Short-term Rental Arbitrage Financial Model (Airbnb/Vrbo)
Originally founded in 2007 by two cash-strapped roommates living in San Francisco, Airbnb (the popular short term rental site) has taken the business by storm with their innovative business model.
Did you know the term “Air Bed and Breakfast” originally came from the fact that guests were sleeping on an air mattress in the founder’s apartment? Accommodations (and expectations) have come a long way for Airbnb users, but the business is still thriving today.
Savvy business people are taking this even further by starting an Airbnb Arbitrage, defined as: the practice of renting properties and then subletting those properties through sites such as Airbnb and Vrbo. Cash from subletting pays the rent of the property and allows users to profit.
This financial tool, created in Excel by Smarthelping, allows users to explore leasing scenarios/ feasibilities and forecast profits/ expenses with smart built-in logic.
User input and logic determine the following reports: monthly and yearly cash flow analysis, minimum equity requirement, DCF analysis, IRR, ROI, and annual financial projections.
The template is user friendly and has capacity for financial planning of up to 100 properties.
