Can you help me purchase a property for an Airbnb?
Yes. We specialize in identifying excellent investment properties. Investors who want to be on top of their game START HERE. That page leads to further links that help even the most seasoned investors get the right property.
Can you guarantee that my property will be legal in Las Vegas?
No. We cannot guarantee that your property will be properly licensed. In July 2017, the City of Las Vegas has allowed licensing only with a Special Use permit. Properties that have been operating with a license will be required to have this special use permit by July 2019. All properties outside of the township of Las Vegas are currently operating illegally.
Where can an Airbnb potentially be licensed with a special use permit?
The pink area of this diagram. You will notice that very little of the metropolitan area of Las Vegas is actually in the township of Las Vegas.
Are you saying that all those thousands of Airbnbs that I see advertised are operating illegally?
Yes. 95% of those Airbnbs you see on the web are not licensed and could be fined or shut down for code violations. The meager 2% who are operating legally are now required to get a special use permit no later than July 2019. Of the 8,000 or so properties, only about 150 are properly licensed. Since no one has that special use permit, it's completely unknown as to how difficult it is or how long it takes. The City of Las Vegas could conceivably make that process so difficult as to shut down all Airbnbs.
What would happen if I buy an Airbnb and simply take my chances of not getting caught?
We don't know. We have no insight as to how Clark County, North Las Vegas, Henderson or the other tiny little cities like Paradise are going to deal with all these illegal Airbnbs. Our best guess is that they will focus on the properties that get their attention. Party houses or short term rentals that create a nuisance to neighbors will probably get their attention first. Like traffic cops, they can't physically stop everyone so they will probably spank the worst offenders and let the others go.
How can I get caught?
Your neighbor will snitch on you. If you buy a massive 5 bedroom house with a pool in an upscale neighborhood, your neighbor who drives a lamborghini is going to be pissed off when he finds condoms in his front yard after 30 people threw a party at your Airbnb. These "High Profile" houses are going to be the first on the list of code enforcement efforts. If you get a modest home in a blue collar neighborhood and offer a case of beer to Johnny Lunchbucket next door, you will probably get away with an Airbnb for a very long time.
What happens if or when I get caught?
You will get a love letter from code enforcement. We deal with code enforcement all the time. The love letter essentially states that you have x number of days to remedy the problem or you will get fined. Every love letter we have received had about a 30 day remedy and occasionally we had to ask for an extension. We were never denied an extension and the code enforcement officers we deal with are super cool. We know all of them and they all know us. We take care of code enforcement issues promptly and they love us for that. NOTE: The City of Las Vegas has like 3 code enforcement officers. Their hair is on fire. We think they will only deal with the Airbnbs that are getting a lot of attention from neighbors.
Should I purchase a property for an Airbnb that is in an HOA?
No!!! HOAs are really against short term rentals for fear of party houses. Condos are more likely to get hit by HOA violations. All it takes is a pissed of neighbor to turn you into the HOA police. If you cannot prove to the HOA that you have a tenant with a 30 day lease or more, they can fine you until you give up or they take your property. HOAs have sharper teeth than the government and they can legally eat your property.
Do all HOAs have 30 day minimum lease requirements?
Yes. We have not found an HOA yet that does not have a minimum rental restriction.
Are their many properties available that can be licensed near The Strip?
No. What what what? That's right. The Strip is technically in the city of Paradise. Pay close attention to the diagram above. The Strip is below the Township of Las Vegas. That little bitty section above The Strip is all that is near The Strip. That little section is in a rough neighborhood AND thousands of investors are fighting over what's available. Welcome to fight club.
What's the purpose of having an Airbnb if I can't have it by the strip?
You will still make more money than a regular rental. Preliminary numbers indicate that you will make about twice as much as a regular rental. We have a property in North Las Vegas (about 12 miles from the Strip) that generates twice the amount it used to rent for. Folks who have been staying there are not interested in gambling or partying like rock stars.
What can I do if I start up an Airbnb but the government or an HOA sends me a love letter to stop?
You can convert the property to a regular rental or make your minimum stays 30 days. All the cities and nearly all the HOAs allow rentals for 30 days or longer. You could still advertise on all the short term rental sites and just set the minimum stay for 30 days. An alternative is to convert it to a regular rental. It would not be the end of the world.
What is the best type of property to purchase for an Airbnb?
3/2/2s in a "C" neighborhood without a pool and not in an HOA. What the heck does that mean? That means a 3 bed, 2 bath, 2 car garage in an average neighborhood ranging in price of about $180k that doesn't have a pool and doesn't reside in an HOA. We have found that properties that doesn't fit that profile make a less return on cash. For example, a property that's in an awesome neighborhood that costs $360k with a pool, will make about 50% more than a $180k property. You would make more money with 2 $180k properties than you would with one $360k property. By the way, you are also more likely to get caught with one big expensive property in a "A" neighborhood than you will with 2 properties in a "C" neighborhood.
My mom always told me "location location location." Properties in "A" neighborhoods appreciate more than "C" neighborhoods right?
Wrong. That phrase is big bunch of hoooey. There is no correlation between appreciation rates and neighborhood quality. For example: properties in 89144 (one of the most desirable neighborhoods in Las Vegas) depreciated 11% over the last year because of all those buyers were obsessed with "location." ZILLOW REFERENCE. You are reading this page because you want to make money. Not to impress your friends.
Now that I have been warned that I may not be able to get a license, what happens after the property has been purchased?
You need to get it rehabbed and furnished. We can take care of that for you OR you can do it. We are a menu driven business. You can pick and choose what you want us to do. Generally we charge 10% over invoice for rehabs and we charge $1000 to furnish the unit. This page covers a basic 3/2/2. This Airbnb cost about $8k to furnish. It was done with love, care and stuff we found on Craigslist / yard sales.
What if I don't like your taste in furniture or finishes?
You can get someone else or do it yourself. We only offer that to help our investors. Furnishings are not our core business and we have never been featured on Architectural Digest. We honestly don't care if you roll up your sleeves and drive all over town in this heat picking up couches.
Now that it's furnished and ready to go, how is the Airbnb managed?
We assist you in setting up the property in your name. This enables you to keep control of the property and/or enables you to fire us at any time. We will become the "co-host" which gives us control over bookings and discussions with the guests. You will get to see all the dialogue between us and your guests. The Airbnb dashboard is pretty cool and you can use that to reference your monthly statements.
How much do you charge?
$500 to set up and 8% of the gross AFTER Airbnb pays us. What is confusing is the term "Co-Host". Most people who over "Co-Hosting" are not licensed property managers and they charge anywhere from 10%-15%. Airbnb does the process of splitting out that money. Our process is different. We do the splitting. We collect all your money and then give you 92%. We have to do it this way because we are doing all your cleaning and repairs.
How and when do I get paid?
On or about the 25th of the month, we will send money to you electronically. We take all the income and subtract all the expenses to determine how much money to send you. We send that money to you electronically. Your owner portal also enables you to see vendor invoices so you can dig deep into anything you want.
Do you take care of all the cleaning, check ins and check outs?
Yes. Cleaning fees will vary depending on the size and complexity of your lodging. A 3 bed, 2 bath house about 1400 square feet runs about $230. That includes cleaning and linens. That number will change as we dial in your property. Little piggies who leave your place a mess may cost more.
What else should I know about your property management?
Jim Eagan, president of Limestone Investments, wrote a book on the subject (A Fistful of Properties). We have 6 property managers and a team of maintenance & accounting folks that take care of over 350 properties. Grab another cup of coffee and dig deeper...