Gen Z's new side hustle: getting rich off Airbnb

"Imake $180,000 a month off of properties I don't even own," Hailie Anderson, who's 21, brags matter-of-factly to her 30,000 followers on TikTok. It may sound too good to be true, but she's engaging in a trend that's come to be known as Airbnb arbitrage, where entrepreneurial lessees rent out their apartments or homes on short-term-rental sites, hiking up the nightly price to make a profit on top of what they owe their landlords. It's not uncommon. Most seem to do it quietly. Anderson, however, is part of a particularly brazen and typically young cohort of hosts who flaunt their side hustle online, critics — and in some cases the law — be damned.

Arbitrage hosts like Anderson take to TikTok, YouTube, and Instagram to offer advice and promote paid courses on how to start and build your own short-term-rental empire. Anderson herself was inspired by other arbitrage influencers. She started two years ago, renting three apartments in the same building in Austin when she was 19, she says. Anderson spent several weeks furnishing and decorating the apartments (invariably sleek and minimalist, with gray and white couches and linens and abstract wall art), uploading well-lit photos, and managing the bookings. Today she has nearly 50 places listed on Airbnb in Salt Lake City, Austin, and Nashville under her property-management business that she runs from Florida. Plus, she side-hustles with her part-coaching, part-influencer online business.

From Donald Trump to Dave Ramsey, rich and successful (actual or seemingly) real-estate personalities have long offered tips and tricks for others to follow in their paths — and selling that advice can be wildly valuable. These Airbnb-arbitrage coaches, many of whom say they are or appear to be in their early 20s, are the Gen Z versions of '80s-era Trump, or social-media twists on HGTV shows, combining the ideas of a 5-to-9 side hustle, passive income, and TikTok clout. They document themselves shopping at Target for throw pillows, art, and kitchen essentials to stock in their apartments, answering emails, and touring new properties. A 25-year-old TikToker with the handle @airbbnbmastery101 titled one video "How to quit your job in 2024 and get rich." Another, Inayah McMillan, previously told Business Insider that she earned more than $300,000 in 2022, at age 20, and her coaching site boasts more than 2,000 students. They claim to be a new type of real-estate mogul — tycoons who reign supreme without even holding a deed.

Not everyone is thrilled about this. This style of short-term hosting bumps up against tighter restrictions as local governments push back on the proliferation of short-term rentals. Opponents say Airbnbs take long-term housing off the market and contribute to rising rents: A Zillow report found earlier this year that rent growth had outpaced wages in 44 of America's largest 50 cities since 2019. New York last year enacted a licensing system that effectively booted whole-apartment rentals from Airbnb unless people were looking to book them for 30 days or longer. Cities around the world are scrambling to curtail Airbnb by making onerous restrictions or outright banning short-term rentals, as Barcelona has said it will do in 2028.

But online, business for these hosts appears to be booming. Anderson's TikTok shows her travels through Europe and Asia and a day in the life running her business, which can include working from a cabana with a water slide. The job involves lots of reaching out to landlords (sometimes hundreds in one city, Anderson says) and inquiring about running short-term rentals in their properties; managing a staff; sending in cleaners; and chatting with guests. She says she pays about $100,000 in rent to her many landlords each month but can pocket as much as $80,000 during busy travel seasons across bookings on Airbnb, Vrbo, and Booking.com and from those who come to her directly. But she's also filming videos and teaching courses, making TikToks, and traveling to conferences.

Despite the profits, Anderson sees herself as immaterial to the real-estate quandary — and she says she rents properties that are legally approved for short-term renting, fully disclosing to landlords what she's doing. "I don't think me personally having 48 Airbnbs is single-handedly affecting the whole entire housing crisis," she tells me. Some of her commenters put the blame on her, but Anderson thinks there are plenty of leases to go around. The housing crisis "goes a lot deeper than that," she says. "There's a point where I try not to feel too guilty about it. But also, every single business negatively affects something in the world."

Her Airbnb profiles have around 2,000 reviews that average out to about 4.9 out of 5 stars. Hundreds of people have signed up for her online courses, which cost as much as $2,000 and include videos and templates on topics like reaching out to landlords, furnishing Airbnbs, and understanding leases, along with weekly Q&As with Anderson and access to a Discord community. She shows people how to write lease addendums that permit subletting and which software to use to manage properties and calculate prices. While angry mayors and residents point their finger at Airbnb for raising rents and bringing partiers to neighborhoods, she sees it as an opportunity for those to start their business with little to nothing. And flaunting the business on social media or at conferences has helped her find more guests who want to stay and led to new apartment leases. "I started this because I didn't have money to buy a house," she says. "If I can help 700 people not have to work their whole life at a 9-to-5, then why not?"

There's no way to know for sure how popular Airbnb arbitrage is. Airbnb did not provide data on the number of hosts who engage in arbitrage, and it's nearly impossible to tell from listings on the site who owns a property versus who hosts it. Jamie Lane, the chief economist and senior vice president of analytics at AirDNA, which provides data on short-term rentals, says that the arbitrage trend has slowed overall since 2018 and that the drastic decrease in travel and short-term-rental demand brought on by the COVID-19 pandemic led some of the largest companies in arbitrage to flop. Arbitrage is essentially what larger short-term-rental companies like Sonder do, or what those like Domio and Stay Alfred did before shutting down in 2020. They're designed to come in and manage many short-term rentals for a building.

But for smaller real-estate hopefuls, there's still a market. A big part of the appeal of arbitrage is that the startup costs are far lower than buying a property to use as a short-term rental, and some view it as an accessible entry into real estate. "It's still a great way to get into the short-term-rental industry," Lane says. As for those claiming to make millions: "Are there people making lots of money doing arbitrage? Absolutely," he says. "Is that the exception more than the rule? Probably."

In some cases, hosts have skirted the law to engage in arbitrage. Some do it without signing leases with landlords that allow subletting. In July, Konrad Bicher, an Airbnb-arbitrage host, was sentenced to more than four years in prison for defrauding landlords. The self-proclaimed "Wolf of Airbnb" had signed lease agreements on New York apartments and sublet them without permission. Between 2019 and 2022, authorities say, Bicher failed to pay more than $1 million in rent but made more than $1 million renting those same units on Airbnb and another short-term-rental marketplace. To keep the apartments under his control, he relied on government protections meant to help renters through the pandemic.

But Airbnb arbitrage, in theory, isn't illegal; it depends on local laws governing how short-term-rental properties are licensed. Still, rules could change at any time, leaving hosts on the hook for leases when they may no longer be legal to rent out short term. That's what happened to Tom DeRose, who operated an Airbnb-arbitrage company in New York with about a dozen apartments. When the regulations there changed in 2023, he pivoted. DeRose says that he regrets working in short-term-rental arbitrage and that "it's very clearly hurting" the housing market. Now he has a real-estate management company called HousingPanda, where he rents apartments in New York and then charges a premium for people to sublet them for either three or nine months. He says the leases are meant to appeal to students who live in the city for the school year or a summer internship.

Airbnb has recently made moves to make its stays look unique or personalized. Last year it pushed stays in homes with guests, a feature it called Airbnb Rooms, which harked back to the platform's original idea of a formalized couch-surfing and room-renting site. Then this spring it unveiled Icons, a set of decked-out, specialized stays in places like Prince's "Purple Rain" house or a recreation of the "X-Men" mansion. But ultimately, whether the company endorses arbitrage publicly or not, it profits from it: More listings mean more money. Airbnb did not provide comments on the popularity of the trend, or the coaching courses and online content, for this story. The company does have a guide to help hosts communicate with building managers about using properties as rentals.

I reached out to a handful of Airbnb-arbitrage hosts on TikTok who did not respond to interview requests. It's often difficult to tell from their videos what takes precedence: the hosting or the coaching. For Anderson, it's all a stepping stone of the way to her ultimate goal: owning property, which she calls "the real flex." (She would maybe one day even let someone run an Airbnb out of it, if she got tired of being in charge.) She says that she thinks about opening a boutique hotel one day but that it wouldn't be possible at such a young age without her foray into Airbnb. Still, "it's not get-rich-quick, easy money," Anderson tells me. It may not be as quick or easy as it looks, but she's certainly hit the jackpot.

Amanda Hoover is a senior correspondent at Business Insider covering the tech industry. She writes about the biggest tech companies and trends.