Making $180,000 a month without owning a single property? That’s what some young entrepreneurs are pulling off, thanks to an Airbnb arbitrage strategy. It’s a trend quickly catching on with Gen Z and young millennials who see real estate as a way to escape the traditional 9-to-5 grind without needing massive startup cash. Here’s how it works, why it’s attracting so many and why it’s not without risks.

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What Is Airbnb Arbitrage?

The basic idea behind Airbnb arbitrage is to rent a home from a landlord long term and then rebook it for a higher nightly rate on short-term websites like Airbnb ABNB. The key to making money is the difference between what you pay the landlord each month and what you make from short-term renters. You’re essentially running a hotel business without actually buying any real estate.

Hailie Anderson, a 21-year-old TikTok influencer, has become the face of this trend, making as much as $180,000 a month by renting out nearly 50 properties she doesn’t own. She’s part of a group of young hosts who not only leverage arbitrage to earn big but also flaunt it on social media, showing off their lavish lifestyles and selling courses on how others can do the same.

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Why Young People Love This Strategy

The biggest reason Airbnb arbitrage is booming is that it’s much cheaper to get started than buying a house. You usually just need to cover the first and last month’s rent and a security deposit to rent a property. Let’s say that’s around $6,000 – way less than a down payment to buy a house, which could cost tens of thousands of dollars.

As Hailie puts it simply: “I make $180,000 a month off properties I don’t even own.” For people like her, this was the ticket. According to Business Insider, she started when she was just 19, renting three apartments in Austin. 

With sleek furniture, clever photos and smart marketing, she quickly expanded her business to almost 50 properties in multiple cities. She made enough to pocket big monthly bucks while traveling the world and working from poolside cabanas.

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The Golden Goose … But At What Cost?

Of course, this “golden goose” strategy has some serious downsides. Tony and Sarah Robinson, real estate investors who run their own YouTube channel, have doubts about arbitrage. They own all their short-term rentals and believe that’s the better approach in the long run.

For instance, you don’t have full control if you don’t own the property. Landlords can decide not to renew your lease or sell the property, leaving you scrambling. You’re building a business on someone else’s property, which is risky.

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In their video, the Robinsons explain that when you own property, you get various tax perks, like mortgage interest deductions, cost segregation and even tax deferral when you sell and reinvest. With Airbnb arbitrage, you don’t get these benefits because you’re just renting.

There’s also the question of equity. Real estate owners build wealth through equity – the difference between what they owe and what the property is worth. When you arbitrage, all that equity goes to the landlord.

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Despite the downsides, Airbnb arbitrage can be an attractive option for young people looking to build cash flow quickly without huge upfront investments. It’s a great way to get into real estate if you don’t have the money to buy. But it’s not without its challenges – you must be comfortable with the idea that you’re always one landlord or regulation change away from having to pack up your entire business.

That said, Hailie acknowledges that she’s in a great spot to buy real estate now, saying, “Because I started Airbnb arbitrage, I am now in a position to be able to afford to buy real estate … which is obviously the end goal.”  

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