Airbnb Rentals: Making Money in Real Estate
An Airbnb host is like the caring grandmama who stuffs her grandchildren with food to show her love. Odd comparison, I know, but that is my vision of what it is like being an Airbnb host. You are the grandmama, and your Airbnb guests are your grandchildren. When owning an Airbnb property, you need to bring hospitality, love, and care into the savage real estate investing world.
Renting out on Airbnb is an obvious change in speed as you can tell. Either way, at the end of the day you will still be making that cash. Here, we give you a number of ways to maximize your Airbnb rental income, making you the best grandparent in the Airbnb investment world.
How Does Airbnb Pricing Work?
Once you create a listing on Airbnb, they suggest to you a base price that suits your Airbnb investment. Airbnb comes up with this price by mixing: property specifics + local rental market trends + your qualifications.
Property specifics describe the number of rooms and the location of your Airbnb property. Local rental market trends take into account the cost of living in your area. Most importantly, your qualifications, which analyzes how much experience you have as an Airbnb host and how high your Airbnb reviews and ratings are.
After they are weighted and calculated, they contrive the base price. The suggested base price is a good start. However, as any smart real estate investor would say, there is always room to improve.
Related: The Airbnb Profitability Calculator: The Best Friend of the Short-Term Rentals Investor
How to Maximize Your Airbnb Rental Income
Here, we show you the strategies that are bound to maximize your Airbnb rental income. On your way to riches, you are bound to find a little extra effort goes a long way. A long way into your pocket to be specific.
Optimize Airbnb listing
This all goes back to your Airbnb investment basics. Every listing should have an attention-grabbing title, detailed accurate description, house rules, and a solid Airbnb host profile. You can do the following to keep your listing at the top of its game:
- Come up with a listing title that will get the clicks
The title of a listing is the first thing potential Airbnb guests see when searching for a place. Include a call to action type of title that will make users want to view more of your property. More views mean more chance of getting booked. Getting booked means you’re increasing your Airbnb rental income.
- Set up a post that is readable
Clicking on an Airbnb listing only to see one big bulk of words is far from appealing. No one will want to read it; it will hurt them to even try. Instead, use headers, bullets, and short sentences. You can still allow guests to fully comprehend the value of your Airbnb investment property without a million words. Keep your listing organized and avoid improper grammar or spelling. A simple mistake can cut you short of bookings, taking away from your Airbnb rental income.
- Be a photographer
Pictures are not everything, but they are most definitely important. A listing that “sounds” good means nothing if it doesn’t look good. The photos should highlight the most flattering aspects of your rental property. Catch the best angles of your property. You want to show your Airbnb property viewers just how great it is.
However, don’t catfish your viewers. That is just asking for bad reviews and backlash. Instead, remain honest. Invest in the photos, as they play one of the most crucial roles in maximizing your Airbnb rental income.
- Speak poetry
You don’t want to grab the attention then bore them! Put personality into your listing. Use flowery language when describing the property you’re renting out on Airbnb. Instead of saying “nice beach view” say, “wake up your senses with the scent of ocean water and the beach view right outside your door.” Guests like nice words, use nice words. Focus on selling the experience, not the property facts.
Set a proper price
You don’t want to cheat yourself or your users out of their money. You are on the path of making money in real estate. Mashvisor is ready to provide you with analytics like cash on cash return, cap rate, return on investment, and occupancy rate of your Airbnb property. It is your job to take our investment property analysis and make it a reality.
Setting reasonable rental rates is the first step to reaching the goals we set for you. Reach your potential Airbnb rental income, as it is more than possible. Here are some ways to do that:
- Avoid Pricing Mistakes
First mistake: pricing too high too early. A new listing with not many reviews and a high price prevents you from getting important early bookings. These fast bookings allow you to build your reputation. Try considering a 20-30% lower pricing than your competition for the first 2-3 months. Once you gain some momentum, you can adjust.
Second mistake: pricing too low too long. You want to start low; like we said it is a good start to build yourself. However, keeping prices low can hinder your Airbnb rental income. Once you build reviews and “Airbnb fame” raise your prices slowly. If you have an occupancy rate of between 75-90% booked for 2-4 weeks out, you’re good. Avoid being 50% booked 8-10 weeks out.
- Use Dynamic Pricing
Get rid of the “one size fits all” pricing strategy. Instead, implement the kind of pricing that allows you to increase your Airbnb rental income by using smart technology. This way, you account for factors like seasonality, temporality, special events, neighboring competition, and travel trends.
Related: The 5 Most Profitable Airbnb Locations According to Mashvisor’s Investment Property Calculator
- Research your competition
Rental comps are out for your money, so don’t just let them take it as they please. Research the pricing of listings in the same area you are located in.
Make adjustments to pricing as needed to meet the competition and even try to beat them so long as you are not at a loss.
You obviously have more to offer than just a good price, so don’t sell yourself short. See what they offer that you do not. Getting an idea of who you are competing against gives you the advantage of coming up to par.
- Create more capacity & charge extra person fees
This is a nice little loophole to making the most of your space. The great thing about Airbnb rentals is they are what you make them. If you have a room that can fit a king airbed, you can add an additional two guests to your listing. The occupancy of your unit can jump from 1-2 to 3-4 Airbnb guests.
This option can increase both your occupancy rate and average booking rate since you are attracting travelers that come in threes or fours. You can charge anywhere between $5-10 per guest over two and see how it works for you.
Improve Your Property
This is a really fun one because you get to be creative. This is where that tender love and care comes into your Airbnb rentals. The best thing you can do for Airbnb guests is make them feel welcomed and at home. When stepping foot into your Airbnb property, you want them to get the feeling that they are a local, not a visitor. Here are some ways you can bring some TLC to your Airbnb investment strategy.
- Identify who your Airbnb guests are
Getting to know your visitors’ demographics allows you to adjust your Airbnb rental as needed. Consider your location. What are your guests coming to do? Are they here for festivals or events in your area? Business meetings? Are they a family or some backpackers? What is their age group?
Ask these questions so you can make the proper adjustments. Again, your aim is to provide such a great experience that you are left outstanding Airbnb reviews and a higher rank. You will be surprised how much guests will appreciate the small accommodations you have made for them.
- Personalize your space
The environment where your guests are living in is everything to them. Bring some pizzazz and spice to your property. Keep everything decluttered and organized. The more simple, the better. Good lighting, greenery, and aesthetic design are all characteristics that can help set the mood for your rental property. Most Airbnb guests want to feel a type of warmth and personal connection, so do what you can.
You want to provide your guests with a unique, authentic experience so experiment. Explore colors and textures, add originality, and keep it minimal. It is easy to get carried away, so don’t overdo it. Aim for a stylish, well-balanced interior.
- Woo your Airbnb Guests
Airbnb guests are who put “income” in the word Airbnb rental income. A happy guest means good Airbnb reviews and a growing customer base. Something as simple as keeping everything in the Airbnb rental well stocked and clean contributes to a great customer experience.
Some flowers, a vase of candies, or a sweet “welcome” gift can start off their stay great and keep them wanting more. Show your creativity and invent your own welcome basket. You can put some local specialties and booklets of the places you recommend.
Thrilled Airbnb guests are much more likely to leave positive reviews than guests that had a normal or basic stay. Go the extra mile to make a good impression. Even spend a night in your own rental property to get a taste of what your guests experience. Make improvements where needed.
Related: Airbnb Reviews: Top Influencers Affecting Your Occupancy Rate
We understand that you love the sound of this because it sings the sound of money. If you feel that you want to implement these ideas but would rather hire a type of Airbnb property management, feel free to do so. Investor life can get overwhelming and the journey of making money in real estate, absorbing. It all goes back to you and your preferences.
Value Your Profit per Hour
Another way to increase that Airbnb rental income of yours is by leveraging your time. There are only so many hours in your day, and the more Airbnb rentals you own, the more time and effort you’re going to put into them. Thinking of how many hours you are putting into the rentals helps you get an idea of how to better manage your time.
This way, you can batch your work. Airbnb rental income is not just income per unit. It is Airbnb rental income per hour! Time is valuable to you as you are making money in real estate. For example, buying in bulk saves you trips to the store, giving you more time to look for, oh we don’t know, more investment properties.
It takes time to update listings, communicate with guests, set prices, or organize in general. Get paid for it. It may seem like the Airbnb rental income is you getting paid for it, but it really isn’t. Unless of course, you consider adding the cost of your time to your listings. This is just a little incentive for you to remain motivated to do your tasks.
The Break Down
This blog has a sound. A sound most real estate investors like to hear. A sound most ‘rentrepreneurs’ strive every day to hear. The sound of money. It is music to the ears of the most successful real estate investors.
With that, consider getting your hands dirty when renting out on Airbnb. You gain the experience along with that fat Airbnb rental income check. Mashvisor is here and we are stronger than ever. Let us join you on your Airbnb real estate investing journey.
Need the occupancy rate? You got it. Return on investment? It’s here. Want to calculate your profit from your Airbnb rental income? Mashvisor’s Airbnb profit calculator also gives you an advantage, as we are your secret weapon to maximize your Airbnb rental income. It doesn’t hurt to try new things, so try us. The combination of our Airbnb rental income maximizers and Mashvisor’s product is bound to set you on the path to riches.