How to Start an Airbnb Business Without Owning Property

Since its launch in 2008, Airbnb has grown into one of the world’s most popular online rental platforms. And at this point, it’s no wonder more and more people are being persuaded to get into the business. However, most people also assume that in order to become an Airbnb entrepreneur you must buy at least one property, and this has in most cases prevented non-owners from even planning to get started.

But that is a big mistake. The truth is, there is a business strategy that can help you make a profit on Airbnb without owning or buying real estate. This strategy is called “subletting,” and you can read more about it here.

sub-letting and management

By definition, subletting takes advantage of rental arbitrage Model. In rental arbitrage, you use other people’s property to make a profit for yourself. First you need to find a property for rent, call the landlord and propose to him the idea that you use his space as a short term rental on Airbnb. Once you get confirmation, draft an agreement and get your business off the ground.

is this legal Yes. Just imagine yourself as a shop owner renting a space in the mall. The owner of the mall receives rent from you and you earn from his space – it’s a win-win situation! Plus, you’ll even learn how to run your business without having to buy the entire building.

See also: 6 ways to become an entrepreneur without starting from scratch

Subletting – advantages and disadvantages

Before you jump in, you might want to know what you’re getting into. So here are some of the pros and cons of this strategy for your Airbnb business.

Advantages:

1. You don’t have to buy a property. Therefore, the start-up costs are low.
2. Airbnb does the marketing for your business.
3. From here you can build up your income and invest in other ventures.

Disadvantages:

1. Your monthly bookings on Airbnb can fluctuate.
2. You are responsible for any damage and must pay for any additional incidental charges in your rental property.

Well, if you are ready for all that and have decided that subletting is a good solution, then it’s time to look for the best type of property to rent and airbnb.

See also: Creative Financing Strategies for Real Estate Investments

Subletting within your budget

Typically, to rent a property, you enter into a 12-month lease. If your capital is a bit on the low end, you can opt for a studio, one-bedroom, or two-bedroom house with monthly rent of $1,500.

After paying the first month’s deposit, you can set up your furniture, add some decor, and take professional photos. These photos will be uploaded to your Airbnb site and will be the first thing your guests will see.

Of course, depending on your capital, you can opt for a larger room. But all of this can also be done if your budget is between $7,000 and $15,000.

Also see: 7 quick ways to make money by investing $1,000

Three things to check

1. City Ordinances. The first thing to do is make sure you operate in an area where Airbnb rentals are allowed. Approximately 97% of US cities permit short-term rentals with or without a permit, but at least 3% do not permit operations in their area.

To do this, I would recommend searching Google for the phone number of the local building authority in the city you are planning to start in and asking for their ordinances. This will help you save more time for the process.

See Also: Judge Denies Airbnb Offer to Stop San Francisco Ordinance

2. Ownership Standards. Not all properties can be sublet so you need to make sure this is up to your standards. First of all, your property should be within your budget. It would be ideal if you could get a place with parking for two or more vehicles.

Secondly, air conditioning and heating must already be installed. This ensures that you don’t have to go through the hassle of installing air conditioning and heating with your money.

Your property should also be already renovated, because you don’t want to renovate a property that you don’t own. Also, if you can get a property that is already fully furnished, that would be even better for your budget.

3. Location of the property. There are areas that you must avoid when looking for a property to rent. These areas include properties near train stations, busy roads and congested corners. This may not seem necessary, but these areas can be noisy and distracting at times. Your guests have booked your spot to relax, and they can’t do that when they hear the constant honking of incoming trains or cars.

These are just some of the most important things you need to know when starting an Airbnb business through subletting. This can be your first step in creating long term prosperity for you, your family and future generations.