Are you dreaming about starting an Airbnb business? That is great because today we will reveal the secret of how to get started in real estate with short term rentals!
The reason the majority of investors are considering starting an Airbnb business is, of course, money. Yet, if Airbnb investors make one wrong decision, making money with Airbnb investment properties may remain a dream and nothing more. Consequently, we have done our homework and are ready to present you the guide for future Airbnb investors. With this real estate investing for beginners guide, you will understand that starting an Airbnb Business is not as hard as many think. Still doubtful? Well, keep on reading as we are ready to convince you that it is actually that easy.
#1 First Step in Starting an Airbnb Business: Choosing the Right Market
The first step in starting an Airbnb Business is finding the right location for your short-term rental properties. It is crucial to understand that some locations will be a perfect fit for long term rental properties. However, it might be a terrible mistake to start your business with Airbnb investment properties there. Consequently, always strive for locations that are top tourist destination points.
In order to find the optimal market, it is crucial to conduct comparative market analysis. It is also important to note that an Airbnb investment property business is not legal in all states and cities. Consequently, it is crucial that you do your homework and select markets where it is legal and will remain legal for the foreseeable future.
Moreover, we would like to help you in finding the best location. Just check out this blog: “The Best Cities for Airbnb Investment 2018 with High Cash on Cash Return.”
So when you know what you should do, it is important that you use Airbnb rental data as this information can bring you to the best Airbnb investment property. However, what Airbnb rental data should you look for? Well, you should pay attention at such points as:
- Median property price
- Airbnb occupancy rate
- Potential Airbnb rental income
- Average ROI
#2 Second Step in Starting an Airbnb Business: Finding a Property
After conducting comparative market analysis and finding the right market for your future Airbnb rental income property, it is the right time to look into how to find investment properties. The best is to start with analysis. To be more specific, you should conduct an investment property analysis.
However, we do not advise you do it manually as this will take too much time. The best way is by using an Airbnb profit calculator. Moreover, Mashvisor’s Airbnb profit calculator is a great helper when planning on starting an Airbnb Business. This real estate investing tool will help you to feel sure that buying Airbnb property is the right decision. That’s because this tool will present you various real estate metrics such as:
- Median property price
- Airbnb occupancy rate
- Cash flow
- Cash on cash return
- Cap rate
- Potential Airbnb rental income
- Rental comps
Are you interested to learn more about finding Airbnb rental properties? Make sure to read: “8 Steps to Finding the Best Income Properties in Any Housing Market.”
#3 Third Step in Starting an Airbnb Business: Buying Airbnb Property
So let’s summarize your steps at this point:
- You have analyzed the housing market for Airbnb rental properties.
- You have found the perfect Airbnb investment property.
Now it is time for investors to understand how to invest in Airbnb. The most common way of acquiring rental properties is through applying for a mortgage. Just make sure that your credit history is in great shape as well as be ready to put 20 percent down. However, mortgage loans are not the only way of financing Airbnb investment properties. Applying for private lenders is another possibility to receive enough cash for your dream purchase.
And there are even more ways still for financing investment properties! Curious to find out how to finance your investment property, make sure to read: “Investment Property Financing: What Are the Best Options for Real Estate Investors?”
#4 Fourth Step in Starting an Airbnb Business: Prepare Your Investment Property
Buying Airbnb property and putting it online is not enough. First of all, Airbnb investors should make sure that their investment property is in great shape. Moreover, if you plan on making money with Airbnb rentals, make sure that you decorate and furnish your place nicely.
Use the right advertising tools. Further, include professionally taken photos of your property in the description. This is important due to the fact that most Airbnb guests choose with their eyes first and then read the description.
Another thing you should keep in mind is that you should always try to be available for your Airbnb guests as they may have questions to ask. In the end, if you make your guests happy, your Airbnb occupancy rate will be high, meaning that you will be making money with Airbnb investing.
#5 Fifth Step in Starting an Airbnb Business: Repeat the Process All Over Again
Why stop with only one property? If you want to become a successful Airbnb real estate investor, you should repeat all the steps again. However, this time you may choose another location from the list of “The Best Cities for Airbnb Investment 2018.”
The goal is making money in real estate, isn’t it? Consequently, make sure that you conduct both analyses (comparative market analysis and investment property analysis) with the help of an Airbnb profit calculator. Make sure that you find the right financing method. Finally, do not forget about marketing and advertising; your Airbnb investment will not promote itself! With a nicely chosen marketing strategy, your Airbnb rentals can be among the top listings.
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.
