Why I Love The Rentals Business

Rental arbitrage. This would be applied to anything that you can arbitrage. This would be like an RV, right? A, you know, you bought an RV for $50,000 and you turn around and you put it on. There's Shalisa. Shalisa Thomas is in this group. This is what she does. She's got a whole business around the rental arbitrage. And so she buys these, you know, mid range campers, travel trailers, stuff like that. Not the big, big coachman, you know, the, not the big $150,000 pieces, but like the mid, the travel range ones and you know, 30 to $70,000. Well, she turns around and rents those out on various websites and she has local customers. She's in the Chicagoland market. She does things like eaa. She does, you know, which is the air show up in Oshkosh, Wisconsin. She does festivals and like 18, 20 weeks out of the year, she crushes it, you know, renting these units out and you could make 25, 35, 45% returns on the actual asset value. Now why is that interesting? Well, you could buy a G wagon or an Escalade or any vehicle over £6,000 and rent it out on Turo and make a return as well. We do it with the jet, right? We're arbitraging. We got the tax deduction in the jet and we have a contract on the other side. We put investors in the deal alongside of us and we're just arbitraging the equipment out, right? So I want you to think about that from a big perspective, especially if you're like making 200 to $300,000 and you're like, man, my only option is an Airbnb in a market right now where Airbnbs are getting crucified. I think that there's still some great markets no matter what, but there's no, no doubt about it that that business is down 30, 40% over the last 12, 24 months. And so it's not the only option. What are the things can I arbitrage and buy and write off against my active income and turn around and lease out? Is the name of the game here. And there's, I mean it could be applied to literally anything. I just looked at a waterfront piece of real estate up the road here. They rented out. There's called the Lagoon. They have jet skis and then they have these like, I forget what they're called. Catamarans. Four, five, six catamarans. Right? So essentially I wanted the real estate. I didn't want the business in this weird circumstance because it's like this historical piece of property with, like, 175ft of frontage. And I really wanted to make a move, but it was going to take, like, three years of red tape to be able to buy the property. The reality is the business was generating all the. All the revenue there. And the idea would be to, you know, to buy all the jet skis and buy all the catamarans and rent them out for, you know, six months out of the year here in San Diego. And so I love that because all the equipment's tax deductible. If you look at what the Sour Butts did, they bought a houseboat rental business. They bought a couple of houseboats and turned it into a business. All of those houseboats, the bank loved the deal because all those houseboats were. They could go non SBA because they were traditional debt. Lending against the houseboats is how that's set up. And then they got all the tax deductions in that. Dad's a doctor, son's a mortgage broker. It made a lot of sense for them to do that. And now they just rent out their houseboats for six months out of the year in Arkansas. And so I love the rental arbitrage business because of the tax advantages. I think it's a great business.