Investing in Airbnb Rentals with Andrew Keene


In this episode, Bill talks to Andrew Keene, CEO of Alpha Shark Trading. Andrew started trading in Chicago before quickly deciding to jump out on his own and start a company. Today, he’s not only a contributor to CNBC and the author of three books, he’s also a successful AirBNB host. Listen as Andrew shares how his experience in trading helped him to become a leading AirBNB host and short term rental master.

Time Stamped Show Notes:

00:07 – Bill introduces Andrew Keene
01:25 – Andrew has been a trader for a long time
01:36 – There’s always an alternative investment
01:49 – Andrew bought a place in San Diego

02:03 – “San Diego is very profitable”

02:30 – The return on investment for $350,000 is 35%
03:10 – There’s a petition in San Diego to ban short-term rentals
03:50 – Andrew is comparing a lot of smaller units

03:55 – If you put a one-bedroom and two-bedroom unit in AirBNB, the price is relatively the same

04:25 – “Chicago is a little bit difficult because you’re going to kill it in three months”
04:37 – Andrew’s cash flow from his San Diego property
04:57 – 80% of the people on AirBNB are just trying to get an extra income—that’s it.
05:02 – One of the biggest problem with AirBNB is this—it’s under almost constant litigation
05:16 – 20% of the AirBNB hosts are “Super Hosts”

05:43 – Andrew has yet to become a Super Host, but he is trying

05:54 – Advantages of being a “Super Host”

06:08 – AirBNB will promote you

06:27 – Andrew is starting a fund

06:37 – Andrew has a personal account from trading

06:57 – The big thing is litigation
07:05 – AirBNB is currently suing San Francisco, where they started
07:17 – Cities like New York are a little risky
07:28 – People are now after a premium for a house because you can AirBNB it—it’s inflating the cost for 1st time homebuyers, particularly urban home buyers

07:34 – If AirBNB gets shut down, you can still sell your unit at its original price

08:00 – ROI is still there in long-term rentals
08:06 – Premium for AirBNB is new and fresh and people don’t know about it
08:11 – There’s an AirBNB conference in San Francisco next month

08:24 – There will be about 6,000 hosts from around the world

08:30 – “There’s a whole ecosystem around AirBNB now like there’s an ecosystem around Uber”
09:10 – Andrew is treating AirBNB rentals as a long-term investment
09:35 – Andrew doesn’t believe in the stock market as a long-term investment
10:37 – Bill discussing Adam’s take, from the last episode, on property management and AirBNB rentals
11:06 – Bill’s team is currently working on the pitfalls of AirBNB
11:30 – How do you become a hotelier and a real estate investor at the same time
12:00 – Andrew puts only a percentage of his net worth to AirBNB and not 100%
12:30 – There are guests who stay longer than 3-days and make a copy of the key so they can go back at the property

12:38 – Electronic key is an option for keyless entry
12:53 – Nest

13:00 – Apps coming out for AirBNB

13:05 – Cleaning services app

14:10 – Do you think AirBNB will go away?

14:19 – “No. They are fighting and they have enough capital to have huge legal fees”

15:05 – There are hosts denying guests

15:30 – Charge the cleaning fee and service fee

15:45 – Instant booking is getting popular
16:35 – Andrew has never rejected a guest
16:40 – Andrew is using ReVestor and is impressed with it
17:17 – How ReVestor help with the negative stuff

18:09 – “Think about the worst case scenario”

18:20 – Books that Andrew recommends
18:48 – Andrew’s occupancy rate is 92-95%
19:00 – Andrew’s cash flow is $20,000 of $70,000
19:59 – Connect with Andrew through his email

3 Key Points:

Nothing in life is not guaranteed, and it sure as heck won’t be easy.
There’s a whole ecosystem around AirBNB, just like there’s an ecosystem around Uber—that creates long-term stability.
There’s always an alternative to traditional investments.

Revestor will run the average daily/monthly rental rates and average occupancy rates over live listings / homes-for-sale and will show you the properties with the most profit potential. View properties by the highest cap rate and cash flow. The platform will then allow you to adjust the numbers accordingly on each listing (see an example of this in action at the 17:30 mark of the video). Sign up for a free account here.

Resources Mentioned:

Get Paid for your Pad, Make Money on AirBNB, The AirBNB Entrepreneur, Lifestyle Entrepreneur and Secrets of the Sharing Economy – Books that Andrew recommends
Alpha Shark Trading – Andrew’s website– Andrew’s email address
AirBNB Open – AirBNB’s conference in San Francisco on November 17-1, 2016
Manor App, MaidsApp, Kleanapp and Tidy – Cleaning services app
Lockitron and UniKey – Keyless entry online tools
Revestor – Bill’s website where you can find short-term and long-term rental rate of properties


Show Notes provided by Mallard Creatives

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