Want to be the proud owner of an Airbnb investment but don’t want to invest in the real estate market you live in? Out of state real estate investing with the Airbnb rental strategy can be profitable, if you know just how to succeed with this winning combination.
What’s Wrong with Owning an Airbnb Investment in Your Local Real Estate Market?
Before making the decision to purchase an Airbnb investment out of state, study your local real estate market. It’s possible that an Airbnb investment will do just fine, if not better in this particular real estate market than any other location in the US housing market. And because owning an Airbnb investment in your local real estate market has many benefits, it’s important to find out.
How can you know for sure? Well, answer the following real estate investing questions to find out:
What’s The Economy of the Local Real Estate Market Like?
Answering this real estate investing question requires a local market analysis. This may sound complicated but a local market analysis can be pretty simple for a real estate investor who lives in the location of interest.
Essentially, the economy of the real estate market affects your everyday life. Ask yourself if it is doing well enough that it can support the success of an Airbnb investment in general. If you lack the knowledge for a local market analysis, a quick online search will let you know about prospective population growth, job growth and most importantly the industry of tourism.
Ever See Any Tourists Around?
Owning an Airbnb investment property and being a successful short terms rental real estate investor relies heavily on tourism. Part of your local market analysis then has to include an investigation of the tourism in your real estate market. There’s no real point in renting out a house on Airbnb if your location gets no tourists or visitors.
What Kind of Airbnb Occupancy Rate Can You Expect? What About Airbnb Rental Income?
Once a real estate investor has a general idea of the tourism in a real estate market, he/she needs to find out if it, in fact, supports an Airbnb investment. It’s possible all of these tourists gravitate towards other types of short term rentals like hotels. The only way to be sure is to check the Airbnb occupancy rate and the amount of Airbnb rental income you can receive.
Enlist the help of an Airbnb profit calculator to find these values for the real estate market. Mashvisor’s Airbnb profit calculator, for example, can show you both the Airbnb occupancy rate and the Airbnb rental income for any real estate market in the US. Additionally, based on this data our Airbnb profit calculator will tell you if an Airbnb rental strategy is the best way to go in your local real estate market. To learn more about our Airbnb profit calculator (investment property calculator), click here.
Will an Airbnb Investment Bring a Good Return on Investment Here?
Finally, your local market analysis should reveal if owning an Airbnb investment will bring a good return on investment. You can figure this out with the values provided by an Airbnb profit calculator. These include the cash on cash return, cap rate, median property price and as mentioned, the Airbnb rental income and Airbnb occupancy rate.
Once you’ve answered all of these questions, you will know if out of state real estate investing is the better option for your future Airbnb investment property. If so, let’s get into how you can succeed with an out of state Airbnb investment property.
Choosing the Best Real Estate Market for an Out of State Airbnb Investment
There’s no need to repeat ourselves here. The way you performed local market analysis before? Now you need to do so on other real estate markets in order to choose the best one for out of state real estate investing.
Sound like too much work? Well, with an Airbnb profit calculator, it’s really not. A real estate investor can quickly compare real estate markets of interest based on key determinants like median property price, cash on cash return, cap rate, Airbnb rental income and Airbnb occupancy rate. If all of these return on investment metrics look good for a location, it’s likely the tourism in that particular real estate market will lead to successful Airbnb real estate investing.
Use Mashvisor’s Airbnb profit calculator! To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.
Or you can check out this post: 10 Most Profitable Airbnb Locations for Cash on Cash Return
Choosing the Best Investment Property for an Out of State Airbnb Investment
Once you find the best real estate market for owning an Airbnb investment property, it’s time to find the perfect investment property. The Airbnb rental strategy requires an investment property to be located in the right neighborhood that attracts tourists as well as having the characteristics that short term rentals need. This could be size, number of rooms, condition and age as well amenities.
Find the best Airbnb investment property with the best real estate investing tool. You know it- the Airbnb profit calculator. Just as this Airbnb real estate investing tool shows you the return on investment for real estate markets, it can do the same for investment properties.
Even better, Mashvisor’s Airbnb profit calculator uses a tool called the property finder. This real estate investing tool shows you the top performing investment properties in the real estate market of interest. This, again, is based on the Airbnb occupancy rate, Airbnb rental income, and cash on cash return.
Don’t forget to get a home inspection done and visit the Airbnb investment property for the most success with out of state real estate investing!
Find the best investment properties for Airbnb real estate investing. Click here to get started.
Of course, successful Airbnb real estate investing doesn’t end with simply owning an Airbnb investment. What about Airbnb property management?
Hiring Professional Airbnb Property Management
Owning a rental property out of state can be difficult to manage. Luckily, there are professionals out there ready and willing to take on the responsibility of Airbnb property management. Make sure you get your money’s worth with professional Airbnb property management by checking off everything on the following list:
- The professional Airbnb property management should have experience- in the real estate market of your choice and in Airbnb real estate investment management
- The fees should be reasonable compared to other professional Airbnb property management (shop around)
- They should have a good track record in Airbnb real estate investment management, one they gladly share with you
- Ultimately, the professional Airbnb property management should have the same goals as you: increase Airbnb occupancy rate and therefore, Airbnb rental income and return on investment
A real estate investor will find the most success with an out of state Airbnb investment property with professional property management. You could always manage the Airbnb real estate investment yourself using booking software, smart locks, and scheduled cleaning services. Just know that it will require traveling!
If your local real estate market isn’t great for Airbnb real estate investing, don’t worry. You can succeed with an out of state Airbnb investment. Just follow the steps to finding the best real estate markets, Airbnb investment properties, and professional Airbnb property management!