        Conclusion

        In summary, rental arbitrage in Australia can be a very profitable side income. Since it does not require you to purchase a property, it’s also practical for beginners trying to be real estate players without spending millions.

        Leverage your rental arbitrage opportunities by using a free Airbnb estimator and determine the best areas that will bring long-term profitability!

        Categories
        Airbnb Rental Arbitrage All About Airbnb

        Rental Arbitrage South Africa

        rental arbitrage south africa


        Table of Contents
          Add a header to begin generating the table of contents

          What is Rental Arbitrage?

          Rental Arbitrage is a profitable method of doing Airbnb in a rented property. This method is similar to house hacking, however, the only difference is that you don’t own the house. Instead, you convince a landlord to lease you a property that will be furnished and subleased on Airbnb and VRBO.

          Rental Arbitrage is a smart technique to earn money in any type of property including multifamily houses, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If you own a duplex or triplex then it is pretty straightforward and easy. You can live in one section and rent out the other – which is also known as house hacking. People use this after taking a loan on a property and use the rent to pay off the mortgage. The short-term rental income helps you pay for the long-term lease that you have on the house. This helps you keep the difference at the month-end after paying for the long-term lease.

          To be specific, Cape Town is considered one of the digital nomad cities with high occupancy rates for Airbnb. According to Airbtics, an average host in Cape Town can earn up to $17,832 annually, especially during the peak seasons from November to January.

          Assume you are renting a duplex in South Africa for $1,800/month. You are living by yourself on one of the sides and you decide to sublease the other on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will bring in approx $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

          Check out this ultimate guide for corporate leasing & learn more about the business!

          What are the things I need to do before getting started?

          How to convince the landlord?

          Let’s say you want to get into rental arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb data analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your rental arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

          You need to be prepared and well researched, good communication skills come in handy here. Also, one thing to always keep in mind: never sublease without informing the landlord, there will be a huge number of people coming in and going out when you’re sub renting, and it will not be hard for the landlord to figure out that you are subletting and you might end up getting in trouble.

          To convince the landlord, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

          • Points to tell an indecisive landlord:

          1. Doing Rental Arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income. They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income till their property is well maintained. This brings us to our next point.

          2. You are more likely to take care of the house than a normal renter. As you are using the property to do business you will take good care of it to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
          3. You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of a landlord.

          In conclusion, you need to take care of the property like your own and make sure to timely pay the monthly lease on time and keep the situation beneficial for both parties.

          Ensure the Property and Gain the landlord’s trust

          Being on the safe side is always a good idea. From troubling guests to bothering landlords. You need to make sure you are using the right tools to ensure the property is safe and neighbors are happy. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints. It is a legitimate concern. To help you with all these problems, here are some suggestions that you can implement and have peace of mind.

          • SimpliSafe– These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
          • Auto host– Automatically screens problematic tenants.
          • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
          • InsuraGuest– This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
          • Airbnb Profit Calculator– Give your landlord ease of mind by providing income estimates backed by Airbnb data.

          You can integrate the majority of these tools with a PMS of your choice.

          Pros and Cons

          rental arbitrage pros and cons

          What is the initial cost of starting a rental arbitrage in South Africa?

          You can expect to spend anywhere between $3,000 to $5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

          But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do Rental Arbitrage for even less than this depending upon your situation and the type of property you lease.

          Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

          But this doesn’t mean Rental Arbitrage can be done with zero or a very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during the off-season in case bookings don’t happen right away.

          Expense 1: Rental Deposits

          A rental deposit is going to be one of the first major expenses. You would need money to be able to sign a long-term lease with the landlord. Therefore, you will need a security deposit, along with your payment for the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

          Expense 2: Furnishing

          Most of the time you should always aim to lease a place that is semi-furnished. As someone with a fully furnished home might be doing short-term rentals themselves. Also furnishing a place from scratch can add anywhere from $3,000 to $5,000 to your initial capital.

          If the place is semi-furnished, then your best bet is to shop for cheap stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

          Expense 3: Photography

          Do it yourself! iPhones have good cameras. DIY photography will save you some money.

          Expense 4: Cleaning Services

          This is included in the starting costs, but you will eventually end up spending on cleaning services. The best way to save money is to do it yourself initially if you have the skills and experience.

          If you have no experience or don’t want to invest time in cleaning a place. Then your best bet will be to hire a professional cleaner. This can cost you anywhere from $50 to $250 depending upon the size and location.

          Expense 5: Legal Consultation

          Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

          They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

          how much can you make on airbnb

          Legality and Regulations in South Africa

          With Airbnb accounting for over 93 percent of all accessible short-term rentals in Cape Town, it’s no surprise that the phrase “Airbnb” is on nearly every community scheme’s radar. There are presently 20,300 postings available in Cape Town, with more than 5,000 items available in Johannesburg.

          While many people have hailed Airbnb for revolutionizing the renting sector in many places across the world, it has also been a significant target for governments, local governments, neighborhood councils, and, predictably, community groups.

          The major reason for this objection is namely the belief that short-term rentals cause trouble to both homeowners and neighbors. Neighbors’ jealousy for not having the same business attitude to join the short-term rental revolution may get to this “annoyance.“

          The second, less visible reason is that it has had a detrimental impact on the availability of homes for residents to utilize for regular long-term rentals.

          However, no law in South Africa prohibits short-term rentals in general. To address the issue of short-term rentals, each city can create and enforce ordinances and zoning rules. Airbnb rules in Cape Town have no regulations expressly addressing these concerns.

          If a city does not expressly ban short-term rentals, the next step is to review the laws and constitution of the Body Corporate or Homeowners Association, as applicable. The majority of these organizations will have leasing policies in place. If the regulations aren’t in favor, homeowners must talk to management agents about their potential Airbnb listing.

          Reference | Property Law | Property24.com

          Best areas for Rental Arbitrage South Africa

          According to our Airbtics Dashboard, De Waterkant is one of the top markets to start your rental arbitrage business. There are more than 273 Airbnb listings with 14 private rooms properties and 155 one-bedroom properties. The monthly revenue for most properties is more than $2,117 per month with occupancy being more than 76%.

          Camps Bay

          According to our Airbtics Dashboard, Camps Bay is the second-best market to start your Rental Arbitrage business in Africa. There are more than 293 Airbnb listings with 47 private rooms properties and 68 one-bedroom properties. The monthly revenue for most properties is more than $2,704/month with occupancy being more than 63%.

          To see full data of South Africa – Click Here

          Read More – Rental Arbitrage London

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          Categories
          Airbnb Rental Arbitrage All About Airbnb

          Rental Arbitrage Arizona

          Rental Arbitrage Arizona
          Table of Contents
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            Introduction

            It’s an ultimate dream to own and purchase a property whether it’s for Airbnb or personal reasons. But the truth is, not everyone can afford to do so. The good news is that there is a viable and more affordable option called rental arbitrage! 

            If you’re wondering about Arizona’s Airbnb rules, process, and profitability – then this article is for you. In this guide, we’ll explain rental arbitrage in layman’s terms and provide some expert tips. We also included the best areas to do rental arbitrage in Arizona to help you make the best investment decisions. Stoked to learn more? Continue reading!

            What is Rental Arbitrage?

            Rental Arbitrage is an expert technique where you sublease a property for the sole purpose of Airbnb. This is initially allowed with the property owner’s or landlord’s approval.  Rental arbitrage is somehow similar to house hacking, except that you don’t own the property. Instead, you convince a landlord to lease you a property that you can then furnish and sublease on Airbnb and VRBO.

            Rental Arbitrage is an efficient method for multifamily houses, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If done right, this can be a full-fledged business!

            If you own a duplex or triplex property, then it is pretty straightforward. You can live in one part of the house and rent out the other. This process is known as house hacking. Property investors try this method after taking a loan on a property and use the rent to pay off the mortgage. The short-term rent will help you pay for your property’s long-term lease. This helps you keep the difference at the month-end after paying for the long-term lease. 

            Here’s a perfect example to understand how rental arbitrage works. Assume that you are renting a duplex in Arizona for $1,800/month. You are living by yourself in the property and you decide to sublease an extra room on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will generate approx $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

            Is rental arbitrage allowed in Arizona? 

            Yes, Airbnb rental arbitrage is certainly legal in the state of Arizona. The Arizona government provides detailed information about their shared housing rules, including occupancy restrictions, guest record keeping, and minimum stay requirements. Violating these requirements may result in penalties and suspension or cancellation of your registration number. 

            This list is not exhaustive, but it should be a good start in understanding local laws. If you have any questions, it’s recommended to contact the Ministry of Planning and Development or consult a local tax attorney. Here are some of the Airbnb rules in Arizona that you should take note of:

            • Arizona’s Short-Term Leasing Regulations

            The Arizona Council approved the “Short-Term Vacation Leasing Regulations” in January 2020. This requires vacation or short-term rental owners to register with the city government and provide emergency and complaint contact information. 

            The decree also outlines the prohibited uses of vacation rentals and imposes penalties for violations ($500 for the first violation, $1,000 for the second violation within 12 months, and $ 3,500 for the third violation within 12 months). Check Arizona city’s website for more information on short-term rental rules.

            • Arizona’s Rental Registration

            All residential rental units, including vacation and short-term rentals, must be registered in Maricopa County under ARS 331902. You can register your rental through this link. 

            • Hotel and Rental tax

            Arizona requires owners and operators of hotels and certain rental properties to apply for permits. You should refer to Chapter 14 of the City Code to determine whether these rules apply to your list.

            • Taxes

            Arizona assesses sales tax on real estate leases and additional tax on temporary housing. Guests who qualify as “permanent residents” or those who stay for 30 days or more are exempted from temporary accommodation tax. 

            Arizona also imposes a temporary lodging tax on guests staying less than 30 days.

            • Housing and Construction Standards

            Phoenix has established rules and regulations for the construction, design, and maintenance of buildings. This includes regulations on habitability, health, and safety. Certain regulations that apply to residential and non-residential uses may be relevant to your listing. 

            It is also important to understand and comply with the rules indicated in each contract. This includes but is not limited to leases, apartment or cooperative committee rules, HOA rules, or rules established by tenant organizations. Read your lease, and if applicable, consult with your landlord to avoid breaching contracts

            How to start rental arbitrage in Arizona?

            1. Convince the landlord

            Let’s say you want to get into rental arbitrage. You may be wondering, how do I find rental arbitrage properties and how should I convince the landlord? Later in the blog, we’ll be explaining how to find a good property by doing proper research using short-term rental analytics. In this section, we will be focusing more on how to convince a landlord to do rental arbitrage. As you’ll begin your rental arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

            You need to be prepared and well-researched about the popularity of Airbnb in your area. Having good communication skills will also come in handy! Here’s one thing that you should always keep in mind: never sublease without informing the landlord. There will be a huge number of people coming in and out when you’re sub-renting, so the landlord will most likely figure out that you are subletting and you might end up getting in trouble.

            When convincing the landlord, rule number one is to always talk about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So in return, they lease the property to you instead of renting it by themselves.

            Points To Tell An Indecisive Landlord:
            • Doing rental arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income.
              They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income until their property is well maintained. This brings us to our next point.
            • You’ll take care of the house better than a normal renter. As you are using the property for Airbnb, you will maintain it very well to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. 
              Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
            • You can ensure timely monthly rent. You can tell the landlord that doing rental arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of the landlord.

            In conclusion, you need to take care of the property and treat it like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties. You can also use a free rental arbitrage email template and propose your ideas to landlords!

            2. Ensure the property and gain the landlords’ trust

            Being on the safe side is always a good idea. You need to make sure you are using the right tools to ensure that the property is safe and neighbors aren’t bothered by guests. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints and it’s a legitimate concern. To help you with all these problems, here are some suggestions that you can implement: 

            • SimpliSafe– These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
            • Auto host– Automatically screens problematic tenants.
            • InsuraGuest– This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
            • Airbnb Profit Calculator– Give your landlord ease of mind by providing income estimates backed by Airbnb data.

            On a side note, you can also integrate the majority of these tools with short-term rental management software such as Hostaway or Guesty.

            Pros and Cons

            What are the pros and cons of doing rental arbitrage in Arizona? Here’s the part where you can set your expectations:

            • Pros
              • No need to own, invest, or purchase a property 
              • Low upfront costs
              • Higher chances to repeat and scale easily
              • Generated profit can be used for other investments or businesses
            • Cons

              • Invest money and time in furnishing the property

            how much can you make on airbnb
            Check Short Term Rental Data for Your City

            How much do Airbnb hosts make in Arizona?

            Airbtics’ data confirm that an Airbnb host in Arizona, particularly in Scottsdale, can earn an average daily rate of $224. This is by operating a 2-bedroom apartment/flat alone! Airbnb hosts are expected to generate an annual revenue of $60,234 with a steady occupancy rate of 60%.

            What are the initial costs of starting Rental Arbitrage in Arizona?

            You can expect to spend anywhere between $3,000 to $5,000. This includes deposit, furnishing, amenities, legal paperwork, and LLC Incorporation.

            But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do rental arbitrage for even less than this depending upon your situation and the type of property you lease.

            Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

            But this doesn’t mean that rental arbitrage can be done with zero or a very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during the off-season in case bookings don’t happen right away. Check out some of the expenses that you have to prepare for:

            Expense 1: Rental Deposits

            A rental deposit is going to be one of the first major expenses. You will need money to be able to sign a long-term lease with the landlord. For that, you will need a security deposit and the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

            Expense 2: Furnishing

            Most of the time, you should always aim to lease a place that is semi-furnished. Furnishing a place from scratch can add anywhere from $3,000 to $5,000 to your initial capital. Not choosing the right property can make rental arbitrage not so low cost, so choose wisely.

            If the place is semi-furnished, then your best bet is to shop for cheap and affordable amenities. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart offers hidden gems if you look closely.

            Expense 3: Photography

            It’s highly recommended to try DIY photography as a start to save money. You can even learn how to take the best Airbnb photos to highlight your listing! But if you have the budget, hiring a professional photographer is also an excellent option. 

            Expense 4: Cleaning Services

            This is not a starting cost, but you will eventually end up spending on cleaning services. The best way to save money is to do the cleaning by yourself if you have the time, skills, and experience.

            If you have no experience or don’t want to invest time in cleaning a place, then your best bet will be to hire a professional cleaner. This can cost you anywhere from $50 – $250 depending upon the size and location.

            Expense 5: Legal Consultation

            Maintaining a professional relationship with a real estate lawyer can be very helpful in the Airbnb business. Airbnb regulations are constantly changing and you will need some legal guidance to adjust your business accordingly.

            Legal guidance can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance in case of any mishappening.

            Best Areas for Rental Arbitrage Arizona

            Some of the obvious places that you can think of in Arizona are Phoenix and Tucson. In general, Arizona’s population and employment growth are accompanied by economic growth elastic. This promotes the growth of Arizona’s real estate market. 

            Phoenix also encourages the city’s Airbnb business. As a real estate investor, given the positive financial metrics of Arizona short-term rentals, investing in Airbnb rental properties is recommended because of its positive financial metrics.

            1. Phoenix
            Rental Arbitrage Arizona

            According to Airbtics Dashboard, Phoenix is the top market to start your rental arbitrage business. There are more than 3,107 Airbnb listings with 525 private rooms properties and 755 one-bedroom properties. The monthly revenue for most properties is more than $3,104.

            2. Tucson
            Rental Arbitrage Arizona

            Airbtics confirms that Tucson is the second-best market to start your Rental Arbitrage business. There are more than 1,536 Airbnb listings with 210 private room properties and 434 one-bedroom properties. The monthly revenue for most properties is more than $2,525.

            Conclusion

            To sum it up, Airbnb rental arbitrage in Arizona provides exciting opportunities and promising income. Since it does not require you to purchase a property, it’s also practical for beginners! The big question is where are the best areas to do rental arbitrage in Arizona?

            With the help of an STR analytics tool like Airbtics, you can easily discover the best areas to do rental arbitrage anywhere in the world. Leverage your opportunities in rental arbitrage by using an Airbnb income calculator and determine the best areas that will bring long-term profitability!

            Categories
            Airbnb Rental Arbitrage All About Airbnb

            Rental Arbitrage Los Angeles

            Rental Arbitrage Los Angeles

            Rental Arbitrage Los Angeles is a comprehensive guide to give you an idea about the arbitrage concept and get you started with your journey.

            Home > Resources > Airbnb Rental Arbitrage > 

            Rental Arbitrage Los Angeles

            Rental Arbitrage Los Angeles
            Airbnb Rental Arbitrage

            Rental Arbitrage Los Angeles

            Rental Arbitrage Los Angeles is a comprehensive guide to give you an idea about the arbitrage concept and get you started with your journey.

            • Last updated on
            • August 16, 2023

            What is Rental Arbitrage?

            Rental Arbitrage is a method similar to house hacking, however, the only difference is that you don’t own the house. Instead, you convince a landlord to lease you a property that will be furnished and subleased on Airbnb and VRBO.

            Rental Arbitrage is a smart technique to earn money in any type of property including a multifamily house, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If you own a duplex or triplex then it is pretty straightforward and easy. You can live in one section and rent out the other – which is also known as house hacking. People use this after taking a loan on a property and use the rent to pay off the mortgage. The short-term rental income helps you pay for the long-term lease that you have on the house. This helps you keep the difference at the month-end after paying for the long-term lease.

            Assume you are renting a duplex in Los Angeles for $1,800/month. You are living by yourself on one of the sides and you decide to sublease the other on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will bring in approximately $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

            Find out more about Rental Arbitrage Business and stand out like a pro!

            What are the things I need to do before getting started?

            How to convince the landlord

            Let’s say you want to get into Rental Arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using Vacation rental analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your Rental Arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

            You need to be prepared and well researched, good communication skills come in handy here. Also, one thing to always keep in mind: never sublease without informing the landlord, there will be a huge number of people coming in and going out when you’re sub renting, it will not be hard for the landlord to figure out that you are subletting and you might end up getting in trouble.

            For convincing, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

            Points to tell an indecisive landlord
            • Doing Rental Arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income. They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income till their property is well maintained. This brings us to our next point.
            • You are more likely to take care of the house than a normal renter. As you are using the property to do business you will take good care of it to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
            • You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of a landlord.

            In conclusion, you need to take care of the property like your own. Make sure to timely pay monthly leases and keep the situation beneficial for both parties.

            Ensure the Property and Gain the landlord’s trust

            Being on the safe side is always a good idea. From troubling guests to bothering landlords. You need to make sure you are using the right tools to ensure the property is safe and neighbors are happy. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints. It is a legitimate concern. To help you with all these problems, here are some suggestions that you can implement and have peace of mind.

            • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
            • Auto host – Automatically screens problematic tenants.
            • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
            • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
            • Vacation Rental Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

            You can integrate the majority of these tools with a PMS of your choice.

            Pro’s and Con’srental arbitrage pros and cons

            WANT TO SEE  THE AIRBNB OCCUPANCY RATES IN LA?

            View the free Airbnb occupancy rates data in all the cities of the world!

            What is the initial cost of starting a rental arbitrage in Los Angeles?

            You can expect to spend anywhere between $3,000 to $5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

            But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do Rental Arbitrage for even less than this depending upon your situation and the type of property you lease.

            Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

            But this doesn’t mean Rental Arbitrage can be done with zero or very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during off-season in case bookings don’t happen right away.

            Expense 1: Rental Deposits

            A rental deposit is going to be one of the first and major expenses. You would need money to be able to sign a long-term lease with the landlord. Therefore, you will need a security deposit, along with your payment for the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

            Expense 2: Furnishing

            Most of the time you should always aim to lease a place that is semi-furnished. As someone with a fully furnished home might be doing short-term rentals themselves. Also furnishing a place from scratch can add anywhere from $3,000 to $5,000 to your initial capital.

            If the place is semi-furnished, then your best bet is to shop for cheap stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

            Expense 3: Photography

            Do it yourself! iPhones have good cameras. DIY photography will save you some money.

            Expense 4: Cleaning Services

            This is included in the starting costs, but you will eventually end up spending on cleaning services. The best way to save money is to do it yourself initially if you have the skills and experience.

            If you have no experience or you don’t want to invest time in cleaning a place. Then your best bet will be to hire a professional cleaner. This can cost you anywhere from $50 to $250 depending upon the size and location.

            Expense 5: Legal Consultation

            Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

            They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

            Legality and Regulations in Los Angeles

            With over 40,000 Airbnb listings, Los Angeles is one of the largest cities in the United States of America and a popular destination for short-term rentals. In 2018, the city’s house-sharing ordinance was updated, and the new legislation went into force on July 1st, 2019. The following is a thorough city guide to Los Angeles’ home-sharing legislation and short-term rental regulations, so anybody may host correctly.

            Hosts may lease their short-term rental homes for a total of 120 days each year. Operators can, however, request an exception that will allow them to rent out their houses for longer than the 120-day limit.

            In addition, short-term rental hosts must:

            • Enroll with the town and pay the fee
            • View their registered number on ads; and
            • Obtain approval from the city.
            • Check for safety features such as functional smoke detectors, fire extinguishers, and emergency exit information.

            Short-term rental sites like Airbnb, HomeAway, and VRBO are also subject to the new ordinance’s restrictions. They are not permitted to handle bookings for rentals that are not listed with the city or have exceeded the yearly rental limit. Such platforms may have to pay $1,000 daily penalty if the regulations are violated. Platforms must also include information on the city’s hosts.

            Reference | Keycafe Blog | Avalara.com

            Best areas for Rental Arbitrage in Los Angeles

            1. Venice

            rental arbitrage los angeles venice

            According to our Airbtics Dashboard, La Jolla is the top market to start your Rental Arbitrage business. There are more than 1,494 Airbnb listings with 286 private rooms properties and 435 one-bedroom properties. The monthly revenue for most properties is more than $5,597/month with occupancy being more than 64%.

            2. Bel Air

            rental arbitrage los angeles bel air

            According to our Airbtics Dashboard, Bel Air is the second-best market to start your Rental Arbitrage business. There are more than 1,102 Airbnb listings with 255 private rooms properties and 258 one-bedroom properties. The monthly revenue for most properties is more than $5,171/month with occupancy being more than 52%.

            Rental Arbitrage Los Angeles

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            Rental Arbitrage London

            Rental Arbitrage London

            Introduction

            Subletting a property in London is legal as long as a custom agreement is settled with the landlord. This process is also known as rental arbitrage, which is an excellent way to generate passive income. Are you looking for expert ways to do rental arbitrage in London but aren’t sure how? 

            In this guide, we’ll explain rental arbitrage in layman’s terms and provide some expert tips. We also included the best areas to do rental arbitrage in London to help you make the best investment decisions. Stoked to learn more? Continue reading!

            What is Rental Arbitrage?

            Rental Arbitrage is an expert technique where you sublease a property for the sole purpose of Airbnb. This is initially allowed with the property owner’s or landlord’s approval.  Rental arbitrage is somehow similar to house hacking, except that you don’t own the property. Instead, you convince a landlord to lease you a property that you can then furnish and sublease on Airbnb and VRBO.

            Rental Arbitrage is an efficient method for multifamily houses, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If done right, this can be a full-fledged business!

            If you own a duplex or triplex property, then it is pretty straightforward. You can live in one part of the house and rent out the other. This process is known as house hacking. Property investors try this method after taking a loan on a property and use the rent to pay off the mortgage. The short-term rent will help you pay for your property’s long-term lease. This helps you keep the difference at the month-end after paying for the long-term lease. 

            Here’s a perfect example to understand how rental arbitrage works. Assume that you are renting a duplex in Texas for $1,800/month. You are living by yourself in the property and you decide to sublease an extra room on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will generate approx $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

            Is rental arbitrage allowed in London? 

            Rental arbitrage is allowed in the UK, particularly in London. It’s also good to know that a standard rental agreement cannot be used as this process is a breach of contract. For instance, if you have an Assured Shorthold Tenancy Agreement (AST), it cannot be used as a legal basis to do rental arbitrage. A separate contract indicating that the landlord allows you to sublet the property is necessary to avoid legal charges.

            The Government of London provides detailed information about housing rules. This includes occupancy restrictions, guest record keeping, and minimum stay requirements. Violating these requirements may result in penalties and suspension or cancellation of your registration number. Here are some of the Airbnb rules in London that you should take note of:

            1. London’s 90-day annual limit

            The 90-Day Airbnb rule in London states that a property can’t be let out for more than 90 days per year. This rule only applies to entire houses listed in the Greater London area as of 2023. It’s best not to ignore this rule as you can be fined up to £20,000! 

            2. Planning Permit

            If you’re wondering, do you need a permit for Airbnb in London? Here’s the answer! The planning permit issued by London’s City Council also allows you to rent it out throughout the year. This can be obtained if you want to exceed the 90-day limit. UK regulations state that anyone who rents a home for more than 90 days in a calendar year must obtain planning permission. 

            This is called temporary sleeping accommodations. If you plan to rent your accommodation as a short-term rental using a third-party platform such as Airbnb or other sites, you must first apply for a building permit from the city hall.

            3. Municipal Tax

            London’s Deregulation Act also requires all persons responsible for providing short-term rental accommodation to have a legal obligation to pay municipal tax. 

            In any case, you must obtain a gas safety certificate for the property and conduct a fire risk assessment once a year. Your property must also provide smoke detectors and carbon monoxide alarms. 

            4. Confirm with your landlord

            London’s City Council recommends that you confirm with your landlord first before listing your accommodation on booking sites such as Airbnb. This is regardless if you want to apply for planning permission or not. It is also recommended that you confirm any lease, insurance, or mortgage policy that states restrictions on short-term rentals.

            How to start rental arbitrage in London?

            1. Convince the landlord

            Let’s say you want to get into rental arbitrage. You may be wondering, how do I find rental arbitrage properties and how should I convince the landlord? Later in the blog, we’ll be explaining how to find a good property by doing proper research using short-term rental analytics. In this section, we will be focusing more on how to convince a landlord to do rental arbitrage. As you’ll begin your rental arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

            You need to be prepared and well-researched about the popularity of Airbnb in your area. Having good communication skills will also come in handy! Here’s one thing that you should always keep in mind: never sublease without informing the landlord. There will be a huge number of people coming in and out when you’re sub-renting, so the landlord will most likely figure out that you are subletting and you might end up getting in trouble.

            When convincing the landlord, rule number one is to always talk about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So in return, they lease the property to you instead of renting it by themselves.

            Points To Tell An Indecisive Landlord:
            • Doing rental arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income.
              They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income until their property is well maintained. This brings us to our next point.
            • You’ll take care of the house better than a normal renter. As you are using the property for Airbnb, you will maintain it very well to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. 
              Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
            • You can ensure timely monthly rent. You can tell the landlord that doing rental arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of the landlord.

            In conclusion, you need to take care of the property and treat it like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties. You can also use a free rental arbitrage email template and propose your ideas to landlords!

            2. Ensure the property and gain the landlords’ trust

            Being on the safe side is always a good idea. You need to make sure you are using the right tools to ensure that the property is safe and neighbors aren’t bothered by guests. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints and it’s a legitimate concern. To help you with all these problems, here are some suggestions that you can implement: 

            • SimpliSafe– These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
            • Auto host– Automatically screens problematic tenants.
            • InsuraGuest– This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
            • Airbnb Profit Calculator– Give your landlord ease of mind by providing income estimates backed by Airbnb data.

            On a side note, you can also integrate the majority of these tools with short-term rental management software such as Hostaway or Guesty.

            airbtics str

            How much can I make with Rental Arbitrage in London?

            Airbtics’ data confirm that an Airbnb host in London, particularly in the city centre, can earn an average nightly rate of £258. This is by operating a 2-bedroom apartment/flat alone! Airbnb hosts are expected to generate an annual revenue of £66,159 with a steady occupancy rate of 85%.

            What are the initial costs of starting Rental Arbitrage in London?

            You can expect to spend anywhere between £2,500 to £4,000. This includes deposit, furnishing, amenities, legal paperwork, and LLC Incorporation.

            But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do rental arbitrage for even less than this depending upon your situation and the type of property you lease.

            Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

            But this doesn’t mean that rental arbitrage can be done with zero or a very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during the off-season in case bookings don’t happen right away. Check out some of the expenses that you have to prepare for:

            Expense 1: Rental Deposits

            A rental deposit is going to be one of the first major expenses. You will need money to be able to sign a long-term lease with the landlord. For that, you will need a security deposit and the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

            Expense 2: Furnishing

            Most of the time, you should always aim to lease a place that is semi-furnished. Furnishing a place from scratch can add anywhere from £2,500 to £4,000 to your initial capital. Not choosing the right property can make rental arbitrage not so low cost, so choose wisely.

            If the place is semi-furnished, then your best bet is to shop for cheap and affordable amenities. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart offers hidden gems if you look closely.

            Expense 3: Photography

            It’s highly recommended to try DIY photography as a start to save money. You can even learn how to take the best Airbnb photos to highlight your listing! But if you have the budget, hiring a professional photographer is also an excellent option. 

            Expense 4: Cleaning Services

            This is not a starting cost, but you will eventually end up spending on cleaning services. The best way to save money is to do the cleaning by yourself if you have the time, skills, and experience.

            If you have no experience or don’t want to invest time in cleaning a place, then your best bet will be to hire a professional cleaner. This can cost you anywhere from £40 to £2,500 depending upon the size and location.

            Expense 5: Legal Consultation

            Maintaining a professional relationship with a real estate lawyer can be very helpful in the Airbnb business. Airbnb regulations are constantly changing and you will need some legal guidance to adjust your business accordingly.

            Legal guidance can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance in case of any mishappening.

            LOOKING FOR PROFITABLE LOCATIONS IN LONDON?

            Check out the best up and coming places to buy in London!

            Best Areas for Rental Arbitrage in London

            Some of the obvious places that you can think of in London are Lambeth and Southwark. You can consider these areas when buying investment properties in London. 

            London’s population and employment growth are accompanied by economic growth elastic. This promotes the growth of London’s real estate market. Lambeth also encourages the city’s Airbnb business. As a real estate investor, given the positive financial metrics of London short-term rentals, investing in Airbnb rental properties is recommended because of London’s positive financial metrics. 

            1. Lambeth 

            According to Airbtics Dashboard, Lambeth is the top market to start your rental arbitrage business. There are overall more than 1,099 Airbnb listings and a host can expect to earn a daily rate of £101. $143. The annual monthly revenue for most properties in Lambeth is £29,095 with an occupancy rate of 93%.

            Rental Arbitrage London
            2. Southwark

            Airbtics’ data confirm that Dashboard, Southwark is the next best area to start your rental arbitrage business. There are more than 1,270 Airbnb listings and a host can expect to earn a daily rate of £119. The annual revenue for most properties in Southwark is £34,653 with an occupancy rate of more than 92%.

            Rental Arbitrage London

            Conclusion

            In summary, rental arbitrage in London can be a very profitable side income. Since it does not require you to purchase a property, it’s also practical for beginners! The big question is where is the best area to do rental arbitrage in London?

            Starting an Airbnb business in the UK can certainly be profitable as long as you find the best areas to begin with. While there are several properties for sale, not all of them will provide excellent returns. This is where accurate data and research can back you up to make the best investment decisions.

            Comparing occupancy rates in London has never been easier to do manually. But with the help of an STR analytics tool like Airbtics, it was discovered that the Islington borough has the highest Airbnb occupancy rate of 71%. Leverage your opportunities in rental arbitrage by using a free Airbnb calculator and determine the best areas that will bring long-term profitability!

            Categories
            Airbnb Rental Arbitrage All About Airbnb

            Rental Arbitrage Canada

            Rental Arbitrage Canada
            Table of Contents
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              Introduction

              The great white north offers a wide range of opportunities for financial freedom. In fact, you can earn easy money by renting out a property without actually owning it. Rental Arbitrage enables this setup. It is a smart way to earn passive income with only minimal investment!

              In this guide, we’ll explain rental arbitrage in layman’s terms and provide some expert tips. We also included the best areas to do rental arbitrage in Canada to help you make the best investment decisions. Stoked to learn more? Continue reading!

              What is Rental Arbitrage?

              Rental Arbitrage is a method similar to house hacking, where you rent out a spare room in your property. The difference between these two is you don’t need to own the house in rental arbitrage. Instead, you convince the property owner to allow you to sublease the house on Airbnb and VRBO.

              Airbnb rental arbitrage in Canada is applicable to multi-room apartments, houses, condo units, duplexes, and triplexes. It is a smart way to add a stream of income through the short-term rental of your subtenants. This allows you to pay your own rent and earn more. Here’s an example to help you understand rental arbitrage better.

              Assume you are renting a duplex in Calgary for  C$1,800/month. You are living by yourself on either side and you decide to sublease the other on Airbnb. Let’s say you listed it for C$100 per day and got 80% occupancy. This will bring in approx C$2,600/month in revenue. Not only will it help you pay off your complete rent, but it will also give you a profit of C$800. This, in a nutshell, is called rental arbitrage.

              Is rental arbitrage legal?

              Yes, but rules vary per city in Canada. Quebec requires registration of short-term rentals of fewer than 31 days to get a license. Quebec was also the first Canadian province to regulate short-term rentals. 

              Registration of all short-term rental properties is also a must in Toronto. Airbnb operators are also required to pay a 4% Municipal Accommodation Tax. 

              On the other hand, the City of Vancouver only issues short-term rental licenses for main residences. This requires hosts to live on the property while operating their Airbnb.

              Hosts in the City of Edmonton must have a business license for their short-term rentals. The same also applies in the City of Calgary. 

              How do I get into rental arbitrage?

              1. Convince the landlord

              Let’s say you want to get into rental arbitrage. Now comes the big question, how do find a good property and how to convince the landlord? Later in the blog, we’ll be explaining how to find a good property by doing proper research using Airbnb analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your rental arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

              You need to be prepared and well-researched about the Airbnb demand in your area. Good communication skills will also come in handy here. Another thing to always keep in mind: never sublease without informing the landlord! There will be a huge number of people coming in and out when you’re sub-renting. It will only be a matter of time before the landlord figures out what you’re up to, and you might end up getting in trouble. 

              For convincing the landlord, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

              Points to tell an indecisive landlord.
              • Doing rental arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income.
                They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income until their property is well maintained. This brings us to our next point.
              • You’ll take care of the house better than a normal renter. As you are using the property for Airbnb, you will maintain it very well to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. 
                Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
              • You can ensure timely monthly rent. You can tell the landlord that doing rental arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain the trust of the landlord.

              In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties. You can also use a free rental arbitrage email template and propose your ideas to landlords!

              2. Ensure the Property and Gain the landlord’s trust

              Being on the safe side is always a good idea. Use the right tools to ensure the property is safe, and the neighbors can go on with their lives happily while you do rental arbitrage. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints, and it’s a legitimate concern. To help you with all these problems, here are some suggestions that you can implement: 

              • SimpliSafe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
              • Auto host – Automatically screens problematic tenants.
              • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
              • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies.
              • Airbnb Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

              Pros and Cons

              Be prepared for what you can expect from rental arbitrage in Canada:

              • Pros
                • No purchase of property required
                • Low upfront costs
                • Opportunity to repeat and scale easily
                • Generate profit for other investments or business
              • Cons
                • Invest money and time in furnishing the property

              AIRBNB OCCUPANCY RATES IN CANADIAN CITIES?

              We conducted in-depth research & utilized our Airbnb occupancy rate calculator to feature the occupancy rates of major cities!

              Airbnb data

              How much does it cost to start an Airbnb arbitrage?

              You can expect to spend anywhere between C$3,000 to C$5,000. This cost includes deposit, furnishing, amenities, legal paperwork, and LLC Incorporation.

              But doesn’t this contradict the low upfront cost of rental arbitrage? Well, these estimates vary from city to city. There is a possibility to do rental arbitrage for even less than this depending upon your situation and the type of property you lease.

              Still, the amount is much less than investing in a new property and getting a mortgage of thousands of dollars. Plus you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

              But this doesn’t mean that rental arbitrage can be done with zero or on a very tight budget. There will be some upfront costs that you will have to prepare for by having some extra cash on hand. It will help pay off the lease during the off-season.

              Expense 1: Rental Deposits

              A rental deposit is going to be your first major expense. You will need money to be able to sign a long-term lease with the landlord. For that, you will need a security deposit for your first and previous month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

              Expense 2: Furnishing

              Ideally, you should aim to lease a place that is semi-furnished. Furnishing a place from scratch can add anywhere from C$3,000 to C$5,000 to your initial capital. Not choosing the right property can make rental arbitrage not so low cost, so choose wisely.

              If the place is semi-furnished, then your best bet is to shop cheap for the rest of the stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

              Expense 3: Photography

              It’s highly recommended to try DIY photography as a start to save money. You can even learn how to take the best Airbnb photos to highlight your listing! But if you have the budget, hiring a professional photographer is also an excellent option. 

              Expense 4: Cleaning Services

              This is not a starting cost, but you will end up spending on cleaning eventually. The best way to save money is to do it yourself initially if you have the skills and experience.

              If you have no experience or you don’t want to invest time in cleaning a place, then your best bet will be to hire a professional cleaner. This can cost you anywhere from C$50 to C$250 depending upon the size and location.

              Expense 5: Legal Consultation

              Maintaining a professional relationship with a real estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

              They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

              Best areas for rental arbitrage Canada

              Some of the most popular places in  Canada are  Port Credit and Old Quebec. Here are the  top  two choices for rental arbitrage top our list:

              1. Downtown Victoria
              Rental Arbitrage Canada

              Airbtics Dashboard confirms Downtown Victoria as the top market to start your Rental Arbitrage business. There are more than 569 Airbnb listings with average annual revenue of more than C$61,016 and an occupancy rate of 88%

              2. Downtown Vancouver
              Rental Arbitrage Canada

              Airbtics Dashboard shows Downtown Vancouver as the second-best market to start your Rental Arbitrage business. There are more than 326 Airbnb with annual revenue of C$75,508 and an 88% occupancy rate.

              Looking for the Best Canadian Cities for Airbnb Investments?

              If you are looking for a profitable Canadian rental market, make sure to check out more Airbnb statistics in Canada!

              Conclusion

              In summary, rental arbitrage in Canada can be a very profitable side income. Since it does not require you to purchase a property, it’s also practical for beginners trying to be real estate players without spending millions.

              Leverage your rental arbitrage opportunities by using a free Airbnb estimator and determine the best areas that will bring long-term profitability!

              Categories
              Airbnb Rental Arbitrage All About Airbnb

              Rental Arbitrage Chicago


              Table of Contents
                Add a header to begin generating the table of contents

                What is Rental Arbitrage?

                Rental Arbitrage is a method similar to house hacking, however, the only difference is that you don’t own the house. Instead, you convince a landlord to lease you a property which will be furnished and subleased on Airbnb and VRBO.

                Rental Arbitrage is a smart technique to earn money in any type of property including a multifamily house, duplexes, or triplexes. You can easily use the money from your short-term rental to pay off your lease and profit some more. If you own a duplex or triplex then it is pretty straightforward and easy. You can live in one section and rent out the other – which is also known as house hacking. People use this after taking a loan on a property and use the rent to pay off the mortgage. The short-term rental income helps you pay for the long-term lease that you have on the house. This helps you keep the difference at the month-end after paying for the long-term lease.

                Assume you are renting a duplex in Chicago for $1,800/month. You are living by yourself on one of the sides and you decide to sublease the other on Airbnb. Let’s say you listed it for $100/day and got 80% occupancy. This will bring in approximately $2,600/month in revenue. Not only will it help you pay off your complete rent, but give you a profit of $800. This, in a nutshell, is called Rental Arbitrage.

                Read more about Short-term Rental Arbitrage and be guided accordingly!

                What are the things I need to do before getting started?

                How to convince the landlord

                Let’s say you want to get into Rental Arbitrage. Now comes the big question, how to find a good property and how to convince the landlord. Later in the blog, we’ll be explaining how to find a good property by doing proper research using short-term rental analytics. In this section, we will be focusing more on how to convince landlords. As you’ll begin your Rental Arbitrage journey, you’ll come to know that this is the hardest part of the whole process.

                You need to be prepared and well researched, good communication skills come in handy here. Also, one thing to always keep in mind: never sublease without informing the landlord, there will be a huge number of people coming in and going out when you’re sub renting, it will not be hard for the landlord to figure out that you are subletting and you might end up getting in trouble.

                For the convincing, rule number one is always talking about the upsides. If you can rent the property on Airbnb, so can the landlord himself. You need to make a deal with the landlord that is beneficial to them. So they lease the property to you instead of renting it by themselves.

                Points to tell an indecisive landlord
                • Doing Rental Arbitrage is a full-time business. It doesn’t generate passive income like long-term leasing. You should try approaching older people who are looking for some sort of passive income. They are more likely to agree to a fixed long-term lease. You can also reach out to full-time working professionals or business owners. They will also be happy with a source of passive income till their property is well maintained. This brings us to our next point.
                • You are more likely to take care of the house than a normal renter. As you are using the property to do business you will take good care of it to make sure you get better reviews. Having a beat-up property isn’t good for business and you are more likely to monitor it often. Not monitoring it will affect your revenue a lot. You may end up paying a huge sum of money for damages done by someone else. So telling this to the landlord might instill some confidence in them.
                • You can ensure timely monthly rent. You can tell the landlord that doing Rental Arbitrage is a full-time business with ups and downs. It doesn’t guarantee fixed income at all like long-term leasing. But if they lease it to you, you’ll make sure to pay the lease no matter what. Either from the money made after rental arbitrage or from your savings. You need to ensure timely monthly lease payments to gain a landlord’s trust. 

                In conclusion, you need to take care of the property like your own. Make sure to timely pay the monthly lease and keep the situation beneficial for both parties.

                how much can you make on airbnb
                Click Here to See Short Term Rental Data for your City
                Ensure the Property and Gain landlord’s trust

                Being on the safe side is always a good idea. From trouble guests to bothering landlords. You need to make sure you are using the right tools to ensure the property is safe and neighbors are happy. Many landlords will have this concern when renting out their property to you. They will be worried about neighbors raising noise complaints. It is a legitimate concern. To help you with all these problems here are some suggestions that you can implement and have peace of mind.

                • Simply Safe – These are home monitoring tools that you can install in the house to make sure no suspicious activity is happening there. Make sure to let the guests know about them and have their consent.
                • Auto host – Automatically screens problematic tenants.
                • Alexa Guard: If you already own an Alexa, you can use its Alexa guard feature to detect parties. It is an inbuilt feature that monitors changes in sound and sends you an alert in case the guests are having a party and making too much noise.
                • InsuraGuest – This insurance and tech company helps you with risk analysis and gives protection beyond Airbnb and VRBO policies. 
                • Airbnb ROI Calculator – Give your landlord ease of mind by providing income estimates backed by Airbnb data.

                You can integrate the majority of these tools with a PMS of your choice.

                rental arbitrage pros and cons

                What is the initial cost of starting a rental arbitrage in Chicago?

                You can expect to spend anywhere between $3,000 to $5,000. This cost includes Deposit, Furnishing, Amenities, Legal Paperwork, and LLC Incorporation.

                But doesn’t this contradict the Low upfront cost of Rental Arbitrage? Well, these estimates vary from city to city. There is a possibility to do Rental Arbitrage for even less than this depending upon your situation and the type of property you lease.

                Still, the amount is lesser than investing in a new property and getting a mortgage of thousands of dollars. In addition to this, you won’t be on the hook for property maintenance expenses and being stuck for years with debt.

                But this doesn’t mean Rental Arbitrage can be done with zero or very tight budget. There will be some upfront costs that you have to expect so it’s ideal to own some extra cash is also a good thing to have. This will help pay off the lease during off-season in case bookings don’t happen right away.

                Expense 1: Rental Deposits

                A rental deposit is going to be one of the first and major expenses. You would need money to be able to sign a long-term lease with the landlord. Therefore, you will need a security deposit, along with your payment for the first and last month’s rent. Sometimes you can negotiate with the landlord and use the first month’s rent as a security deposit.

                Expense 2: Furnishing

                Most of the time you should always aim to lease a place that is semi-furnished. As someone with a fully furnished home might be doing short-term rentals themselves. Also furnishing a place from scratch can add anywhere from $3,000 to $5,000 to your initial capital.

                If the place is semi-furnished, then your best bet is to shop for cheap stuff. You can go and find cheap supplies from places like Home Depot and IKEA. Sometimes even Walmart can have a hidden gem if you look closely.

                Expense 3: Photography

                Do it yourself! iPhones have good cameras. DIY photography will save you some money.

                Expense 4: Cleaning Services

                This is included in the starting costs, but you will eventually end up spending on cleaning services. The best way to save money is to do it yourself initially if you have the skills and experience.

                If you have no experience or you don’t want to invest time in cleaning a place. Then your best bet will be to hire a professional cleaner. This can cost you anywhere from $50 to $250 depending upon the size and location.

                Expense 5: Legal Consultation

                Maintaining a professional relationship with a Real Estate lawyer can be very helpful in the Airbnb business. Airbnb regulations keep updating and you would need some legal guidance on the way to adjust your business accordingly.

                They can also come in handy if you face any legal issues with the landlord or guests. They can help in damage claims and insurance as well in case of any mishappening.

                how much can you make on airbnb

                Legality and Regulations in Chicago

                Chicago Government site provides more information about Chicago’s shared housing rules, including occupancy restrictions, guest record keeping, and minimum stay requirements. Penalties for violating these requirements may result in the suspension or cancellation of your registration number. You may also be fined. 

                Visit the City of Chicago website for more information. 

                 The City of Chicago requires a “vacation rental” license. Section 46300 of the Municipal Code contains information on licensing procedures and the responsibilities of holiday rental permit holders. 

                Vacation rental houses can be advertised or published through platforms such as Airbnb, but they must be registered and approved by BACP before they can be listed on the intermediary platform. 

                The landlord must publish the permit number of his property on his listing. Additional details are provided on the City of Chicago Commercial Licensing page, including fee and process information. 

                • Bed and Breakfast Permit

                 The City of Chicago requires a “Bed and Breakfast” permit. Section 46290 of the Municipal Code contains information on the licensing procedures and duties of bed and breakfast licensees. 

                 B&B can advertise or publish rental information through platforms such as Airbnb, but it must be registered and approved by BACP before it can be listed on the intermediary platform. The landlord must publish the permit number of his property on his listing. Additional details are provided on the City of Chicago Commercial Licensing page, including fee and process information. 

                • Hotel License 

                 The City of Chicago requires a “hotel” license. Section 46180 of the Municipal Code contains information on licensing procedures and the duties of hotel license holders. 

                 hotels can advertise or publish rents through platforms such as Airbnb, but they must first register and obtain BACP approval before they can be listed on the intermediary platform. The landlord must publish the permit number of his property on his listing. Additional details are provided on the City of Chicago Commercial Licensing page, including fee and process information. 

                • Zoning Regulations

                 The Chicago Zoning Regulations stipulate the city’s zoning requirements and land use. You should refer to the Zoning Regulations and the Shared Housing Amendments to the Municipal Code in 2016, 2017, and 2020-here to see if your list covers any zoning requirements or definitions of use. 

                •  Taxes 

                 Chicago imposes a 4.5% hotel room tax, a 4% shared housing surcharge, and a 2% domestic violence surcharge, including any cleaning fees for bookings of 29 nights or less. Airbnb collects and remits these taxes and fees in Chicago. For more information, please click here. 

                Cook County also imposes a 1% hotel accommodation tax on list prices, including any cleaning fees for bookings of 29 nights or less. Airbnb collects and remits this tax in Cook County. 

                • Other rules 

                 It is also important to understand and abide by other contracts or rules that require you, such as rules for leases, apartments or cooperative committees, rules for homeowners’ associations, or rules set by tenant organizations. Read your lease, and if applicable, consult your landlord.

                 Reasons for these laws and regulations 

                 As more and more commercial investors enter the vacation rental business, these laws and regulations are formulated to control the general rental market in the region and make accommodation affordable for locals. 

                In the next section, we will be suggesting the 2 best areas to start your rental arbitrage journey in Chicago. For specific neighbourhoods of these cities and data of different cities check out Airbtics.  

                References: Airbnb | City of Chicago

                Best areas for Rental Arbitrage in Chicago

                Some obvious places come to mind when thinking of Chicago like Heart of Chicago, and West Town. You can consider these areas when buying investment properties in these neighbourhoods of the Chicago real estate market. 

                 Chicago’s population and employment growth are accompanied by economic growth elastic, which promotes the growth of the Chicago real estate market. West town promotes the city’s Airbnb business. As a real estate investor, given the positive financial metrics of Chicago short-term rentals, investing in Airbnb rental properties in Chicago is recommended. 

                1. West town 

                rental arbitrage chicago west town

                According to our Airbtics Dashboard, West town is the top market to start your Rental Arbitrage business. Overall, there are more than 9,948 Airbnb listings out of which 1 bedroom is 3,112 in Chicago where Airbnb helped in Monthly revenue for most properties being more than $2,000/month with occupancy being more than 44%.

                2. Heart of Chicago 

                rental aribitrage chicago heart of chicago

                According to our Airbtics Dashboard, the Heart of Chicago is the top area to start your Rental Arbitrage business. Overall, there are more than 4,000 Airbnb listings out of which 1 bedroom is 1,400 in Chicago where Airbnb helped in Monthly revenue for most properties being more than $2,258/month with occupancy being more than 56%.

                See Full Stats for Chicago  – Click Here

                FIND STATS FOR YOUR CITY – CLICK HERE

                Read More:  Rental Arbitrage California

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