The 5 Airbnb Business Models and How to Make Money as a Host

Written on 12/24/2019
Alex Dabek


Whether you own a home or don't chances are you can make money with Airbnb. This will cover the 5 airbnb business models and which one you should use.

Out of the 5 business models we'll show you, 3 of them you don't even need to own a home!

If you want to make a full time income from Airbnb download our free app!


The 5 Ways to Make Money on Airbnb

These are the paths you can take with an Airbnb business. Whether you want to do one of these options or multiple it is completely up to you:

  1. Use your own home and put it on Airbnb
  2. Use the home you're renting as long as your landlord agrees (usually involves giving them a cut)
  3. HSMC - Find other people's property, convince them that you'll manage it on Airbnb and split the profit
  4. Rental arbitrage - get a lease for a house. Whatever extra you make from Airbnb is your profit
  5. Buy a property to put it on Airbnb


Most people will fall into number 1 or 2. And numbers 2, 3 and 4 don't require you to own a home.


How you can run an Airbnb

Airbnb hosting is very flexible. You can run an Airbnb however it suits you best. The following things apply to EVERY business model:

- Make as much $ as you want

All of these business models can be run full time, as a side hustle, or on a rare occasion. Airbnb is also scalable if you wish to grow a real estate empire.

- It's done on your schedule

You can choose which dates your home is available - as little or as many days you want.

- It can be passive income (optional)

One beautiful thing about Airbnb is EVERY business model can be automated. So you can be in a different country and still be making money while your rental is running.

- You can manage it from anywhere

The business can be run from anywhere as long as you have a smartphone and an internet connection.

Now here are the 5 business models you can apply this to. They are explained more in depth below.


1. Use your own home

Using your own home is most common and obvious business model for most people. You already own a home and you want to put your extra room or entire home on Airbnb.

You can convert a room into a bedroom. You can rent out your home when you travel. You can list the entire home and sleep in a hotel for profit. All the options are yours!

This has the most flexibility and it's the most profitable because you don't have to split profits with anyone.


2. Use the home you're renting

Using the home you're renting and using your own home are very similar. The only difference is if you're renting you must make an agreement with your landlord.

Usually, the landlord will take a cut, like 50% but you can negotiate terms with them.

There are ways to bring this up to your landlord. If you get an agreement - Boom! You are making money without putting a downpayment on a home.


3. HSMC

It's called a Home Sharing Management Company or HSMC.

This is an option if you can't do #1 or #2. An HSMC is also the most scalable option here if you want a full time business to grow.

This is managing Airbnb units using other people's property and without signing for a lease.

There are MILLIONS of homeowners who have an extra unused room or empty vacation home that's just collecting dust.

You will find these homeowners and pitch them on listing their extra room or home on Airbnb for a commission (usually 50% of the fees).

Then you start getting guests and collect the passive income that comes in each month through that listing.

You can reach out to the prime properties in your city or nearby cities. Zero ownership of any homes and no capital!

Check out Tai Lopez's course to learn how to make passive income with Airbnb step by step


4. Rental Arbitrage

Rental arbitrage on Airbnb is when you rent a property and rent out that property at the same time.

In simple words, you sign a lease with the homeowner then list the property on Airbnb and rent it out for a higher price. The difference between these two prices is your profit.

You should tell the landlord you're doing this and agree with them before. Usually, you don't need to give them a cut because you're paying a fixed monthly rent. If you do, then the cut should be small.

This is similar to a HSMC except it could be more profitable if you know it's a good property. A lease is a fixed price each month so if you do very well it could work better than splitting profits with someone.

The con is rental arbitrage takes more capital. You need a deposit and first month rent. You also have to get approved for the lease - which that alone could require a credit check, proof of employment and more.


5. Buy a property

You can buy a property for Airbnb. Obviously, this requires capital in the form of a downpayment.

You get all the flexibility of option #1.

There have been people who had super good locations and paid off the house in 3-4 years! That's not the norm but it shows there is huge upside in owning the property.

It depends but this can be way more lucrative than long term tenants sometimes.

You can start with a HSMC then work your way up to this (best way). You can find a property in a hot Airbnb location in another city. Maybe you already own a rental property and want to try Airbnb.


How much can you make on Airbnb?

As you see - Airbnb is possible for almost everyone. Now, you probably know which business model you want to choose.

How much you make depends on which business model you use, what city you're in, what your property is like and many other factors.

If you want to make a full time income from Airbnb download our free app!