| by Kenneth Chase | 100 comments

How I Make A Fortune On Airbnb Owning No Property | DONT BUY A HOME FOR AIRBNB IN 2019


welcome back Airbnb family today we’re
gonna talk about a discussion that has been passed around in my social circle a
lately which is whether it’s better to go for equity or cash flow when buying
your first Airbnb home now I have a very strong opinion on this and I’m sure
plenty of you do on either side of the fence but mine is gonna mess with you
here my opinion.. Don’t buy a home! don’t buy a single property if you want to be
an Airbnb host and there’s a very good reason for this we’re gonna jump right
into it it’s a very simple math problem if you want to have multiple Airbnb
properties and be successful as a business don’t buy your home so here we
go let’s say you are buying your first investment property you need 20% down
because it’s a non FHA you’re not gonna live there you’re gonna run out the
entire place on Airbnb which means since you’re not living there it’s an
investment property 20% down so let’s say you buy a $250,000 home with two
bedrooms and your 50,000 down you also need to upgrade it possibly and furnish
it so you’re looking at potentially $70,000 a month before you’re live on
air BnB now that two-bedroom property will profit you maybe $5,000 and that is
including your equity because you’ll have to pay property taxes utilities pay
for your cleaner etc and in this example the other person’s gonna pay for their
cleaners too so let’s keep it even so you’re gonna make maybe sixty two to
sixty five hundred dollars a month on your two-bedroom and your profit after
all the costs will be five thousand dollars including your equity and so
seventy thousand and five thousand dollars a month out okay that’s the
homeowner side now I rent my property i furnish them and then I short-term
rent them now let me tell you what I do with my seventy thousand dollars in this
situation I get ten properties right it cost me about seven thousand dollars per
that includes my cost of getting my first lease the furniture everything
okay so at ten properties my rents are probably about fifteen
hundred dollars in average with my utility costs sixteen fifty I don’t have
to pay property taxes everything’s worked into the of course into the rent
and I don’t have to worry about insuring my my appliances the landlord has to fix
the plan if they break things like that so 1650
and costs plus my cleaner costs I make about three thousand dollars a month of
my property so let’s say just you know conservatively I make nine hundred
dollars per unit so ten units that’s nine thousand dollars a month where
homeowner with their seventy thousand dollars is now making five thousand per
month so you can see I’m already ahead by four grand a month but it doesn’t
even end there so the cool thing about doing rentals is you can grow in smaller
increments the moment I have another seven grand I can put another property
and have eleven right so first month I make nine grand I can put seven thousand
towards another property I make another grand my second month I can put another
property down my third month I make another nine grand I can get almost two
more properties my third month so by month and a month three I’m looking at
about fourteen properties which is outstanding the person who owns a home
they need to actually make profit for fourteen months before they have seventy
thousand dollars again before they can get their second property now some of
you homeowners are gonna say well I gain valuation of my property because it’s
going to appreciate in value by like three percent on average a year well
let’s factor that in so let’s say that your $250,000 home makes 3% a year
you’re looking at about seven thousand dollars a year in appreciation so let’s
break that up to like six hundred and fifty dollars a month and appreciation
so you’re making five thousand now let’s add the 650 so you’re making fifty six
fifty per month including your appreciation I’m still making nine I’m
still weaponeer there but let’s talk about housing bubbles right you could
lose money on your property this could actually happen also you could buy a
home in a terrible part of town that’s not good for air B&B which means you own
it you’re gonna have to sell it or turn it into a regular rental property which
is not why we’re here we’re here to make more money than that if I get a property
where I lose money which I’ve done before I just cut the lease right I’ll
even buy it out early if I really want to get out of it fast so at worst case
scenario I’m stuck with a property for a year but it makes me more agile I’m in
I’m out I find the right neighborhoods and I make all my money that way and I
do this completely legally we’re gonna actually cover this in a very recent
like very near future video I’m gonna actually show you the legal process that
I take to pick up all of my leases and homeowners or
property management companies they can’t do anything about it they are stuck with
me at least to the end of the lease so we’re gonna talk about that later and
this is going to be the secret to making your fortune on Airbnb but to keep on
topic here don’t buy your property it’s sluggish it’s slow you need way too much
money to get in initially now you’re money stuck in your property if you have
to turn it into a regular rental which is no fun it’s just not nearly as
profitable and it’s a little harder to manage too because you’re stuck
replacing your own appliances so I don’t if it’s no breaks I’m like hey
maintenance come in fix my stove thank you goodbye and it’s a lot easier for me
to track my expenses too because everything’s kind of rolled into my
lease agreements so if you have any other questions kind of on this topic or
maybe even like just some fast facts on like how to host certain ways if you
have certain problems that you’ve had with guests or you know with your
listings feel free to leave me a comment below I’ll be happy to help you out you
just let me know what you need leave the comment now like this video share it
with your friends and of course if you want more content like this you
subscribe more is coming and I promise you very soon I’m gonna teach you the
legal way that I picked up my 20 properties without owning a single one
so thank you for watching air B&B automated I will see you on the other
side car

100 Comments

LunarOwl

Feb 2, 2019, 7:52 pm Reply

Lol what if you buy your own house for 20k in a giant tourist spot then buy about 5-10k of furniture. Is it a waste of money then? You'll make your money back in less than a year haha

Roma K

Feb 2, 2019, 11:38 pm Reply

People like you’ll kill this business,
This will prompt govt to heavy regulate this not to mention you’re killing the market for people to actually do need a place who live prices are skyrocketing everywhere

Valient Six

Feb 2, 2019, 12:37 am Reply

You don't actually do that. It's a good idea* but in reality your be out 50 percent that money in down time

Gabriel Chaix

Feb 2, 2019, 5:23 pm Reply

What about the equity you gain

Land Lord

Feb 2, 2019, 6:12 pm Reply

Yes that what I think to do, only thing ofcourse you must ask original owner if he is ok with it.

Alexandra Golovenko

Feb 2, 2019, 10:23 pm Reply

THese numbers are straight out of a fairytale. What property costs $50 K nowadays? Especially B&B worthy?

Edgar Ventura

Feb 2, 2019, 5:46 am Reply

I am very interested in starting my own business using airbnb any recommendations on where to start?

Vic R

Feb 2, 2019, 1:05 am Reply

Wouldn’t take this advice – VA Licenced REALTOR

jamie morrison

Feb 2, 2019, 5:28 pm Reply

It's usually a contract breaker to sub rent and you can get in shit with this

American Dad Life

Feb 2, 2019, 9:49 pm Reply

As a homeowner if I or my property management company found out this was happening I would take you to court.

Mo on the Go

Feb 2, 2019, 8:59 am Reply

I see no problem with this as long as landlord is okay and the properties are in good state. Its a win win situation and a very smart one indeed.

Stephen Cullen

Feb 2, 2019, 1:46 pm Reply

I doubt if many landlords in the UK would allow this, and I have no doubt mortgage lenders to those landlords certainly wouldn't!

Z

Feb 2, 2019, 12:45 pm Reply

You are full of nonsense, you absolute waste of time.

tim rich

Mar 3, 2019, 8:38 am Reply

Not true that's a lie 7,000 and you buy another property ?

Alex Barrera

Mar 3, 2019, 10:46 am Reply

How about cities that have laws against it?

MGTOW Rubicon

Mar 3, 2019, 7:52 pm Reply

Lease and sub-lease?
Profit from the spread?

Beautiful Souls

Mar 3, 2019, 11:41 pm Reply

Subbed Straight Away Thanks 🙂

G P

Mar 3, 2019, 1:38 am Reply

"Big boy" ? I/we don't know what state or planet you live on, but this idea ? or plan of yours is a wet dream… Good luck subletting an apartment/home you don't own….
please stop ✋ giving false ideas & hopes to ppl… It could really hurt them if "the shit hits the fan" when the apartment/appliances get damaged or break if not normal wear and tear …

Feras Twaim

Mar 3, 2019, 5:21 pm Reply

You forgot to account for the fact that for a homeowner putting 70,000 down, THEY WILL OWN A HOME. An asset, that can be sold when needed.

Sarah K.

Mar 3, 2019, 5:43 pm Reply

How do you get permission from your landlords to rent the flats out as Airbnb?

Gerrylynn Mako

Mar 3, 2019, 3:38 pm Reply

Expenses on Airbnb are different from long term. I do both in Hawaii on the island of Maui. Make money from both. There’s pros and cons to each.

Aaliyah Valentino

Mar 3, 2019, 12:26 am Reply

Ok.. problem. What it something breaks and you have a slowpoke landlord. You would have to stop and cancel reservations.

Cameron Mackenzie

Apr 4, 2019, 8:50 pm Reply

Where's the follow-on video which goes into further detail, specifically about the legal side?

jack317

Apr 4, 2019, 12:02 pm Reply

Bada book! Bada boom!

Wolfgang Amadeus

Apr 4, 2019, 8:14 pm Reply

Has anyone done this in Canada ? Is this legal over here ?

lyoelin

Apr 4, 2019, 7:11 pm Reply

1. 99% of owners won't allow this 2. permits crack down on this making it impossible

Jeff Donald

Apr 4, 2019, 4:57 pm Reply

Too bad it's not possible here in Vancouver, BC with such strict regulations! You can only rent out your primary residence for short-term rentals and if you get caught, which is likely, you get fined $1000 a day. It's times like these I wish I lived in the states.

Jorge50505

Apr 4, 2019, 11:07 pm Reply

The true people making money are the rental owners

Equity over profit!

1626ca

Apr 4, 2019, 11:27 pm Reply

Fucken scammm

Building Buildercip

Apr 4, 2019, 3:29 am Reply

Furnish a 2 bedroom for $7k. Pretty tough make it attractive enough for anyone to really want to stay

Building Buildercip

Apr 4, 2019, 4:24 am Reply

I’ll have to check it out. I’m about to drop just under $20k on my 3bed 3 bath , but I’m going higher end.
I’m not renting but I bought in cash. I appreciate your logic though.

Ahmed Elbially

Apr 4, 2019, 4:52 am Reply

Hi Sean, I’m a big fan of you since I’ve seen this video more than a year ago. Almost watching all your videos and contents. Can you please make a video with a detailed breakdown of a realistic listings income you already have ? I live in Houston and looking at the $900 per month income is kinda unrealistic/hard to make with 60% average occupancy rate.

Thanks for all the information. Keep it up !

bbyybda

Apr 4, 2019, 5:18 pm Reply

We are on the same boat. I made almost the same amount of revenue as you do per month when I had multiples properties at that time, in the same method you mentioned above. It’s a very very profitable business but also risky.

But now we are facing a lot of problems with the condo rules who are starting to take actions as there are more Airbnb hosts in the building. How do you deal with the property management companies in regards to those rules?

Ryan Delaney

Apr 4, 2019, 12:02 am Reply

Currently do not have any properties under my belt but I’m creating an LLC in Massachusetts and going all in on this idea. Would love to connect with anyone else just starting up or experienced.

Truly

Apr 4, 2019, 7:19 am Reply

I appreciate you from UK. Subscribed to your channel. How do I contact you?

catips

Apr 4, 2019, 3:39 am Reply

Hey

The Gabriel Family

Apr 4, 2019, 2:44 am Reply

I had a guest dispute once. They seemingly had a party. Messed up the carpets. Airbnb didn't think so. They didn't allow me to use the deposit that I required. How should I have dealt with that? The deposit was inaccessible. Then I found out that my heating bill was $700. I thought they had the windows open the entire time with the heat cranked up. I'm not sure how I should have dealt with that. Also, how to deal with theft and/or damage in general. Airbnb wasn't going to give me market price for the new items that I had just bought that were ruined.

Xa La Von

Apr 4, 2019, 5:22 pm Reply

You make money, your landlords make money. Win-Win

angelo bonavera

Apr 4, 2019, 2:52 am Reply

Is there a way to know how much a house is pulling in on airbnb? I'm new to this.

Cyber Samurai

Apr 4, 2019, 5:50 pm Reply

Which state is your business/company incorporated? Legal business name? LLC or Corporation?

john smith

Apr 4, 2019, 12:01 am Reply

Also some people may realize he is breaking the lease cintract and refuse to leave forcing an eviction and the law regarding the eviction process from an illegal bnb is murky at best.

karma in your face heh

Apr 4, 2019, 7:21 pm Reply

Wait are you paying 7000$ per month or per year?? Cus if per month, you're only earning 900$ a month from one property that's a huge loss.

karma in your face heh

Apr 4, 2019, 7:27 pm Reply

And subleasing requires proper license. You can't sublease without the homeowners permission.. and if you are subleasing you'd have to pay for the damage

Offsure

May 5, 2019, 11:19 am Reply

I'm a Military Veteran. You inspire me. Please let me know how I can partner with you and make some cash money. Maybe you can get two interested people to team up half and half financially on this rent business.

bobyahatovich

May 5, 2019, 2:22 pm Reply

Complete BS.

Geo Cyo

May 5, 2019, 3:34 pm Reply

This is such a great video! I had theorized that this would be a good idea several years ago but I couldn't figure out to put it into numbers and what potential pitfalls to take into account but yeah, this was great content!

Neelofer Khan

May 5, 2019, 4:49 pm Reply

Phone no to contact and email for one on one coaching.

Neelofer Khan

May 5, 2019, 4:52 pm Reply

HEY AIR BNB AUTOMATED CONTACT FOR 1 on ! coaching

aFreeman0409

May 5, 2019, 5:26 pm Reply

Subleasing? That is your secret?
What a load of manure.

High Frequency Radio

May 5, 2019, 11:47 pm Reply

Thank You for the video. Do not listen to these idiots who do not understand contract law. There is a reason why they are broke.

modjo3456

May 5, 2019, 12:03 pm Reply

What is your plan if there is a downturn in the economy and demand goes way down? How do you plan on keeping up with hundreds of leases if the cash flow dries up?

aFreeman0409

May 5, 2019, 3:13 pm Reply

My comments are getting thumbs up.
Are you seeing it???

Boss Dogg

May 5, 2019, 1:59 am Reply

Great information bud. I swear some of these people in the comment section are idiots. I own property that I rent out so the main objective is to keep tenants in those properties. Airbnb is awesome bc no matter what the landlord or property owner is getting their ?. Unless it's in the lease, or state law restriction, Airbnb is fair game… Great videos.. ??

Emil

May 5, 2019, 3:20 am Reply

How do you "get" 10 properties for $ 7,000 each? Do you rent it?

Richard

May 5, 2019, 10:04 am Reply

Do you pay a higher than normal rent to get the owner interested to let you lease the property? And you disclose that you are going to do air bnb?

haryabuntala

May 5, 2019, 12:19 am Reply

you wear suit, why?

N. P.

May 5, 2019, 9:05 pm Reply

as a landlord, If I was to see that this was happening in my property, I would hang you

Joyce Cooper

May 5, 2019, 1:19 am Reply

What about liability insurance ? Can you get insurance to cover renters since you don't own the property?

Warren Coquilla

May 5, 2019, 10:33 am Reply

How to deal with owners or agent if you do this thing? Should i tell them my plan to do with the property? Thanks heaps

Jennifer Davis

May 5, 2019, 3:34 am Reply

Duuude amazing. This right here! Can you please explain the type of lease contract needed? Thanks

Rafiu Oluwasina Ganiyu

May 5, 2019, 8:19 am Reply

Hello, I really enjoyed this video. I would like to know if a non – resident can get into airbnb business/investment.

Dipper964

May 5, 2019, 6:53 pm Reply

Finding apartments that allow subleasing is difficult

Mr Mok

May 5, 2019, 7:30 pm Reply

Shady Business 101. LOL

De Sac

May 5, 2019, 2:09 am Reply

2019 this lad thinks home owners are dumb!!

Irina Velichko

Jun 6, 2019, 8:09 pm Reply

Its a dungarees advise.

Dominic Manaligod

Jun 6, 2019, 4:25 am Reply

Sean thank you for the insight you gave during our local REIA meeting last thursday night. Is there a specific order I need to view your videos? Thanks.

Jeffery Hinchey

Jun 6, 2019, 5:49 am Reply

You are leveraging fully which makes sense, this is a leverage world, in for a penny, get in for a pound.

Joe Scaparra

Jun 6, 2019, 10:01 pm Reply

Recently bought a duplex in Bryan TX  and I am thinking of making one side a short term rental. I have zero experience in doing this so I thought I would ask for advice from those that have some experience.

The unit is totally rehabbed with new floors, paint, fixtures, lights, ceiling fans, granite countertops, new windows, bathtub and tile in shower. It is a 2 bedroom 1 bath and I have yet to furnish the place. It does have a washer dryer and all new kitchen appliances.  

I won't manage it myself looking at a couple of companies that take care of all management, they charge between 10-20% of gross revenue. 

Questions:

Does anyone have any recommendations for property management for this short term rental?
How should I configure bedrooms…..King, Queen, Full or Twin beds.
On average what should I anticipate for occupancy rates?
What are good daily rates for both event type dates….ie SEC Football Weekends, Parents Day, Graduation dates etc and just your run of the mill days?

I plan on using this property sparingly myself. 
I am sure I am leaving out some obvious questions so don't hesitate to add to this discussion.

Lorna Debbie

Jun 6, 2019, 12:53 am Reply

I would absolutely love to HOST you and yours: @t Please visit and stay in a cozy peaceful space after the days activities.

Vin ef

Jun 6, 2019, 8:17 am Reply

Hi, is starting an airbnb management better to do by yourself or partnership with other people? Is it possible to do the main work solo? Thank you

robinson lantigua

Jun 6, 2019, 11:14 pm Reply

greetings how would the part of the cleanings of each house be done when there were so many rented?

Walter Mercado

Jun 6, 2019, 7:31 pm Reply

This is basically subleasing and most landlords don't allow this.

Stuart Rosum

Jun 6, 2019, 4:42 pm Reply

Hi how you find a property to rent out for Airbnb thank you

Ary Masters

Jun 6, 2019, 7:21 pm Reply

What is not accounted for here is the fact that with a rental, 100% of your monthly payment is never earned back, where as if you own the home, your deposit and a portion of your monthly payments is earned back whenever you sell the home + equity made after appreciation. Lastly, 20% is NOT required on most conventional loans. You are able to do as low as 3.5% on conventional loans. 20% is only necessary if you want to eliminate the mortgage insurance.

AliveOnArrival

Jul 7, 2019, 10:00 pm Reply

Where are you getting units for $1K rent? How am I getting a landlord to get on board with this?

aksek hiddelll

Jul 7, 2019, 4:33 am Reply

because you are a money grubbing piece of shite that is ruinning life for everyone else, you are a scumbag

RC lee

Jul 7, 2019, 11:45 am Reply

Could you please talk a bit slower ? Thx

nsmcgirt

Jul 7, 2019, 5:10 pm Reply

This dude is a complete scum bag.

Fox

Jul 7, 2019, 6:14 pm Reply

Ima trucker if I buy a duplex with VA loan which means it can’t be assumed under an LLC so basically rental income won’t be taxed or even known can I long term rent one side and Airbnb my side while I’m away??? Also my city Orlando Airbnb laws says I have to live on the other side of the duplex that I am short term renting ??? (Loophole??)

Leea Robinson

Jul 7, 2019, 9:13 pm Reply

Do you have the permission of the landlord to do that or do you just do it without asking.

Sorry that's illegal ? real estate agent

Dean Martin

Jul 7, 2019, 10:09 pm Reply

Do you have a link to the follow-up to this video? If so where do I find it?

Tim Vandentoorn

Jul 7, 2019, 7:49 pm Reply

Who would allow another investor/tenant to sublease their property? This is a great idea in theory, but you should mentioning some level of due diligence, before blindly following this advice. While I sign and screen one tenant a year for my property, you move people in and out weekly and have a tremendous amount of overhead managing that. Additionally, if you report that your stove is not working as a tenant, I will be there in a day or two. If you EVER let a stove go on a Airbnb for two days before repair, your going hammered with negative reviews which is going to kill your business. Great ideas though…but there is more to it than the numbers you mentioned.

Food Curls

Jul 7, 2019, 8:40 am Reply

BS. Press thumbsdown

Maxwell Smart_086

Jul 7, 2019, 2:15 pm Reply

Sean – you gotta work on your outfit: 1. Only dead man wear square 2. A ties pocket square has to be in a different color than the tie (I know the cheap salesmen like to sell it to you in a pair…) 3. Men with style don´t use tie clips at all (that´s for clerks or jerks) 4. IF you don´t wear Versace – wild tie patterns are OUT 5. Shave – you look like a truck driver in a suit. Good luck – next try. 😉

WtfImdoinghere

Jul 7, 2019, 10:12 pm Reply

Illegal and you can be sued. Don’t listen this shit guys…

k a

Jul 7, 2019, 11:22 pm Reply

I’m a landlord and if you spoke to me like that after possibly one of your hotel guest broke a stove I’d tell you to do one and fix it yourself.

knyc taj

Jul 7, 2019, 12:48 pm Reply

Im listening to this thinking he's leaving out alot . he didn't speak about cost of leasing or renting.

Preston Davis

Jul 7, 2019, 5:46 pm Reply

I've heard recently that some areas are now requiring a permit to list short term rentals. Does anyone know if this applies in Atlanta?

Kane delars

Aug 8, 2019, 6:24 pm Reply

Thanks for the video, I list on Airbnb and on the app Musjroom, which is a great alternative for renting and booking rooms and lastminute couches. But lately im not satisfied with Airbnb customer service and the payouts in the Netherlands!

Shiyan Wang

Aug 8, 2019, 3:19 pm Reply

Super smart!

richard miller

Aug 8, 2019, 4:07 pm Reply

what a arse hole and he showed his face people have been ruined for less please dont do what he does

Adrian Niculescu

Aug 8, 2019, 7:33 pm Reply

Hey Airbnb automated, my name is Marius and need some help with an ideea of mine… Can you please give me an advice?

Is it possible for me to contact the owners of some cottages and propose them a deal in which I promote their property on this rental platform in exchange for a percentage?
Or something like that?
Thank you for answer.

kmusic

Aug 8, 2019, 11:15 pm Reply

Hahaah.. this guy is such a bullshiter….All of the apartments and rentals do not allow airbnb or any type of subleasing…This would work if you are able to find landlords or companies that are clueless…..

Max Maximus

Aug 8, 2019, 10:32 am Reply

As stated below, you are probably letting out on Air Bnb without Landlord knowledge or consent. In the UK most tenancy agreements have a condition that forbids sub-letting, so its a dangerous game you are playing, which might work in the short term, but you cannot build a sustainable long term business from this!!!

N SR

Aug 8, 2019, 1:23 am Reply

Actually a pretty smart idea (sub leading properties to Airbnb)
-no property tax
-no maintenance (property manager)
-less money down

Chels Martin

Aug 8, 2019, 9:30 am Reply

What if you don’t get any clients your stuck with paying rent for an empty apartment on many months!

S M

Aug 8, 2019, 4:22 am Reply

How do you get homeowners to let you sublease?

Pretty Alina

Aug 8, 2019, 3:05 pm Reply

LOL 1 look at you,i dont trust you

A Immortals Legacy

Aug 8, 2019, 9:27 pm Reply

This may seem petty.. but you included the appreciation and not the money that is being paid toward the principal.

Jiajun Fan

Aug 8, 2019, 2:26 am Reply

Doing business in a smart way is great, but it'd be fine if you could just keep your business model to yourself, now you are sharing it with everybody. Once they all do business in your way, more and more housings will go to short-term rental, less and less rental stock will be on market, harder for regular tenants to find places.

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