Ep. 110 WHY YOU Should NEVER Buy An Airbnb / Short Term Rental!

In today’s video I talk about buying Airbnb properties as short-term rentals and go in depth about three important mistakes to avoid ⬇️

1️⃣ Never buy a property based on Airbnb financials

2️⃣ Overestimating the rental rates

3️⃣ Underestimating the expenses

Understanding how to analyze long-term rental rates, underwriting the property, and considering multi-family properties as a consistent and reliable source of income is the key to real estate investing in my opinion.

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Video Translation:

In this video, I'm gonna explain to you why you should never buy an Airbnb based off the income that the property brings in on the short term rental. My name is Jason Lee, I'm a multi family real estate investor here in San Diego and I also own my own commercial real estate brokerage with 11 amazing agents. Let me start off the video with a very quick story on how my client's friend lost his ass and is now in pre foreclosure about to get his property taken by the bank because he bought a property based on airbnb financials. My client's friend, long story short, bought a three bedroom house in Phoenix, Arizona and bought a duplex here in San Diego. The numbers worked very well with the airbnb short term rental rates like it was a double digit cash flow return. He was like great, let's do it. I'm excited. I'm going to buy these properties. This was end of 2021 middle 10 to 2021 when the economy was great. So the short term rental rates were going crazy. The market was hot, things were great and everyone was making money whether you're smart or stupid, right? But then recession happened, rates skyrocketed. People are getting laid off left and right from Facebook, Google Tesla, etc. This caused a lot of short term rentals to get hit in certain areas. This person and a lot of other people that I know that are in my circle are losing money right now. I'm going to tell you this video on the three mistakes that you need to avoid so that you never lose money on buying real estate mistake. Number one, the most important mistake that you should never ever buy a property based on the airbnb Financials or pro former pro former, meaning that this is the market income that an Airbnb will bring in a month. Let me give you a quick example. In San Diego, a one bedroom goes for about 2000 to $2200 a month with an Airbnb Pro form A that can be juiced up to 4002, even $6000 a month with short term rental rates here in San Diego. So a one bedroom will go for anywhere from 1 52 to 50 a night for a good location. The bad thing about this is if you buy base the numbers of the airbnb and the property can't carry itself on the long term rental rates and you can't pay the mortgage, you are taking a huge risk. Let the airbnb Financials be like icing on the cake but never utilize that to actually buy a property. Let's say you look at a fourplex or even a house in San Diego, you always want to run the numbers...

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