If you own a home consider AirBnB

This was pretty eye opening when I realized this because I am a home owner living in Redondo Beach, CA near the beach in a very popular area for visitors.

  1. Homes in equivalent size/standards are most likely being rented out in a traditional way near you.
  2. The rent for these homes ranges from 20-40% higher than your mortgage (most likely).
  3. AirBNB allows you to rent out your home in a very temporary manner per night which drives the price per day to ~600% or 6 times.
  4. If you can manage to rent half the time out of the year on AirBNB while living in your rental, you'll be making a nice profit.

Here's some example numbers.

  • Your home is $3000/month mortgage
  • A nearby home equivalent can be rented at $4200/month traditionally.
  • You can rent out your home nightly for $600 on AirBNB
  • This would come out to about $18,000 if you could do this every day but let's say you just rented it half the time, it would be $9,000 per month.
  • $9000 - $3000 - $4200 = $1800 profit per month which comes to $21,600 per year.

You end up making money even if you are pretty conservative in a busy area. Interesting.