For all the real estate investors out there, there will always be trends and new additions to the real estate investment world. In the past few years, Airbnb vacation rentals have become the newest addition to the real estate investment family. Many real estate investors have jumped on the bandwagon trying to make use of the lucrative opportunity to generate as much rental income as possible.
In any case, no real estate investor can make it alone without other real estate professionals. And that’s a fact! You must create a real estate investment network that’s solid enough for you to move upward with each investment property you buy. Accordingly, real estate investors who do the research and gather information about any investment move are the winners in this tough game. The same goes for Airbnb vacation rentals- you need professionals to help set you on the right path to finding, running, and maintaining your Airbnb rental property.
What Should You Focus Your Attention on When Buying Airbnb Vacation Rentals?
The Size of Airbnb Vacation Rentals
With Airbnb vacation rentals, it’s becoming more and more common for people to travel with families, friends, and relatives. You must have your Airbnb rental property ready to accommodate all types of guests. Keep in mind that the more guests you host in your Airbnb vacation rental, the more rental income you’ll receive.
In addition to that, in central areas and metropolitan locations, people are always finding trouble accommodating a family or a large group of people into a single space. So, capitalize on that by offering something in demand with your rental properties.
The Effect of City Attractions
You will experience this effect first hand once you get your Airbnb rental property up and running. Tourists are googling everything before making travel arrangements. Let’s assume you’re going to visit Chicago. The first step to take is googling the tourist attractions of Chicago in order to book an Airbnb rental. What will happen is that you’re most likely going to find an attraction and look for the closest rental property that Airbnb has to offer you.
A great tip on finding an appropriate location for Airbnb vacation rentals is to find a major attraction in your city or town and draw a circle around it. Better if it was a maximum of 2 to three miles. This circle will represent the tourist attractions that the location offers. This translates into knowing what the Average Jo that books your rental property is coming for.
Another major location twist that Airbnb real estate investors and alternative lodging managers are using is buying and renting investment properties next to major hotels or close in proximity to them. In return, they are getting a great location with great amenities. Not to mention that they benefit from the overflow of residents from hotels. Double win!
Yes, Airbnb hosting is all fine and dandy for renting out a room in your current residence. However, buying investment properties as Airbnb vacation rentals is a whole different story. Novice real estate investors often think that investing in rental properties comes with the price tag of the listing price. Very wrong misconception. There are more expenses than meets the eye with Airbnb vacation rentals. You will need property management if you’re not available to manage the property or you’ve opted for out-of-state real estate investing.
Most importantly, you must factor in cleaning services, maintenance, utilities… the list goes on and on. Just make sure to conduct an investment property analysis when going for one. This can be done through an Airbnb profitability calculator. In any case, you can find out all sorts of expenses for any potential vacation rental and calculate the Airbnb occupancy rate. These are very useful metrics for both the novice real estate investors and expert ones. Click here to make use of Mashvisor’s Airbnb profitability calculator and enjoy the 14-day free trial.
Obstacles Can Overrun You
As for the case of starting any business, starting a real estate business is not an easy task to achieve. In any case, if it was so easy, everyone would be entering the Airbnb vacation rentals market. Additionally, the obstacles that you face as a real estate investor cannot be generalized over the entire US real estate market. Each city is different, and the regulations on Airbnb investments differ with each. Let’s take Airbnb New York as an example; the city ended up voting on an Airbnb regulation to manage Airbnb listings. This will limit the number of Airbnb listings to one property for each real estate investor. You must be fully aware of the surroundings before diving head first.
Make sure to attack every obstacle before you start investing in real estate with Airbnb rentals. Study the location and find out what attracts guests the most in your local housing market.
A Small Beginning Does Not Mean a Non-profitable One
We all want to start a business but some are unwilling to make the sacrifice of nurturing it throughout its growth. Well, for Airbnb vacation rentals, it’s definitely not a bad thing to start small. Many successful real estate investors who have gone into Airbnb investing have started with renting out a room in their apartment. After doing so, they assessed and decided that out of the many types of real estate investment strategies, this was the right one for them.
Airbnb vacation rentals can be a money-making machine if the real estate investor takes the time to thoroughly plan his/her investment properly. Additionally, consider reading online forums. This will enable you to ask other Airbnb hosts of how their experiences went and the obstacles that they faced. Lastly, don’t hesitate with real estate investing, it could get you to your destination of great financial rewards.
If you have any more insights on Airbnb vacation rentals, please share them with us in the comments section.