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How Much Do You Have To Save for Your First Airbnb? – GOBankingRates

fizkes / Getty Images/iStockphoto …….

fizkes / Getty Images/iStockphoto

Looking to invest in your first Airbnb? That’s no surprise considering average daily rates are on the rise and demand continues to surge, according to AirDNA. As short-term rentals become a more lucrative investment, more people are wondering how to get involved.

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How much money do you need to launch your first short-term rental? According to the experts, it depends on your investing strategy. Here’s what you need to know.

Decide on Your Short-Term Rental Investing Strategy

Many first-time short-term rental investors are looking to buy a property and rent it out on Airbnb. But in today’s market, saving enough for a down payment is even more difficult than it was just a few years ago. Thankfully, buy-and-hold isn’t the only option anymore, said Michael Elefante, a short-term rental investor who owns and manages six properties.

“The cool thing about Airbnb is that you can really start with any budget and craft or choose which strategy you want to go with depending on your budget,” he said.

For those who have little to no money in savings, co-hosting can be a helpful way to gain experience in the Airbnb market.

“Co-hosting is essentially managing someone else’s property for them or even finding and evaluating a property that could be an Airbnb and presenting it to an investor you network with on Facebook, BiggerPockets, or social media,” Elefante said. “Then, you present it to them with your co-host fee, and they invest.”

Rental arbitrage or corporate housing is another lower-cost option. To use this strategy, you sign a long-term lease with a landlord, furnish the space and rent it out for nightly, weekly or monthly stays.

This strategy has become increasingly popular since the onset of the pandemic. Demand for travel nurses in November 2021 was 85% higher than pre-pandemic levels, providing an additional opportunity for those interested in rental arbitrage.

“If you cater to traveling nurses, there’s a huge demand for that,” Elefante said. “My sister-in-law is a traveling nurse, and she says it was very difficult to come by housing that was furnished and that she could rent out for one to three months at a time based on her contract.”

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Save Enough for Upfront Costs

Initial expenses will vary based on which investment strategy you choose. Co-hosting allows you to gain experience in …….

Source: https://www.gobankingrates.com/investing/real-estate/how-much-do-you-have-to-save-for-first-airbnb/

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