Making money in real estate typically requires owning the property, right?

Coming up with a large down payment, securing financing, dealing with tenants, handling maintenance and repairs.

The barriers to entry aren’t exactly low.

But what if you could skip all that and still bring in serious cash flow by renting out apartments and homes without buying them?

When Richie Matthews and his wife were looking to supplement their seasonal events business in late 2019, rental arbitrage seemed like an ideal side hustle.

Little did they know that just a few months later, that tiny side hustle would quickly scale into a business managing 60 units and generating over $2.5 million in revenue and $700k in profits. He now runs his company, iStayUSA.com.

Tune in to Episode 588 of The Side Hustle Show learn how to:

Test unfamiliar models with tiny experiments before going “all in”
Identify profitable properties to rent (and get approval from landlords)
Build scalable systems and processes
Diversify marketing channels and revenue streams

Sponsor

Factor — Get 50% off America’s #1 ready-to-eat meal delivery service w/ code sidehustle50!

Getting Started with the First Unit

Richie had heard about the concept of rental arbitrage—renting properties long-term and then subletting them on sites like Airbnb. He was skeptical, but the model seemed promising:

Low startup costs compared to other real estate side hustles
Strong cashflow potential from the rental rate spread
Ability to test with just one unit before committing further

He decided to start small by pursuing one apartment in downtown San Diego. After plenty of “no’s,” he finally convinced a building manager to give him a chance on a one-bedroom unit that had been sitting vacant.

She even agreed to four weeks of free rent upfront as a concession. In February 2020, Richie signed the corporate lease and got to work setting up that first apartment.

“It was an IKEA explosion in there,” he says of the $4,300 furniture budget, about $5-6 per square foot.

Six weeks later, he’d earned back his upfront investment through Airbnb bookings.

With proof of concept in hand, Richie added three more units in the same building over the next couple months.

Pivoting in the Face of COVID-19

Then in March 2020, COVID turned the world upside down. The events company he and his wife had spent 15 years building was decimated overnight as festivals and gatherings were banned nationwide.

At the same time, the promising side rental arbitrage business was just hitting its stride.

Facing disaster on one front and opportunity on the other, Richie and his wife made a bold decision—they would go “all in” on growing the short-term rental business as fast as possible.

Over the next 6 months, Richie negotiated leases for a total of 9 units across 3 buildings in different cities, as landlords looked to diversify their tenant base against a backdrop of possible eviction suspensions.

Occupancy and rates were down everywhere, but the cashflow spreads still worked as many travelers like healthcare workers continued moving about. For instance, they started hosting traveling nurses and teachers conducting classes via Zoom.

Evaluating Markets and Properties

As Richie evaluates potential markets and units, he has a set of criteria he analyzes:

Unit Types

Richie focuses his search on 2-bedroom apartments rather than houses or studios. Two bedrooms best accommodate different types of travelers, from families to nurses to consultants. He avoids studios because overall demand is lower.

The apartments themselves tend to be 10-15 years old —not brand new construction where he’d be paying for all the landlord’s latest upgrades and amenities, but still nice enough to furnish and sublet.

Market Selection

His market selection relies heavily on predictive data from sites like AirDNA indicating rental demand. But he also requires evidence of:

Strong business travel – Is there a major company HQ or sizable office workforce?
Mid-term rental demand – from large hospitals and/or military bases
Year-round tourism and vacation travel

Financials

His goal is a minimum 2:1 rental rate spread—if he’s paying $2,500 / month for the lease, he wants the unit generating around $5,000 / month on average. He used free tools like Mashvisor and the Pro plan on AirDNA to estimate unit performance.

He also cross-references direct comps by studying similar listings on Airbnb in the neighborhood. How are their calendars and photos? Are they getting bookings? This helps him gauge market demand.

Building a Process-Driven Business

As Richie added more and more units, he knew he couldn’t keep running everything solo. He started systematically building an operations team to take over day-to-day management.

He brought on a dedicated Operations Manager locally to handle issues and oversee teams. For remote front desk help, he hired virtual assistants in the Philippines to handle guest communication.

For cleaning and turnover services, he recruited and trained his own housekeepers rather than outsourcing to a vacation rental management company. He pays them hourly rather than per turn.

The team developed extensive systems and processes over time:

Guest screening protocols
Security monitoring with Minut sensors
Noise violation enforcement
Emergency contingency plans

Richie says that discovering the ability to build repeatable systems and processes was hugely important in being able to step back from daily operations. It’s allowed the business to scale efficiently to 60 units while improving profit margins along the way.

Diversifying Beyond Airbnb

Airbnb was Richie’s first platform for listing and renting the units, but over time he has expanded to multiple booking channels. Currently, Airbnb represents 60% of his bookings, with the rest split across:

Vrbo
Direct bookings
Mid-term rental platforms like Furnished Finder and Hello Landing

He also cultivates referral partnerships to drive additional mid-term rental business—nurses, relocation firms, military contracts, etc.

Richie sees this channel diversification as vital in an evolving regulatory environment where cities like San Diego have considered restricting short-term rentals.

He also believes niche opportunities abound for services catering specifically to short-term rental hosts looking to professionalize and scale up their own listings.

The Technology Stack

As the business has grown, Richie has incorporated various software tools and platforms to optimize different parts of the operation:

Pricing/Calendar:

PriceLabs – dynamic pricing engine to maximize occupancy

Rental Websites:

Airbnb
Vrbo
Expedia (previously)
Booking (previously)
Furnished Finder
Hello Landing
Direct booking site

Property Management:

Hospitable – channel manager + guest messaging
Guesty (previously)

Market Analysis:

AirDNA
Mashvisor (previously)

Guest Screening:

Built-in Airbnb host tools
Custom caller screening questions
Security deposits

Security Monitoring:

Minut sensors – monitor noise in apartments

Financial Snapshot

Once up and running, Richie’s target profit is $1,250 – $1,500 per month per unit after all expenses. 

So while the upfront legwork is extensive, the model can cashflow very nicely within a reasonable timeframe. With 60 units currently, Richie’s business brought in over $2.5 million in revenue last year and over $700k in profit.

Not bad for a “side hustle” that started with a single vacation rental unit!

Community Building

Additionally, Richie founded a Creative Airbnb with Richie Matthews Facebook group connecting hosts globally to discuss best practices. He spends more time mentoring others as his personal role normalizes toward an owner-operator focus.

The goal becomes perfecting systems for productivity and guest satisfaction before releasing them publicly to help fellow rental managers.

Regulations and Controversies

A major issue facing the short-term rental industry is the affordable housing crisis affecting many communities.

When landlords or tenants lease properties solely to list them on Airbnb, it reduces supply for long-term residents and drives up rents overall.

In response, cities like San Diego have considered severe restrictions around short-term rentals. This is something hosts must consider and prepare for.

Richie aims to be conscientious—he pursues listings primarily in buildings that already have high vacancy rates rather than displacing existing long-term tenants. He also signs flexibility into his leases so he can pivot if regulatory changes happen.

Proper insurance is another key – most standard renters insurance policies will not cover short-term rental activities, so hosts need special insurance. Richie uses Proper which runs about $90 per unit per month.

So while municipal regulations exist or could be coming in many markets, there are also tailwinds—some cities actually encourage short-term rentals now as a way to generate more hotel/accommodations tax revenue for local coffers.

Key Takeaways

Richie’s journey serves as an inspiration for anyone looking to turn side hustle skills into a profitable business:

Test unfamiliar models with tiny experiments before going “all in”
Stay nimble and embrace opportunities, even in uncertainty
Build scalable systems and processes early on
Diversify marketing channels and revenue streams
Focus on profitability metrics rather than solely revenue growth

The short-term rental arbitrage model clearly works and scales nicely once up and running. However, hosts must carefully consider market selection, regulatory risks, and business processes in order to succeed long-term.

With effort and persistence, one of those experiments could blossom into a thriving full-time business over time!

Episode Links

iStayUSA.com
Airbnb
AirDNA
Mashvisor
Minut
Vrbo
Furnished Finder
Hello Landing
PriceLabs
Expedia
Booking
Hospitable
Guesty
Creative Airbnb with Richie Matthews Facebook group

Looking for More Side Hustle Help?

Start Your Free $500 Challenge. My free 5-day email course shows you how to add $500 to your bottom line.
Join the free Side Hustle Nation Community. The free Facebook group is the best place to connect with other side hustlers and get your questions answered.
Download The Side Hustle Show. My free podcast shares how to make extra money with actionable weekly episodes.

Yes, with HealthyWage you really CAN get paid to lose weight. But it’s not easy.

Here’s how it works.

Have you ever tried to get healthier and lose weight, but lost motivation before reaching your goals?

Maybe you’ve gone as far as joining a gym or buying expensive exercise equipment—only for them go unused after your initial commitment.

But what if you could lose weight and make money doing it? Would that be enough motivation to stick with your exercise and diet regimen?

With HealthyWage, you can do just that. HealthyWage is an online company that uses cash prizes (up to $10,000) to make weight loss and fitness more fun and effective.

How Does HealthyWage Work?

HealthyWage is easy to use, and follows a 7-step process:

Calculate Your Prize
Set Your Weight Loss Goal and Timeline
Make Your Bet
Verify Your Starting Weight
Lose the Weight (that’s the hard part!)
Verify Your Results
Win Money (woohoo!)

Use the Prize Calculator

Start with HealthyWage’s free Prize Calculator to pick your weight loss goal and see how much you can win.

Important Note: Your minimum weight loss goal must be at least 10% of your body weight. For example, a 200 pound person would have to lose at least 20 pounds.

Your goal will include how many pounds you want to lose as well as the time frame (in months) in which you will lose them.

You also will set an amount that you want to bet per month. As you adjust the variables, you’ll notice the prize range goes up and down based on your input.

There’s no commitment yet, so play around with the calculator until you’re comfortable with the weight loss goal and prize range.

Pro Tip: Enter a dollar amount that hurts a little (or a lot). If you put an amount that’s meaningless to you, you’ll be more likely to throw in the towel when the going gets tough.

Enter Your Stats

Next, you’ll be taken through several screens where you’ll enter specific data about yourself, including:

Gender
Height
Current Weight (which will be verified later — no padding the scale!)
Waist Size

See Your Prize Amount

In order to see your prize amount, which is based on the date you entered, you’ll need to enter an email address and create a password.

To test this out, I entered a weight loss goal of 30 pounds in 9 months with a $50 bet monthly. My prize amount ended up being $500, or an 11% return on my “investment”.

HealthyWage uses “a proprietary algorithm” to calculate prizes so prizes might be different for 2 people entering similar information. I played around with different factors but it always presented a similar prize for me.

Just to be clear on how they’re calculating this, I’m putting in $450 ($50 x 9 months), and getting out $500 when I hit my goal — the $50 gain.

To me, that seems like a lot of cash to put at risk for just a $50 gain, but your numbers might look different and there’s the motivation factor of not losing it too.

(The average prize for goal achievers is $1,331.)

Your prize winnings amount is set during this initial setup of your individual challenge, up to $10,000.

The next step is to make your bet, lose the weight, and get paid.

Making Your HealthyWage Bet

Once you’ve received your prize amount, you decide whether you want to place a bet. If you do, you will enter your credit card information.

You can choose to pay all at once or make monthly payments.

Verifying Your Weight

This is one point I was really curious about. What’s to stop people from entering an inflated “starting weight” and cashing in when the pounds miraculously melt away?

The way HealthyWage combats this is by requiring users to verify your initial weight before the challenge starts. (You’ll also do this at the end of the challenge to see if you hit your goal.)

There are two ways to do this:

Download the HealthyWage mobile app (iOS | Android) and have one on their “referees” remotely witness your weigh-in.
Make a short weigh-in video and upload it securely to the HealthyWage website.

The only equipment you need to use HealthyWage is a smartphone and a scale. There are no other “official” weigh-ins during the process, but you can use the app to track your progress.

Finish your Challenge

Your HealthyWage challenge concludes on the appointed date given. To win the prize, you just need to achieve your weight loss goal in the timeframe you set up.

As mentioned earlier, your weight will be verified at the conclusion of the challenge. If you hit your goal, you’ll earn the prize.

If not, you lose the money you wagered on yourself.

The Science Behind HealthyWage

Academic research at Harvard, Carnegie Mellon, and the University of Pennsylvania found that:

Cash rewards can increase the effectiveness of weight loss programs.
People are more likely to take action when their own money is at risk.

HealthyWage relies on two scientific rules about human behavior: incentives and loss aversion. In simpler terms, the company uses both a “carrot” and a “stick” to motivate participants.

Participants have “skin in the game” by having to wager real money on their weight loss success.

(Though tons of people sign up for gym memberships that they never use so in a sense they are losing money as well.)

There’s something about wagering money, though, that motivates people differently.

In fact, a study published in the Journal of the American Medical Association found that people who have a financial incentive to lose weight are five times more likely to reach their weight loss goals than people with no money at stake.

And it seems to be working — last year HealthyWage participants combined to drop over 850,000 pounds!

Those are great results in combatting the obesity epidemic.

How Do I Get Paid by HealthyWage?

Upon winning a challenge, you will earn HW points, valued at one dollar each. HW points will be added to your account by the evening of your prize announcement.

With your HW points, you can do a few things:

Request a payout. (yes!!)
Use HW Points to join a new challenge.
Use HW Points to pay installments on a current challenge (this requires emailing HealthyWage’s accounting department to set up).

HealthyWage pays challenge winners by paper check or PayPal.

According to their website, there is a processing fee for a paper check of $7.00. HealthyWage does not apply a fee for PayPal payouts, but standard PayPal fees of 2.9% + $0.30 may apply.

Employer Programs

HealthyWage offers programs for companies and organizations looking to implement employee wellness programs.

This can potentially help businesses decrease healthcare costs and reduce the number of sick days.

4 Other Ways to Make Money with HealthyWage: Challenges and Referrals

Besides their HealthyWager Individual Weight Loss Bet, HealthyWage offers people other ways to make money. This is done through various individual and team challenges.

You can participate in up to 10 challenges at the same time — a chance to potentially double or triple dip your earning power for the same weight loss.

1. Jackpot Challenges

Available as an individual or team challenge, with Jackpot challenges your money goes into a pot. If you (or your team with the team challenge) loses 6% of your body weight at the end of the challenge, you win the pot.

2. Step Challenge

Connect your step counting device to participate in a step challenge. You can compete as an Individual or as part of a team to try to achieve specific step goals to earn a share of the pot.

3. $10,000 Team Challenge

Teams of 5 compete to lose the greatest percentage of weight to win cash prizes. The top prize is $10,000.

4. Refer Your Friends

It’s easier to make lifestyle changes if your friends are on the same journey. For every friend you refer to make their own HealthyWager, you’ll each earn a $40 prize boost.

That means if you can find 5 friends to join you, you could add $200 to your winnings.

Is HealthyWage Legit?

HealthyWage is legit. They’ve been around since 2009 and have paid out over $52 million to tens of thousands of winners. Participants have lost a collective 10 million pounds!

Still, some people have question whether HealthyWage is an ethical company or a scam. They’re turned off by the fact that it resembles gambling.

On the surface, HealthyWage seems to profit off the fact that the majority of people simply don’t stick with diets or fitness plans.

Co-founder David Roddenberry says that HealthyWage “success rates vary, with between 25% and 40% of participants actually winning their bets.”

“If 100% of the people lost the weight,” he added, “We would be absolutely thrilled.” (Though I’m sure that would hurt the cash flow of the company!)

HealthyWage also makes money from sponsorships, corporate partnerships, and various fees—not just from users who fail to hit their health goals.

Although HealthyWage’s model seems like a gamble, participants have control of the outcome. They decide if they will put in the work and stick with their health plan.

The program is set up to offer higher prize payouts to people with large amounts of weight to lose, which can be hard to accomplish.

HealthyWage Success Stories

My favorite section of the HealthyWage site is their success stories section. That’s where you’ll find actual participants who made the necessary lifestyle changes to lose the weight—and win their bet.

The before-and-after pictures are striking (and motivating)!

For example, Matt in Massachusetts lost 44 pounds in 6 months and won $1050:

Tina in Florida took home $1073 after dropping 40 pounds in 15 months:

In Texas, Lashea lost 57 pounds in 7 months, which earned her $2307:

Michele in Nevada dropped 53 pounds over 9 months and took home $2100 in prize money.

You can check out these and other success stories here, or punch in your goal to see how much your prize would be.

In 2020, more than 45,000 people bet on their weight loss and won. Even celebrities like Sherri Shepherd are getting in on the action, winning $1,300 for hitting her weight loss goal.

HealthyWage Alternatives

HealthyWage isn’t the only weight loss betting website that can earn people money. Following the success of HealthyWage, other sites have popped up that offer similar programs.

Some of those websites include:

DietBet — Similar to HealthyWage. Earn money by betting on yourself to hit your weight loss goal.

RunBet — RunBet hosts games to keep you committed to running. Place your bet, start running, and win. You can run outdoors, on a track or on a treadmill. You just need to sync your program with an approved GPS app.

CashWalk — Tracking and claiming your steps in CashWalk is worth around $5 a month in free gift cards. See our full CashWalk review for more. Get 100 bonus coins w/ referral code MR9W5.

Miles — The new Miles app gives you “frequent flyer miles” for all the travel you do, whether walking, biking, driving, riding, or flying. Don’t expect it to be a huge money-maker though — it takes 1,000-2,000 miles to earn a $1 Amazon gift card.

Evidation — Evidation pays you for keeping healthy habits. Connect various fitness and health apps and start earning money for tracking steps, sleep, meals, and more.

Who is the Ideal HealthyWage Participant?

HealthyWage is a great program for men or women who have a hard time losing weight on their own and need extra motivation.

Or, if you’re committed to making some lifestyle changes anyway, you might as well get paid!

Although HealthyWage can be used by anyone, people who have more weight to lose can make more money. The team challenges encourage a sense of community between participants as they try to reach goals together.

How to Succeed with HealthyWage

Because you’re betting on your ability to lose weight, it’s important to set yourself up for success with the right habits.

Those habits include eating healthy, portion control, and consistent exercise. What else can you do to make sure you meet your weight loss goals and win your wagers?

Have a Plan

To accomplish your goals, it makes sense to spend time formulating a plan for success.

What fitness routines will help lose weight most effectively? What changes do you need to make to your diet? How will you hold yourself accountable?

Use Fitness Tracking Apps

Use an app like My Fitness Pal or Noom to track your fitness goals and what you eat.

This allows you to keep track of your progress and adjust your plan throughout the process. I know I eat better when I’m consistently logging my meals and snacks in My Fitness Pal.

Find Accountability

You’ve already got money on the line, which is definitely one form of accountability!

But whether you join a HealthyWage team or have a spouse or friend help, find someone who can apply some positive peer pressure. This will help keep you accountable to your weight loss goals.

HealthyWage even has a built-in accountability feature called “Lifelines,” where you can enlist trusted friends or family members to support your journey. It’s free to be a Lifeline and they’ll be able to see your weight loss progress, your meal plan, and any mid-challenge photos you post.

Plus, if you refer friends to make their own HealthyWager, you’ll each earn a $40 prize boost.

Is Ozempic Allowed?

Yes. If you’re on a prescription weight-loss medication, you can still participate. This includes GLP-1 medications such as Wegovy, Ozempic, Mounjaro, etc.

(Surgical weight loss procedures like gastric bypass aren’t allowed.)

Is HealthyWage Right for You?

You can make decent money through HealthyWage, depending on your weight loss goals.

This won’t replace your day job salary, but if you’re already considering starting a new diet plan, it could be an added bonus.

If you thrive off extra motivation and have the self-discipline to stick with a fitness program, HealthyWage could earn you extra cash.

Your Turn

Have you tried HealthyWage yet? Did you win your bet?

Serious About Making Extra Money?

Start Your Free $500 Challenge. My free 5-day email course shows you how to add $500 to your bottom line.
Join the free Side Hustle Nation Community. The free Facebook group is the best place to connect with other side hustlers and get your questions answered.
Download The Side Hustle Show. My free podcast shares how to make extra money with actionable weekly episodes.

Frequently Asked Questions

Is HealthyWage legal?

While HealthyWage calls their program a “bet”, it’s not really gambling since you technically have control over the outcome. Because of that, the site avoids gambling restrictions and remains legal.

Is HealthyWage legit?

Yes, HealthyWage is a legitimate way to earn money losing weight. How much you can earn will depend on how much you have to lose and your timeline for dropping those pounds. Check out our full HealthyWage review to learn how it works.

Does HealthyWage really pay?

After you verify your weight loss, you can choose to cash out your prize via paper check or PayPal. There is a $7 processing fee to get a paper check issued, but PayPal payouts are free (though PayPal may charge a fee). Check out our full HealthyWage review to learn how it works.

Pin it for later: