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I’ve been trying to figure out how to analyze a new market for potential AirBnb investments, like cities/countries etc… to see how profitable/risky they are and what opportunities they can give.
So far I haven’t managed to find anyone teaching this step anywhere, AirDna seem to help with that but for huge fees ($100) for every city and on top of that they charge more fees for deeper analyzing i.e neighborhoods ($40).
So they’re not an option for now, I’d rather learn analyzing myself.
I’m trying to find a country that:
Has a good amount of tourism
Doesn’t have an over saturated market like Barcelona or Paris
Has loose regulations towards short term rentals
Preferably cheap rents
Basically anything considered good for ab Airbnb host to prosper
I know you didn’t ask but it seems like a terrible time to be looking to “invest” in Airbnb properties. The primary reason is uncertainty as to to Covid but the second reason is negativity towards investor hosts who turn formerly residential areas into defacto hotels.
It sounds like @Noa may be looking at investing while real estate prices are taking a dive. IMHO it will take at least a year after we have a vaccine for business to pick up, and another 2 years to a robust travel industry, and 5 years from now we might be where we were a year ago.
Except that’s not happening. And there’s no guarantee of an effective vaccine ever being available. Thing is, we are in an unprecedented situation. So trying to use old rules (buy when others are selling!) may not apply. Shoot, if I had tons of capital sitting around I’d do the same, but it’s not for everyone.
Notice though that “cheap rents” is on the list and rental arbitrage is a special kind of risky. “Loose regulations” on rentals only have one direction they can go: toward stricter regulation.
Home sales in Southern OR have spiked to their highest record for the last two weeks. Its astonishing really…If I had money, I’d be waiting for lots of foreclosures this fall, but now I’m thinking my “thinking” is off.
It’s a reflection of the mis-distribution of wealth in the country. There was a shocking employment report out today. I’d love for it to hold but I know a lot of layoffs (like in the Airline industry) were not reflected in the numbers. It’s probably a “dead cat bounce.”
I once worked for a guy that did just that. He bought underperforming apartment buildings during market downturns. Every 5 years, he refinances all his properties and leverages his equity to buy more. He bought 3 buildings totalling about 180 units when the price of oil took a dive in the 1980’s and people were leaving the tail end of the post-pipeline boom, and there were a lot of vacant apartments, and they were profitable about 3 years after his purchase.
This time around, even with financial crash, pandemic, and the lowest oil prices since the 1950s, Alaska home prices are staying steady. There is very little new construction, though. I think that commercial real estate, especially restaurant locations, will take a hit.
And there are a lot fewer Air listings now. I’m there, but blocked, as are most of us here. I’m sure some went back to LTR — with no summer tour company employees, there are actually summer apartment vacancies for the first time in years.
Here’s where I think differently - Covid19 really did take a toll on the industry but it sure created new opportunities for new players to enter the game by taking out some of the old ones.
As for the negativity, so far I only know of that in bigger European cities or in U.S cities where people demand regulations. But regulations in developing countries? I can’t see that happening.
Where there are many tourists, locals can’t say much
I’m in the US and live in a low regulatory environment state. On top of that it’s a poor city and we have little in the way of tourism. I do like knowing that Airbnb is not going to be regulated anytime soon in my city. I like knowing I’m not taking housing off the market in a high rent city, etc.
The main risk is political uncertainty. I was a history and government teacher for 3 decades. So in a time of so much uncertainty, inflamed by covid, it adds a level of risk. Also, I live on the border with Mexico. I know folks personally who had property there (places like Puerto Penasco) who had to sell when the drug wars started. I had a friend who was going to go teach in Venezula, luckily for her the instability reared it’s head before she got there. A friend was looking at starting to do vacation rental in New Zealand where she lives then the country shut their borders to tourists.
Starting a businesses is always risky. This time feels different. If you are confident it’s not and this is a good opportunity, go for it. Hopefully you have deep pockets and aren’t going to leverage to get in.
Predicting where the next revolution is going to be is tricky.
I guess that you didn’t read around here much before you posted? If that’s not the case then if you had read a little before diving in, you’d know that I probably have more competition than most hosts - and it’s nothing I ever worry about.
You’d also know that if I were a pessimistic person I wouldn’t have been in this business for as long as I have. I do wonder though about your assertion that this business is ‘living hell’ for some people and ‘easy as pie’ for others. What do you mean?
Yes, I realise that - for most it is most probably the middle course. But I was wondering if you could elaborate. Remember, this is a public forum that gets a lot of traffic so I imagine that there are potential hosts looking at your comment and wondering about those extremes. It’s always as well to be prepared.
I’m sure it won’t but we are a public forum here - call it a knowledge base if you like - so it’s always helpful if members add to the general knowledge. All hosts are different and it’s always a good thing to have several points of view. That way, readers can make up their own minds.
By the way, I can’t see me getting tired of the STR business after all these years - but good point, but I think I’ll wear away first.
I would wait and see. Now Lots of countries are still closed to tourism. I am in South Florida and here business is booming. Both of my properties are full till August at least . This is actually my best summer ever for past 5 years. I can see hotels at the beach are all full.
But still lots of uncertainty. May be we are in this shock period after lockdowns.
I would definitely wait and see for after Europe and rest of the world starts to open borders.