Airbnb is one of the fastest growing components of the hospitality industry. We are offering short term rentals as a solution for may of our investors. There is just one major problem: No NEW investment properties can be legally qualified for short term rentals. There is about 150 legal properties in the metro area that have been grandfathered in. The other 8,950 properties are operating illegally.
Legally qualified short term rentals must at least 4 of these major requirements.
Owner occupied 3 bedrooms or less – This pretty much wipes out all investors. The city is allowing folks that want to rent out a bedroom.
Township of Las Vegas – The property must be in the township of Las Vegas. There is a large section of Las Vegas that is actually Clark County and not in the township of Las Vegas. North Las Vegas, Henderson are cities who have codes that do not allow short term rentals.
Not in an HOA – This rules out most of your condos and 95% of your newer homes.
660 ft away from other Short Term Rentals – That’s pretty easy to find by searching Airbnbs on the map.
There are hundreds of rules & regulations if you fit those requirements if you meet those above. Nothing difficult. Just time consuming.
We can still manage your short term rental but we are not liable if you are shut down by an HOA or the local government. If for any reason, some government entity or local association prevents you from operating and Airbnb location, we will not be held accountable.
The property needs 3 conditions met before we start advertising:
- The property must meet our safety requirements. Fire extinguishers, smoke detectors etc.
- Limestone Investments must be “additionally insured” by your insurance company (this doesn’t cost you anything).
- The property must be properly furnished. This spreadsheet has basic requirements. The more features, the more money. If you want to furnish your own property, go for it. We charge $2000 set up the basic furnishings and will provide you an estimate up front. There is a lot to furnishing a property.
We charge 8% of the gross amount collected AND $500 to start up.
- All these fees need to be paid up front:
- Start up fee $500.
- Furnishing fee will be $2000. The cost to modestly furnish a 3 bed 2 bath is about $10k.
- We will get photos & video of the property.
- The Airbnb add will be created and you will have an opportunity to approve the add. You will be the co-host and we will be the host.
- We will settle your account near the end of each month. That settlement statement will include a report that has your income and expenses.
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.
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.
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 a short term rental 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. We go to “Plan B” which is to get longer term tenants. Less profitable but that’s life.
Should I purchase a short term rental 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 a short term rental if I can’t have it by the strip?
You will still make more money than a regular rental. 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 short term rental 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 short term rental?
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 a 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 $2000 to furnish the unit. This page covers a basic 3/2/2. This Airbnb cost about $10k to furnish. It was done with love, care and stuff we found on Craigslist. One thing we have discovered is that it is not practical to have 2 cooks in that kitchen. You either furnish it or we furnish it. We are not going to both work on furnishing it.
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 and lamps. If you want to see an example of our work, the video below will show you what we put together with used furniture from craigslist and yard sales for about $10k.
Now that it’s furnished and ready to go, how is the short term rental managed?
We assist you in setting up the property in your name. Here is our Start Page. That shows you how we crank up your short term rental. You 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.
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. Here is a video of how it works and what it looks like.
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.
How good are you?
We rock. Technically we are a SuperHost which means that when you are posted on Airbnb, your property falls in that category. Some travelers only book SuperHost properties because they don’t want to deal with amateurs.
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 7 property managers and a team of maintenance & accounting folks that take care of over 400 doors. Grab another cup of coffee and dig deeper…
- Property management FAQs.
- Maintenance and how it works.
- Investor purchase process: start here if you want to make money.
- Yelp Reviews