Struggling with high Airbnb vacancy rates? Here’s the solution.
Many real estate investors are turning to short-term rental properties as the optimal strategy to make money in today’s investing industry. Airbnb rentals, in specific, are gaining enormous popularity as more and more people begin to realize how lucrative they can be. However, owning an Airbnb rental property is not a risk-free investment strategy. Since Airbnb depends on the nightly rate income, the biggest challenge that real estate investors face is constantly keeping the property occupied.
High Airbnb vacancy rates can stand in your way of becoming a successful real estate investor. If you’re reading this article, then you’re probably facing this challenge as we speak. Keep reading to learn about possible reasons for Airbnb vacancy rates and the best tips on how to overcome this challenge and start making more money with Airbnb rentals.
1) Location, Location, Location
We can never stress enough how important it is to buy investment properties in the right location – not only for investing in Airbnb rentals but any type of rental property as well! The most obvious reason why you might be struggling with Airbnb vacancy rates is that there’s no real demand for such properties in the first place. Make sure you’re investing in the right location for short-term rentals. If your local real estate market doesn’t have high Airbnb occupancy rates, try looking out-of-state and hire a property management company to take care of your investment property.
To help you find the best location with low Airbnb vacancy rates, Mashvisor provides you with the Heat Map Tool. By selecting the “Airbnb Occupancy Rate” option, the heat map will use visual cues to show which areas are hot/cold for this feature. In the picture below, for example, you can see which areas in Orlando have high Airbnb occupancy rates (shown in green). Mashvisor’s heat map makes it a lot easier to compare different locations to find the best one to own an investment property.
To get your hands on the best Heat Map Tool there is, sign up with Mashvisor!
2) Focus on Marketing Your Airbnb Rental
Investing in the right location alone won’t guarantee that your rental property will remain occupied. The short-term rental market is competitive, and successful Airbnb hosts distinguish themselves with marketing. So, if you’re having high Airbnb vacancy rates, go look at your property listing. Does it give a good first impression and make you want to hit that book button? Simple things any real estate investor can do to optimize his/her listing include adding appealing pictures that show the property and its amenities, writing an eye-catching description, and sharing the listing on social media platforms and other short-term listing sites.
3) Set the Right Pricing Strategy
Most people go for Airbnb rentals because they’re more affordable than hotels, so the price is a crucial factor for Airbnb guests. When pricing your rental property, try to be affordable for as many guests as possible to push up your occupancy rate and secure a steady cash flow. Keep a close eye on the market to adjust your price depending on the season and demand. For example, during peak tourist season when demand for Airbnb rental properties is high, Airbnb hosts can increase their rent. However, when you’re dealing with Airbnb vacancy rates during the off season, you can attract guests by offering discounts.
One tool that’ll help real estate investors determine the right rent price is the Airbnb profit calculator. This real estate investing tool provides you with data on the cap rate, cash on cash return, rental income, and Airbnb occupancy rate for investment properties in different locations. Thus, you can use it to get real estate comps to compare your price with that of others who are renting out on Airbnb in the same real estate market.
4) Offer Special Amenities
Airbnb guests have certain expectations of the property which they’re renting. As a host, it’s important to provide your guests with necessities like fresh and clean towels, kitchen cutlery, and other essentials they’ll need during their stay. One way to reduce high Airbnb vacancy rates is through providing a little extra. It doesn’t have to be anything huge that’ll cost you a lot, but something like shampoos and conditioners (as traveling with liquids is hard these days), good Wi-Fi, AC, heating, extra bed sheets, and breakfast if possible. These little details can drastically push up your Airbnb occupancy rate and get you positive reviews!
5) Focus on Good Airbnb Reviews
Speaking of positive reviews, real estate investors should always try and ask their guests to leave feedback. If you don’t already know this, reviews are a major factor that will influence the occupancy rate of an Airbnb rental property – they allow future guests to evaluate your listing. Thus, the more positive reviews a rental property has, the more people would want to rent it and Airbnb vacancy rates won’t be a problem anymore!
If you get a negative review, respond with understanding. Try to understand what caused this guest to leave a negative review and take some action to fix the issue. This will help you as you’re showing potential future guests that you are responsive and take their feedback seriously.
6) Be Hospitable to Your Guests
Our last tip on how to lower Airbnb vacancy rates deals with you as a host. Some negative reviews that Airbnb guests leave don’t have anything to do with the investment property – it might be the best Airbnb rental out there, is clean and affordable, but still gets a negative review about the host. Hence, you should always be a good host and leave a good impression of yourself to boost your occupancy rate. It wouldn’t cost a thing to be welcoming and accommodating to ensure your guests are having a good experience. Not only will hospitality lead to positive reviews, but guests will also recommend you to others! With Airbnb hosts getting promoted to super hosts, you should learn the tricks that will get you there as well.
The Bottom Line
Airbnb vacancy rates are daunting. While every problem has a solution in the real estate investing business, make sure not to struggle with this one by following the above tips. Mashvisor analyzes Airbnb rental properties across the US real estate market and uses data to estimate their potential rental income, occupancy rate, and return on investment. Click here to make use of our tools (like the heat map and investment property calculator) and start analyzing the best investment properties in your city and neighborhood of choice! To start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after, click here.
Are you an Airbnb host with some tips of your own? Share them with us in the comments section!