EP206: Investing in Airbnb Properties in Medellín

EP206: Investing in Airbnb Properties in Medellín

Are you looking for an ideal place to invest in short-term rental property for Airbnb? How about a little spot known as The City of Eternal Spring?

Vincenzo Villamena is the CEO and Lead CPA at Online Taxman and the proud owner of Airbnb investment properties in Medellín, Colombia. A digital nomad himself, Vincenzo chose apartments in the Poblado neighborhood in part because of its popularity with Expats. His ability to speak Spanish along with Medellín’s reputation for beautiful weather year-round make it an ideal place for Vincenzo’s Airbnb investment.

Today Vincenzo shares how he leveraged his expertise in accounting to unearth apartments in Medellín with significant ROI. He explains the city’s regulations, addressing how closely he follows the rules in each of his investment properties. Vincenzo discusses the factors he took into consideration when deciding where to invest, the process of negotiating with property owners, and how he used his IRA to buy one of the apartments. If you’re thinking about investing in property to rent on Airbnb, listen in for Vincenzo’s best advice—and learn why it’s important to make friends with the doorman!

Topics Covered

Vincenzo’s investment properties in Medellín

  • Two apartments, both in Poblado
  • 3BR for $90K, $10K in renovations
  • Studio for $50K, $1K in renovations
  • 10% net return on both

How Vincenzo deals with regulations in Medellín

  • Can’t rent for fewer than 30 days
  • Follows rule in 3BR, much demand for 30-day stays
  • Studio in smaller building, ‘under the radar’
  • Rents studio for shorter stays despite regulations

The benefit of investing in locations with fewer seasons

  • Higher demand throughout year
  • Higher occupancy rate

How Vincenzo used his IRA to purchase the 3BR apartment

  • Can roll over IRA or 401(k) into self-directed IRA
  • Use as personal investment vehicle
  • Not allowed to live in apartment himself
  • Can’t touch rental income (goes into IRA)
  • Avoid US capital gains taxes upon sale

The factors Vincenzo considered in deciding where to invest

  • Short-term rental pricing, ROI
  • Less speculation, 7% appreciation
  • Large number of digital nomads visiting area

Vincenzo’s advice for aspiring Airbnb investors

  • Know the market, choose place you want to spend time
  • Be patient, actively search for good deals
  • Keep an ear to the street
  • Doormen know where best deals are
  • Secure good lawyer, accountant
  • If deal seems too good to be true, it probably is

How Vincenzo negotiated to buy his investment properties

  • Residents known as shrewd negotiators
  • Bought 3BR from couple (lease-to-buy)
  • Negotiated for studio to include Smart TV, washer/dryer, kitchen supplies

Connect with Vincenzo

Online Taxman

Resources

Get Paid for Your Pad EP008

OLX

Connect with Jasper

Email: jasper@getpaidforyourpad.com

Twitter: @GetPaidForUrPad

Instagram: @GetPaidForYourPad 

Facebook: www.facebook.com/getpaidforyourpad

This episode is sponsored by Hostfully.com where you can create a custom digital guidebook for your guests!

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2 Comments

  1. Jon says:

    Hi Jasper,

    I have been to Medellin many times and would like to purchase a small Studio apartment in Medellin in a small building in Poblado or Laureles. I like spending time in Medellin so getting an apartment there makes sense to me. I would really appreciate it if you could get me in touch with Vincenzo, who might be able to give me some tips, preferably getting an apartment in the right building friendly for short term rentals. Thanks a lot man.

    -Jon

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