- Adam Masato bought land in Joshua Tree, California after watching a Robuilt YouTube video.
- Masato then worked with a manufactured home manufacturer to build a luxury short-term rental property.
- The property earns an average of $8,400 per month in passive income.
In August 2020, 35-year-old Adam Masato came across a video on YouTube by creator Robuilt describing how he makes money renting out tiny homes on Airbnb in Joshua Tree, California.
At the time, Masato and his wife, Diana Hernandez, had been living rent-free in a spare bedroom in his in-laws’ house for nearly a year. The millennial couple saved nearly 100% of their combined income of $150,000 a year; Masato is a manager at a healthcare IT company, while Hernandez is a therapist with his own private practice.
In addition to saving all of their earnings from their day jobs, the couple also rented out the condo they left in 2019 to pocket an additional $1,100 per month in rental income, according to records reviewed by Insider. When their expenses were low, the couple invested their money aggressively, and Robuilt’s YouTube video entered their lives just as they were looking for the next opportunity to invest in real estate.
Masato was shut out of the Los Angeles real estate market
By the time Robuilt’s video appeared on his YouTube feed, Masato was already exhausted from scrolling through overpriced Los Angeles real estate listings. The video went into every detail of how to make money from luxury Airbnb listings with $275,000 start-up costs.
From the video, he learned:
- What Makes Land in Joshua Tree a Worthwhile Investment
- How to Find Trusted Prefab Manufacturers and Property Managers
- What design features create the best experience for guests, which then drives up the price per night
- How to Get High Ratings on Airbnb
“The second I saw this video,” Masato says, “I stayed up late just looking for a pitch and was like, ‘Wow, he’s not lying. That’s affordable!’ I started doing market research and saw that these Airbnbs were Reserve. The numbers he was throwing around, it seemed doable.”
Eight weeks after the video was posted, Masato closed the escrow on his own land in Joshua Tree for $39,806, which he paid with savings.
Masato paid $300,466 for a prefab home build with luxury finishes
After the land escrow closed, the next step was to find a contractor to build a manufactured home. Masato met with many different manufacturers before choosing Houses in orbita low-cost, eco-friendly prefab manufacturer based in California.
Masato says, “I contacted just about every cool pre-housing company I could find. I really like that Orbit Homes offers upfront pricing. Everyone said, ‘It depends on an unlimited number of factors.’ [Orbit] gave me a more concrete idea of how much it was going to cost, and they were really cool people as well.”
Masato’s Airbnb listing, a 935-square-foot, two-bedroom, two-bathroom home, is fully booked through July. According to US News Travel GuidesJune, and July fall outside peak tourist seasons in the Joshua Tree High Desert, as temperatures sometimes exceed 100 degrees. Masato’s Airbnb listing success can be partly attributed to luxury finishes, like a private hot tub, and sleek design that drive up the cost per night.
They decided to obtain alternative financing to pay for the prefabricated house
Instead of a traditional mortgage, the couple opted to take out three personal loans backed by their cryptocurrency holdings and a home equity line of credit against their condo.
“Several lenders told us that it would be a difficult loan to obtain,” explains Masato. “Precisely because it is a single-width manufactured home on private land, not a mobile home park; also because it is not a primary residence.” So they took a non-traditional route.
Here’s a breakdown of the investments and loans they used to pay for their short-term rental:
Masato explains, “Bitcoin-secured loans are 0% with no monthly payments as long as they hold my bitcoin as collateral. The caveat is that I can only borrow 25% of the dollar value of my bitcoin collateral. Also , if bitcoin’s value drops below a certain amount, I’ll get a margin call and have to post more bitcoin as collateral.”
After commissions paid to their property manager, a monthly HELOC payment of $732 and monthly payments of $370 for personal loans, Masato earns an average of $8,455 per month in passive rental income.
Masato says if he could learn how to start a passive income stream from YouTube, anyone can figure it out for themselves too. “You don’t need a specific skill set or education to do this,” he says. “It’s easy to learn, but it was really hard work, and it wasn’t without stress.”
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