Airbnb Arbitrage: How to Make Money with Vacation Rentals 💰🔥| Founders Club ft. Jerry Conti

Feb 25, 2020

Imagine making $10K per month per property on luxury homes YOU DON’T OWN and having the option to stay in those high-end homes when they’re available… The increasing popularity of home sharing sites like Airbnb, VRBO and Expedia make it possible to make a lot of money on luxury vacation rentals—whether or not you have the capital to buy a million-dollar home yourself!

Connect with Founders Club Host Oliver Graf on Instagram: @OliverGraf360

Jerry Conti is the Cofounder and CEO of LuxHomePro, Arizona’s top short-term rental (STR) marketing and booking specialists. Jerry’s team manages a portfolio of 22 luxury properties in the Scottsdale area worth $23M, capitalizing on the millions of travelers seeking high-end properties through online travel agencies to generate returns of 100% to 500% in monthly revenue. LuxHomePro also boasts an education arm, helping entrepreneurs start their own luxury vacation rental business in markets across the country.

On this episode of Founders Club, Jerry joins Oliver to explain how his vacation rental model works, discussing why he prefers the lease option and the luxury niche. He walks us through the process of finding a property, addressing homeowner objections, financing the deal, and negotiating an option contract. Listen in for Jerry’s insight around what to look for in a STR property (and how to price it accordingly) and learn the skill sets you need to run a successful vacation rental business.

Key Takeaways

[1:16] How Jerry’s vacation rental model works

• Look for luxury property on market 12+ months
• Approach homeowner with idea to cashflow as STR
• Bring in investor after year once proven concept
• Continue to lease from investor as vacation rental

[7:18] Why Jerry prefers the luxury niche

• Generate $700 to $1500/day on single property
• Use for own mastermind events

[14:16] How Jerry finds properties

• Use Airbnb/VRBO to research areas, occupancy rates
• Generate list of homes for sale on MLS and visit area
• Negotiate with homeowner to put together deal

[21:49] Your options for structuring a STR deal

1. Buy property for vacation rental
2. Lease method
3. Partner with homeowner as host
4. Seller financing
5. Foreclosure deals

[29:55] Jerry’s advice on getting a lease under contract

• Negotiate option to purchase (even when overpriced)
• Disclaimer to exit lease should regulations change

[35:40] Who Jerry’s team negotiates with

• Preferably homeowner themselves
• Give realtor fee to help make deal

[41:00] How Jerry addresses common homeowner objections

• Security checks, cameras and NoiseAware system
• Secure damage waiver insurance policy

[46:12] What Jerry looks for in a property

• Open concept kitchen + right bed configuration
• Amenities (pool, hot tub and room for gaming)

[52:26] Jerry’s insight around pricing a STR

• 80% of revenue should come from weekends
• Weekday rate about 1% of goal for month
• Consider low and high season + special events

[1:00:10] Jerry’s approach to mitigating neighbor concerns

• Apologize as necessary, respond to Airbnb asap
• Systems in place (i.e.: house rules in manual)

[1:06:19] The key to running a successful Airbnb

• Know your numbers and optimize listing
• Personal connection earns positive reviews

[1:12:05] How Jerry keeps his STRs immaculate

• Put energy into training cleaning crew
• Quarterly inspection of appliances

[1:18:30] Jerry’s tips on the check-in and check-out process

• Promising early check-in can jeopardize experience
• Let guest buy day before for half price (if not weekend)

[1:26:40] What surprised Jerry about the STR business

• Need multiple skill sets to be good operator
• Must get joy from providing great experience

Connect with Jerry

LuxHomePro

Jerry on LinkedIn

 

Connect with Oliver

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