Does Rental Arbitrage Still Work in 2026? Markets, Landlords and Cash-Flow Strategies Explained

Jonny Harvey (00:00)
So the VRBO guest actually walked in on the Booking.com guest. So it was a double booking. So from there I had to act fast. And then so what happened was VRBO asked for money back because it wasn’t gonna come out of VRBO’s pay, it was gonna come out of my pay, so that was really… it was very embarrassing for me that that happened, and I made the guest the other guests really afraid and uncomfortable. So it was really a rookie move, you know, in the beginning of the year for me.

Freddie Steen (02:03)
Hey everyone, welcome to the Investor Fuel Podcast. I’m your host, Freddie, and today I’m joined by someone I’ve been looking forward to chatting with. Jonny Harvey of JP Wisdom, who’s been making serious moves in the real estate space, in the rental arbitrage white-hot space. Jonny, I’m glad to have you here. I think our listeners are really going to take something away from how you’re approaching rental arbitrage and scaling in multiple markets. Let’s dive in. You’re based in sunny Oakland, California. Now let me just imagine we walked out of Yoshi’s, got some good sushi, and for people who may not be familiar with you standing on that sidewalk, what’s your main focus these days, and what markets are you operating in?

Jonny Harvey (02:57)
Thanks for having me, Freddie. Yeah, my main focus is just building and scaling, really. So the the first market I’m I’m actually getting a unit in two days in Phoenix, Arizona, right by downtown. Yeah. Yeah, and then I’ll be I’ll be looking more into Dallas and Las Vegas next. So those are the two markets that I’m really looking forward to. Yes.

Freddie Steen (03:13)
Congrats. Sounds exciting. Tell our real estate pros who are building real businesses just like you, what drove you to the rental arbitrage niche as as an asset class?

Jonny Harvey (03:34)
Well, what drove me into it is so when I when I first started I ended up doing social social work, right? So then I got I got laid off in my social work job. Then from there, the spot that I was staying at in Berkeley, California, I mainly said, “Hey, let me just rent it on Airbnb, short-term rental.” So then from there I asked the landlord, “Hey, can I can I rent it out on Airbnb, like a corporate leasing model?” So they they say yes. And then from there, I use cards like 0% APR, American Express. Then that’s what I got my furniture from. Then once I got my my place all hooked up, I put it on Airbnb, and then I was making great cash flow from that.

And then starting out from the cash flow, I would I would rent my my unit, then I would go stay at my girlfriend’s house at the time, and I’ll keep doing that. Every time I rent my unit out, I’ll go to my girlfriend’s house. And then I end up getting a job, another job two months now. So I was working and doing the rental arbitrage for one unit for a good amount of time. Yeah. And then from there the… but the reason why I got into it was I seen so much potential in it, you know, seen a lot of potential in it. And yeah, and it really hit home for me because I’m a really a hospitable person, and I’m really I’m a I’m a good… I’m a chill guy. My personality, you know, aligns with it as well, so that’s what that’s what made me passionate. I wanted to see people, you know, have a good experience, you know. So…

Freddie Steen (05:14)
In a day in which we are so automated, our automation is through the roof at this point, do you find that being hospitable, that personal touch that you have, is the human in the loop that helps you gain more profit share in the rental arbitrage space?

Jonny Harvey (06:20)
I believe it is because, you know, you you always… you can catch more flies with sugar, you know what I’m saying, with honey. So, you know, so you gain more people as hospitable you are. And in the rental arbitrage Airbnb business, if you if you reach out… the faster you reach out to people, the more you get pushed in the algorithm, you know, replying to reviews, replying back to guests fast, you know. Being that kindness, you know, even though some guests could be really, you know, cookie-cutters, really particular about everything, really minuscule, right? If you still think think back in your head, think like, “Hey, this person… just just stay away from emotion,” you know, and just be, “Hey, whatever I could do to help this person out,” you know, and don’t take it too personal, and just help the person out. If you do if you do if you’re like that, then it’s a lot of gain, and you can be Superhost, you can be guest favorite, and you get pushed in the algorithm and you’ll you’ll make a lot of money in the business, so…

Freddie Steen (07:24)
I mean, the fact of the matter is, Jonny, and tell me if you agree with this: rental arbitrage still works in 2026. The gap between the markets where it works and markets where it’s destroyed capital, some writers say, has never been wider. You based in Oakland have looked at now Phoenix, Arizona, Nevada, Florida. Tell me about that process and why you’re still go, go, go, and how you do it.

Jonny Harvey (07:56)
Well, about the the process is, you know, you look at you look at some units, so you basically get a list of them, and I’ll just call the landlord. We try to go for units that have landlord-managed properties, you know. You know, we we kinda don’t wanna talk to middleman, we don’t wanna do that. Right, we wanna go straight to the horse’s mouth. So, you know what I mean? So…

Freddie Steen (08:19)
I love it.

Jonny Harvey (08:21)
That’s what we do right now. We call them up and we ask them, “Hey, can we can we do a corporate leasing model? We actually focus on travel nurses, insurance programs, and family placement, you know, if you will.” So from there, then… but we’ll we also tell them, we’re upfront about it, “Hey, we we do put it on Airbnb about twenty, thirty percent of the time,” you know, which is true, you know. So then, you know, they can say yes or they can say no, you know. You know, that’s really the most they can say. So from there, and if they say yes, that’s when we’ll do the projections. We’ll do… we have Excel sheets, even in even in my program, we we have Excel sheets to where we just we just place the numbers in each group, right, each down the line, and then we hit enter and then it just does it for you. It does the calculations for you. So we do that… I do that with every unit that I’m going to invest in. So that’s basically how we do it.

Freddie Steen (09:18)
Jonny, I love it. And that’s something that caught my attention about you was the way that you’ve been able to move in a niche space in real estate where most people that get into rental arbitrage believe it’s just about having a good cleaner and a good guest. But you did it differently. You did it in multiple markets, you’re doing it in multiple markets, and you kept your margin strong.

Jonny Harvey (09:42)
Still.

Freddie Steen (09:44)
Would you say one of the keys to that has been, because it’s not easy in this climate, the secret to your machine running smoothly, part of that secret has been you and your relationship selling?

Jonny Harvey (10:33)
I believe it is because of relationships. Relationships are the pinnacle of movement when it comes to a great business, you know. You know, your network is your net worth. And how how I moved, I invested in mentors, you know, soon. And then when I invested in mentors, then I was able to reach a certain amount of people that were in the the business, in the niche. So from there, you know, I got a lot of help from that, and I I also partnered with deal sources that helped me find deals now at this point. So yeah, it was it was definitely relationships and being being an asset to others as they are to me, so…

Freddie Steen (11:17)
That’s so key. I want our real estate pros who are just like you to go even further behind the curtain, just a 30,000-foot view, Jonny, of you being a person who’s a trailblazer in the rental arbitrage space, because you went beyond having a good cleaner, beyond having a good guest, but you also do a lot of research and due diligence on the front end. Can you talk about that mental process and what you’ve learned along the way?

Jonny Harvey (11:47)
You’re you’re asking when it comes to the the market research?

Freddie Steen (11:51)
That is correct, yes.

Jonny Harvey (11:53)
Yeah, the research. Yeah, I do a lot of research behind the scenes. Yeah, I kinda… the I think that’s the part that’s like the hardest, you know, because it’s like it’s tedious, you know, and it’s just, you know, it it’s constant. It’s a constant thing. And then some people can get frustrated when it comes to landlords saying no. And it’s it it is a little tedious, but, you know, when it when it comes to the market research… and we look we look into a market, we want to focus on one market, just one market, and we want to go down the list, you know, because we want to look at, “Hey, is it close to a attraction, national park? You know, is it close to hospitals, you know, for, you know, your travel nurses and stuff like that? Is it close to a school?” A school is is a good one, you know, a military base, you know, sports stadiums, you know, baseball, football, basketball, hockey, you know? So those are the things we look at.

And then also when we get the unit, of course we’ll do a deal projection. And that’s when it comes to the price. It’s like, “Hey, can we negotiate on the price? Is there room for that, you know, promotions? Can we get two bet… two two months rent… two months rent rent for free? Or can we get one one month rent for free?” You know, so we can get our ROI the fastest we can, you know. So that’s that’s another one we we use in the research.

Freddie Steen (13:19)
So, Jonny, we know you’re a guru in rental arbitrage because you just hit a note with our real estate pro audience. What is your strategy going into 2027 on getting longer-term rentals out of your rental arbitrage investment?

Jonny Harvey (13:37)
Well, my my… when it comes to getting a longer-term lease, are you are you talking about when it comes to real estate me investing in real estate? So yeah, I do want to invest in real estate. So my… let’s see. So so in Dallas, I’m looking at a a triplex in Dallas, right? And I would like to do house hacking. I wanna get… I wanna live in one unit and then rent the other two out, you know, in in the yeah, in the Dallas area. So I’m looking to do that, maybe close to Deep Ellum, you know, in that area. So we’re gonna we’re thinking about doing that. And we we just wanna get the right house, the right area, and also we wanna get the right number. So when it comes to that is my that is my strategy right there. And I also want to use maybe… I wanna liquidate my cards in order to do that, you know. Using other people’s money is how I like to run my business, so…

Freddie Steen (15:19)
Using other people’s money is definitely one of the strategies that has turned our nascent audience into the real estate pros that they are. Now, Jonny, every operator I know has a moment where things got real. Maybe it’s a deal that went sideways or a time that you had to pivot fast. You mind sharing one of those moments for you?

Jonny Harvey (15:41)
Yeah. Yeah, I can share that moment, Freddie. So there’s been times when when it there were issues when it comes to certain guests, right? And this is this is way earlier in the year. So a lot… my guest that came in, I I had a I had a bad guest. They came in, they ruined the the house, they they took some stuff. It took like little knickknacks here and there, and I was using Booking.com. So Airbnb has a one-million-dollar insurance on on the house, you know, for AirCover. They call it AirCover. But Booking doesn’t have that. Booking, you can reach out to Booking and they could say, “Hey, we’ll reach out to the guests and we’ll wait for the guests to pay for it, and we’ll give them we’ll give the invoice to whatever.” Then it’s up to the guests to pay for it or not, you know? So it’s it’s only up for them, it’s what whatever their proclivity is, and and whatever they want to do. So and they’ll do it or they won’t do it. If they don’t do it, then you won’t get the money, you know. So and that’s why you gotta put other insurance in play and stuff like that.

But on the topic, right? What happened? The guests came in the unit, right? Then they they they ramshacked the place, they took the knickknacks stuff, right? But even within when they were staying in the unit, I messed up when it came to connecting the the platforms, because I had VRBO, Booking.com, and Airbnb. So Booking.com… it was a Booking.com guest. Then a VRBO guest came in. I and I was traveling at the time, like I was I was like in a whole different time zone. So then I wasn’t… so basically I wasn’t available to basically say, if “Yes, you can stay here,” “No, you can’t you can’t stay here.” So the VRBO guest actually walked in on the Booking.com guest. So it was a double booking. So from there I had to act fast. And then so what happened was VRBO asked for money back because it wasn’t gonna come out of VRBO’s pay, it was gonna come out of my pay. So so that was really it was very embarrassing for me that that happened, and I made the guest the other guests really afraid and uncomfortable. So it was really a rookie move, you know, in the beginning of the year for me.

But then after that guest came… after that guest left, they they left a… they left a machete, they left they left a whole a whole bunch of like like dolls and stuff. I don’t know if the… I don’t know if they had like voodoo dolls or something, I don’t know what they had in there, but they had all type of stuff in there. And my cleaner came in there, she showed me all the pictures and stuff. And so we had to…

Freddie Steen (18:24)
Love.

Jonny Harvey (18:41)
So from there, we kind of just… we didn’t we didn’t rent the place out for like about like five… four or five days, ’cause we didn’t we didn’t know if the guest was gonna come back. We didn’t know how how dangerous the situation was. So yeah, that guest was horrible, to say the least, you know.

Freddie Steen (18:56)
The kind of stuff people don’t talk about enough. And honestly, it’s what separates the folks who just dabble from the ones who stay in it the long term, you know, like you. So let me ask you this: what are you most focused on solving or scaling next at JP Wisdom?

Jonny Harvey (19:11)
We we would like to scale and solve… we we want to scale in Dallas, Texas. We want to get a house out there, and we’re also looking at a house in Las Vegas. Three to two-bedroom… three-bedroom three-bedroom house, two two baths, two and two baths, and then we’re we’re getting a two-car garage, we have a patio, we have… yeah, we have… we’re doing some landscaping on the house. So it it’s gonna be nice, ’cause, you know, there’s always traffic going through Las Vegas, so yeah. And then Dallas, we like I said before, we wanna do the house hacking, and then the two the other two units, we wanna do the Airbnb through them as well. So yeah, we’re looking we’re looking into those markets, yeah.

Freddie Steen (19:58)
That’s big. I mean, especially when you’ve already got your foothold in that Oakland area, and also in other markets like Florida and Nevada in place. So the next move can either compound things or create chaos depending on how you play it. Okay, Jonny. I know a lot of people listening either earlier in their journey or looking to level up, and I think they benefit from hearing this. When it comes to building relationships and growing your network, what’s made the biggest difference for you?

Jonny Harvey (20:28)
Well, the biggest difference was just doing the doing research and learning from others that were in the space. I learned from so many people that are in the space. Another mentor I learned from was James from GPWM, and he helped me a lot with optimize my business, you know, using those softwares and apps to create more time for myself in the business. We use Hospitable, Hostaway, you know, property management softwares like that in order to use AI to message guests back so they know that we’re on it, and then, you know, we’re we’re at their we’re at their help at any time. So… and then from there, automation when it comes to pricing, you know, so we don’t have to do the pricing, they just look at the the the market and then see if to stay c— stay competitive. They change the price with the market. So those apps right there, they really been a game-changer for me. And then I did that… I I learned that from others. So yeah, you know, it’s really it’s really who you know at the end of the day. Like that’s why we need more community and build more community, and that’s that’s been a game-changer in my business, you know, learning from others.

Freddie Steen (21:46)
Yeah, you can’t fake that. I mean, Jonny, relationships are everything in this space. All right, before we wrap, if someone wanted to reach out, connect with you, maybe collaborate with JP Wisdom or learn more about what you’re doing, what’s the best way for them to reach you?

Jonny Harvey (22:04)
Best way they can reach me is on Instagram @JonnyTouche, J-O-N-N-Y-T-O-U-C-H-E. Also, you can go to my Skool community as well. It’s in the link on Instagram. You can click the link and there’s a subscription where there’s a seven-day free trial and you guys cancel anytime. And if it’s if it’s value for you, then you stay on it and then you you pay a monthly. So that’s that’s a another way that they could reach out to me, and then they could be on calls. We also do calls once a week to where I could help people build in the the short-term rental business, rental arbitrage. So… but yeah, we’re gonna we’re gonna be looking to do real estate soon, so yeah, really soon.

Freddie Steen (22:52)
Perfect. Well, listen, Jonny, I appreciate your time, your story, and your perspective. We need more people in this space who are doing it the right way. Thanks again for being here.

Jonny Harvey (23:03)
Thank you for having me, Freddie. Appreciate it.

Freddie Steen (23:05)
And for those of you tuning in, if you got value from this, make sure you’re subscribed. We’ve got more conversations coming with operators just like Jonny and JP Wisdom who are out there building real businesses. We’ll see you on the next episode.