There is so much you can learn from your fellow Airbnb investment property owners about owning an Airbnb. The information that comes with the experience these investors have is invaluable.
Read the following tips and use an Airbnb profit calculator to get all the information your competition can teach you. For more, visit Mashvisor.
Owning an Airbnb: Location Is Everything
Any of your fellow real estate investment competitors will tell you that being successful while owning an Airbnb is all about the location. People use Airbnb for many reasons including the price and the amenities that beat out hotels. However, tenants choose Airbnb rentals due to their location. Location could mean beachfront property for vacationers. It could also mean property that is close to transportation and grocery stores for people traveling for more practical reasons.
Before you buy a property to turn into an Airbnb investment or you put up a room in your home, study the demographics of Airbnb renters in your city and what they are looking for. Find out what type of accommodations tenants are looking for and decide on the type of property to rent out.
If you will be opting to use Airbnb property management, you can always buy a property in another city. Look up different Airbnb property listings in the country to find the best cities for Airbnb investment in 2018. This information helps you find properties that maximize your Airbnb profit and avoid losing money.
Owning an Airbnb: You Need to Take Property Management to a New Level
As you know, Airbnb guests use Airbnb property listings only as short term rentals. This means there will likely be numerous Airbnb guests coming in and out of the rental property every month. The turnover of occupants at the location along with all the work that needs to be done to maintain the property and handle any complaints and concerns makes Airbnb property management a full-time job. If you thought an Airbnb investment was a passive income strategy, then you’ve thought wrong. You can, however, turn an Airbnb into a passive investment if you hire a professional property manager for the role.
Owning an Airbnb: Reviews Matter…a Lot!
All successful Airbnb investors will tell you that Airbnb reviews left by occupants will make or break your business. The main concern of Airbnb investors is having a relatively stable and high rental income and to avoid losing money with their business venture. The truth is, however, if you get a few bad reviews for your business, you can risk losing it all. No one wants to stay in any short term rentals with bad reputations. The extremely high competition of Airbnb properties can make any guest simply choose another location instead of yours. To keep up Airbnb rental income, you must keep up the positive Airbnb reviews and ratings.
Owning an Airbnb: How Much Should I Charge for Rent?
This is probably not a question you can ask your Airbnb competitors; however, it is a question that can easily be answered. How much you charge for rent should be based upon the expenses you need to pay along with market trends in the area. Fortunately, given the advancement in today’s technology, you no longer have to ask a person for this information. Instead, you can ask an Airbnb profit calculator. This tool will help you figure out how much you should charge for rent and what your Airbnb rental income will look like. This tool will also help you understand the Airbnb profit you will be making per month.
Owning an Airbnb: You Have a Lot of Competition
Another thing any of your competition will tell you is that there is a LOT of competition. Airbnb rentals are everywhere largely due to the ease with which any person can start making money with Airbnb. You can figure out exactly how much competition you have, as well as answer the question “How much can you make with Airbnb” by using different comparative real estate market analysis tools.
Owning an Airbnb: It’s Expensive!
Having an Airbnb investment will be a lot more expensive than having a long-term investment property. There are so many expenses you need to think of before you start thinking about making money with Airbnb. If you are paying for the property with a loan, you will have to think about the monthly payments. Airbnb also takes a 3% service charge from you anytime you have a new guest.
You should really factor that into your expenses as it will affect your profit margins. You will also be paying for all the utilities yourself along with other complimentary amenities. These amenities include things such as telephone and internet, as well as complimentary snacks. Don’t forget to add in cleaning fees, landscaping fees, repair fees, and even pool servicing fees. These are all super important to remember and factor in when making calculations about your Airbnb profit. To skip the trouble of making the calculations yourself, try using an Airbnb profit calculator.
Click here to learn about our Airbnb profit calculator.
Owning an Airbnb: Not Always Legal
Before you get excited about becoming a landlord, stop for a second and double check Airbnb regulations in your city. Many unsuccessful investors might forget about the legality of their investment. Numerous cities around the country have limitations to the way you can rent out your Airbnb investment property. To avoid losing money, check Airbnb regulations before you buy.
Owning an Airbnb: Occupancy Rate Fluctuates
Any Airbnb landlord will tell you that owning an Airbnb comes with its pitfalls. One pitfall is the fluctuation in occupancy rate and the number of bookings from month to month. For example, if your Airbnb is a beachfront property, then its bookings are usually made by vacationers. If so, you may find a dip in your occupancy rate during the colder months. Occupancy rate fluctuations will differ from one city to another and will definitely affect your rental income.
It is important that you do your research before you make any real estate investment. Owning an Airbnb will definitely not be an easy task. Make the right calculations and use the right real estate analysis tools to find the best investment property for you. To find more real estate investment tips, as well as the best real estate analysis tools, visit Mashvisor.
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