Becoming an Airbnb landlord has always been a reliable way to make money in real estate. While the ongoing coronavirus pandemic might have ground the industry to a halt, demand for Airbnb rental property is expected to pick up where it left off and the future outlook of short term rentals looks fairly bright. If you are planning on becoming an Airbnb host, then you would surely want to familiarize yourself with some of the essential things that every Airbnb landlord needs. Keep reading as we outline what you need in order to become an Airbnb landlord.
The 5 Things You Need to Become an Airbnb Landlord
Like anything in real estate, becoming an Airbnb landlord requires having a clear understanding of what this venture entails. After all, managing an Airbnb investment differs greatly from operating a traditional rental, and investors must be aware of several variables before they can host guests. In any event, here are the 5 things you need to keep in mind when buying Airbnb property.
1- Essential amenities
The first step of becoming an Airbnb landlord is equipping your rental property with all the essential amenities that tenants need. In fact, this is the only way to stay competitive in the short term rental market. Guests are looking for a comfortable stay at a rental property and adding a wide range of amenities to your home is how you will be able to provide them with a great experience. As for the essential amenities that you need to include when owning an Airbnb, the list below should give you a good idea of what you must focus on.
- A good WiFi router
- A smart TV with access to Netflix or other streaming services
- Phone charging cables
- A washing machine
- Feminine products
- Desk or workplace
- An iron
- A coffee maker
2- Safety items
Safety is a crucial component of Airbnb property management. Landlords who neglect this step might end up exposing their guests to a host of dangers. Needless to say, this is not a situation that you want to find yourself in. In order to avoid any potential safety issues, you need to invest in certain items. Here is a brief overview of the main ones.
- A fire extinguisher
- A smoke alarm
- Carbon monoxide detectors
- First aid kit
- A non-slip bath mat
3- A professional inspection
Equipping the investment property with all the essential amenities and safety items is not all you have to do to ensure the property is in an ideal condition. In fact, you still need to do a professional inspection to make sure that everything is in order. Retaining the services of an inspector might allow you to identify a number of issues that tend to go unnoticed by an untrained eye. While it might seem like an unnecessary expense to some, it is best to air on the side of caution and hire a professional to tackle the inspection. Moreover, any Airbnb landlord who carries out a professional inspection early on can expect fewer repair costs down the line.
Related: How Much Does a Home Inspection Cost?
4- An Airbnb profit calculator
Every Airbnb landlord needs an Airbnb profit calculator. As the name implies, this is a valuable Airbnb analytics tool that helps you to determine several important metrics. While there are many options on the market today, the Mashvisor calculator is by far the best one for landlords. Here are some of the essential Airbnb data that this tool provides you with.
- Startup costs and monthly expenses: These estimates include everything from closing costs and furniture to insurance and property management fees.
- Rental income: The Mashvisor calculator can also help you estimate Airbnb income. The tool bases these estimates on the predominant Airbnb rates in the area.
- Cash flow: This is a fairly straightforward metric. After determining your expenses and rental income, the calculator will provide you with your expected cash flow.
- Occupancy rate: The Airbnb occupancy rate is another important metric that every Airbnb landlord should know about. The calculator derives this data from the neighborhood average.
- Cash on cash return: The CoC return gives you an exact estimate of how much you will earn from operating your Airbnb rental property in relation to the amount of cash that you invested.
All of Mashvisor’s Airbnb data is calculated using listing info taken directly from Airbnb and represents the performance of actual listings. Furthermore, we verify all of our data through real Airbnb hosts to ensure we bring you the most accurate analytics.
Related: How to Conduct a Thorough Airbnb Investment Analysis
5- Airbnb verification
If you want to get more bookings as a host, then you need to get an Airbnb verification. Not only will this make you look more professional, but it will also help separate you from the thousands of unverified hosts who often resort to illegal tactics such as faking reviews. Airbnb verification increases the level of trust in your profile and invariably leads to more demand for your rental property. The verification process is simple and merely requires the ID and photo of the host. It is also worth noting that Airbnb has begun enforcing its verification rules as the platform edges closer to its «100% verified by the end of 2020» goal.
Other Factors to Keep in Mind When Operating an Airbnb Rental
Before becoming an Airbnb landlord, it is important that you familiarize yourself with certain aspects of short term rentals. Here are a couple of things that you should consider before hosting on Airbnb.
- The legal framework of short term rentals: The laws that regulate Airbnb rentals vary greatly from one city to the other. This is why you need to check your local short term rental rules before committing to this venture.
- Optimal pricing: Figuring out the right pricing is crucial to generating a good return on investment. Make sure to keep your prices competitive and in line with what most of the other hosts in your area are charging. Use Mashvisor’s Airbnb profit calculator which provides rental comps to set the right price.
Related: 20 Cities with No Airbnb Legal Issues in 2020
The Bottom Line
Given the current circumstances, this might be the perfect opportunity to learn as much as possible about what being an Airbnb landlord entails. Once the market picks up, you will surely be able to apply this knowledge when you are looking to invest in Airbnb for sale.
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