I bought a $775,000 Palm Springs house to rent on Airbnb when I was 25. It's not as profitable as I thought it would be.

• Shelby Church, 28, and her twin, Monica, bought a house in Palm Springs for $775,000 in 2020.
• They rent the property on Airbnb, but the town's short-term-rental rules stunt their earnings.
• Church said it wouldn't be worth owning the property if she didn't also use it as a vacation home.

This as-told-to essay is based on a conversation with professional YouTuber Shelby Church, 28, about her decision to purchase a house in Palm Springs with her sister and list it as a short-term rental. In 2022, the rental brought in $81,861 but cost $94,967 to run, including a property management fee. The conversation has been edited for length and clarity.

I don't think that owning an Airbnb in Palm Springs is a super profitable investment. 

Of course you have the home appreciation, but before I bought this house I did see a lot about buying Airbnbs online. I really thought that it would cash flow well and be a profitable investment. But that's really not the case in cities that are as regulated as Palm Springs. 

My sister and I bought the house in 2020 for $775,000. It's a three-bedroom, two-bathroom with a really large pool and a big backyard with a mountain view. 

A lot of people think my parents paid for the house. But it is completely paid for by my sister and I from doing YouTube over all these years and saving our money. 

We renovated the whole house. The old owners had lived there for 30 years. It needed a new electrical panel. It didn't have a pool heater. We made aesthetic changes as well, renovating the kitchen and bathrooms. 

In total, we spent about $200,000. It felt like a passion project and we spent more on it than the average house flip. Because for us, it's a house that we use a lot as well.

I live in Seattle most of the time. I love to go down when it's rainy here. 

We rent it on Airbnb and have it listed on Vrbo. We also have our own website. 

To anyone that's ever looking in the Palm Springs area for a vacation rental: it's not a good market in terms of making a profit unless you plan to use it a lot yourself.

Palm Springs has tough rules, but I think they're ultimately good 

In Palm Springs, you can only do 36 rental contracts per year. That's not 36 nights, it's 36 different groups of people.

I actually think it's a good rule. Thirty six is a pretty low number, but the city of Palm Springs doesn't really want people buying houses just to Airbnb them out and never going to them. So it also encourages people that are actually going to use the house, enjoy themselves, and be a part of the Palm Springs community. 

Each neighborhood can only have 20% of the houses be short term rentals. So if someone is looking to buy a house now and turn it into an Airbnb, you have to be very careful about which neighborhood you pick. My neighborhood, for example, is already at the cap. So if I had bought this year, I wouldn't be able to make it an Airbnb.

Our first year we did not make a profit. We had a lot of maintenance expenses. We had to buy a new AC unit and our electricity bill was extremely high. So we're in the process of getting solar panels. 

Last year, we rented it for about $700 per night on average. And then this year, we lowered it a little bit because we saw demand was slower. Now our average nightly rate is $600 a night. It sleeps six people. 

But Coachella is one of those things that really makes up for it. And most vacation rental owners kind of bank on that weekend to carry them through the slump summer season.

We got $1,200 per night and between the two weekends that's $7,200 total. We pay our property manager an 18% fee. 

Palm Springs really is a city that you need a property manager in because if somebody called the city and no one was able to go, you could potentially get a strike and get a fine.