Purchasing an Airbnb investment property is not complicated at all. However, if you plan on being the owner of the best real estate investments, you need a plan! Luckily for you, we have prepared the only checklist you will ever need when planning on buying an investment property, such as an Airbnb investment property. So, are you ready to find out what steps the most successful Airbnb investors take when buying an investment property? Then simply keep on reading.
#1 Airbnb Investment Property Checklist: Study Legal Rules of Owning an Airbnb
Before buying an investment property, an Airbnb real estate investor should investigate the legal rules of owning an Airbnb in the real estate market of his/her choice. The reason is simple: in many states as well as countries, owning an Airbnb is considered an illegal activity. Consequently, owning short term rentals in such areas may cause problems for you.
Moreover, not every state in the US is perfect for establishing an Airbnb real estate business. This is due to the fact that some states charge Airbnb investors with high taxes. Thus, before buying an Airbnb rental property, make sure to research in detail the legal rules of a real estate market in question. Otherwise, owning an Airbnb rental property will bring you a huge headache. Ready to find out which cities have the least Airbnb legal issues? Make sure to read “Which Are the US Cities with the Least Airbnb Legal Issues at the Beginning of 2018?”
#2 Airbnb Investment Property Checklist: Choosing the Location for an Airbnb Real Estate Property with an Airbnb Profit Calculator
Airbnb investors should consider the location for short term rental properties very seriously. This is because if the real estate investor chooses the wrong location for an Airbnb investment property, the rental income property will not generate enough rental income to cover rental expenses. Consequently, your Airbnb investment property will be a negative cash flow investment property. It will drag your business down until you are forced into selling your real estate investment.
So what is the right way of selecting the best places to invest in real estate? Well, one of the best ways that we can suggest is to use Mashvisor’s Airbnb profit calculator, otherwise known as our rental property calculator. If you plan on sticking with short term investment properties and succeeding with them, you really need this tool! The Airbnb profit calculator is one of the must-have real estate investing tools when searching for the best places to invest in real estate as well as rental properties.
Moreover, this real estate investment tool is a great helper when it’s time to conduct investment property analysis. An Airbnb profit calculator will indicate the best investment properties according to rental income, Airbnb occupancy rate, etc. Another great thing about the Airbnb profit calculator is that it conducts comparative market analysis as well. Thanks to comparative market analysis, Airbnb investors will be able to compare the real estate investment of their choice to similar rental properties in the same area. Curious to find out more about the Airbnb profit calculator? Make sure to read “How to Use an Airbnb Profit Calculator to Make the Most Money as a Host.”
#3 Airbnb Investment Property Checklist: Take Your Marketing Plan Seriously
Finding the best places to invest in real estate is not enough simply because your Airbnb rental property will not sell itself. You need to come up with a great marketing plan in order to succeed in the real estate market.
Happy tenants leave positive reviews and unhappy tenants leave negative reviews. Easy to understand right? On one hand, the small negative comment may affect your Airbnb investment property business negatively. On the other hand, a positive comment may boost your occupancy rate. Consequently, your real estate investing business strictly depends on your tenants. So let’s reveal the secret of how to gain positive reviews from day one. The more attention you pay to small details, like the tidiness of your short term rentals or responsiveness to your tenants’ needs, the better reputation you build as a host. Yet, this is not enough. You should provide all the needed facilities so your tenants feel at home. Consequently, this will lead to positive feedback from your Airbnb guests. Interested to learn more about Airbnb reviews? Make sure to read “How to Always Get Positive Airbnb Reviews.”
Do not forget, you are not the only one in this business. The competition between short term rentals is brutal. Thus, you need to act smart in order to have a high Airbnb occupancy rate. So, if you are new to this type of real estate investing business and people are not familiar with your way of doing business, it is not advised to charge high rent for your Airbnb investment property. Why? Well, potential tenants make their decision mainly on the comments they read and the pictures they see. So if you have not built a good amount of positive comments/reviews yet, do not charge too much. Start low and with the time, increase the rent.
Another thing is the pictures of the apartment rental. Many Airbnb investors cut the costs and do not pay enough attention to the way they are taking pictures. Consequently, by hiring a professional photographer, you ensure that your investment properties will look attractive to your potential tenants.
#4 Airbnb Investment Property Checklist: Costs from Owning an Airbnb
Starting an Airbnb investment property business is not only about calculating how much rental income you can get, but also what rental expenses to expect. Consequently, if you think that the only cost you will pay is when you buy an Airbnb investment property, then you are terribly wrong. Owning an Airbnb investment property requires a well thought out financial plan. For example, if you are not planning on cleaning the rental property by yourself, you need to consider hiring a cleaning service company. Moreover, you will need to cover utility expenses as well as pay various taxes for holding an Airbnb investment property, etc. Therefore, if you want to dominate in the industry of short term rentals, you should learn everything about the costs as well as manage the expenses your Airbnb investment property may acquire.
If you’ve checked off everything on this list, you’re ready to start investing in Airbnb. To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.