How To Make Money With Airbnb: The sharing economy makes it easy these days to make money by renting your things. You may rent your automobile out through Turo, your grounds athletic facility for parties or get-togethers exploitation simply, and even a spare space or different properties through Airbnb.
Still, is turning into an associate Airbnb host well worth the trouble? Take close look at how to make money with Airbnb to find out if it is right for you or not.
What Is Airbnb?
Airbnb is an online platform that lets you host guests for stays at your home, apartment, or additional properties. The platform is community-based. Guests and hosts can review each other. Reviews are important since others can see them and determine what type of guest or host you are.
How To Make Money With Airbnb
How to make money with Airbnb, you will need at least one room you are willing to rent out. But, some hosts have taken Airbnb hosting from a side gig to a full-time business by offering several properties. Think outside the box, even if you don’t have a handful of vacation properties to rent out, you can make money with Airbnb by putting together innovative stays, such as:
- A yurt
How To Become An Airbnb Host
To Become a host on Airbnb is fairly simple. The website walks you through the process by asking you questions about the property or room you plan on hosting. The main steps you will need to follow in the setup walk-through are:
- Provide info on the rental, such as location, number of rooms, and features
- Upload photos
- Create an availability calendar
- Add house rules
- Choose prices
Local Laws About Rentals
If some of the points on the list seem overwhelming, don’t worry. Airbnb makes the process simple by offering tutorials and guides that help you make an informed decision.
Once you become an official host, you will start receiving booking requests. Before you decide on whether to accept a booking, you can review the person’s profile to see past ratings from other hosts. You can also communicate with the guest through Airbnb’s messaging platform.
How Much Can You Make As An Airbnb Host?
How much you can make depends on your location, the number of rooms or properties, and your marketing skills.
Earning over $100 per night as a host sounds profitable, but 100% used or being fully booked the whole month is rare. Earning found that nearly half of Airbnb hosts make at least $500 per month, with average monthly earnings of $924.
Pricing Your Airbnb
Before you set a nightly price for your rental, consider some of the costs of doing business as a host. They include:
Having a renters insurance policy is necessary to protect you against the costs of litigation or damage to your property.
Airbnb’s service fee is straightforward. You will pay 3% on each booking. It is not much, but it does add up.
You will be liable for taxes on the income you make if you rent for more than 14 days per year. Speak with a tax professional to maximize your writeoffs and prepare for the tax filing.
Don’t forget to account for water, electricity, internet, trash service, and gas on your rental.
Whether you hire a company or do it yourself, you will earn expenses to clean and prepare the rental before every guest’s arrival. Many hosts offset cleaning fees by charging them to guests upfront.
Soap, toilet paper, cleaning supplies, and more are part of the cost of doing business. Don’t forget to account for the expense when deciding how much to price your rental.
Who’s Eligible To Become an Airbnb Host?
You can rent out a room or even host a tent in your backyard. It seems that the more creative you are about the experience you offer your guest, the more popular your rental may be. There are limits, of course.
According to Airbnb, there are basic requirements all hosts must follow. Some of the main ones are:
- Ensure your home is properly sanitized according to the Centers for Disease Control.
- Provide essential services, such as toilet paper, soap, pillows, sheets, and towels.
- Respond to booking requests within 24 hours.
- Maintain a high rating from customers.
- Follow your local area’s laws and ordinances regarding hosting.
- No recording devices are allowed in bedrooms and bathrooms. Security cameras in other areas must be disclosed.
- Have a marked fire escape route.
Eligibility Criteria To Become An Airbnb Host?
Although Airbnb does not set too many limits on hosts, there are things you should look into before you sign up:
If you rent, your lease agreement may have a clause that forbids you from subletting or hosting your rental Some buildings or communities may limit the number of nights you can rent your location, or even which floors allow vacation rentals.
Certain neighbors may be hostile about the prospect of an Airbnb rental next door and could make your guests’ stay unpleasant. It is important to do your research first to make sure you don’t land in hot water as a host.
While hotels are the most obvious competitors to Airbnb, there are a few other websites or apps that could serve as Airbnb alternatives. Here is how they compare:
- Airbnb vs. FlipKey
- Airbnb vs. Vrbo
- Airbnb vs. Couchsurfing
Airbnb vs. FlipKey
FlipKey is Tripadvisor’s rental platform. To start, the website is not as clean and user-friendly as Airbnb’s. It only has about 830,000 rentals at this time, compared to Airbnb’s 4 million. But, many travelers live by Tripadvisor member reviews on things to do and places to stay, making it a reputable alternative to Airbnb.
Airbnb vs. Vrbo
Vrbo stands for Vacation Rentals, Founded in 1995, it is been around longer than Airbnb. Vrbo offers about 2 million properties, half of Airbnb’s 4 million. Although Vrbo has made improvements over the years to create an easier experience for hosts and guests, Airbnb’s platform is still easier to work with for booking and hosting.
Airbnb vs. Couchsurfing
The main difference between the two is that Airbnb is paid and Couchsurfing is free. You could get started by hosting a few couch surfers to get an idea of what it is like to have guests before you list on Airbnb. But, Airbnb makes it simple to get started and provides plenty of support and resources for new hosts that want to do it right.
Steps For Make Money With Airbnb
- Market Research
- Good Deal
- Construction Of New Home
- Take Airbnb Photos
- Setting Up An Airbnb
- Find Your Vendors
- Protect Yourself
- Launch Your Listing
- Maximize Revenue
- Airbnb Experience
Having Knowledge of how to make money with Airbnb is knowing how to do your homework first. The first rule of real estate is location. Vacation rentals are no exception to the rule.
This rule is even more relevant when it comes to finding a profitable Airbnb property. We always use AirDNA to get all kinds of vacation rental market insights before we start the process of buying a short-term rental property. Take out the guesswork and see how any location will rank on Airbnb by using AirDNA.
You will immediately see how profitable it is to invest in Airbnb as compared to long-term rentals. You will also want to do your homework on any local regulations or fees that your city imposes on vacation rentals.
Find a real estate agent, preferably one that is well-versed in vacation rentals. If you can find an agent that knows how to make money with Airbnb, that is even better. Your agent will walk you through the purchase of the property.
Construction Of New Home
It is time to construct your home for short-term rentals and start setting up an Airbnb. If it is not already furnished, we recommend Ashley Furniture. We also have our list of the best Airbnb appliances. Upgrade your existing home devices to smart home devices to save on utilities and impress guests. Having a great smart TV is the easiest value add you can do. If your listing is in an outdoor or adventure market, be sure to add an Airbnb hot tub and grill if possible.
Take Airbnb Photos
Once your listing is furnished and decorated, now it is time to take amazing photos. These need to make your listing stand out so that people will click on it in the Airbnb search results. Making money on Airbnb is impossible if no one clicks on your listing because the photos are bad. This is one process we recommend leaving to a professional. Airbnb does offer photography services but we have not had great results. We find local photographers at a great deal on Thumbtack.
Setting Up An Airbnb
You need to decide what platforms you want to list on. We recommend starting with Airbnb and then considering some of Airbnb’s competitors as well. If you are going to list on multiple platforms, we recommend using vacation rental management software to help you keep up. This software will make it easy for you to see all your reservations and communication with guests in one place.
Make sure you accurately convey what your listing offers by writing a stellar Airbnb listing description. Lay down your Airbnb house rules so that you are protected when you inevitably have to claim a guest’s security deposit, or worse, deal with squatters. Accuracy is key to getting great Airbnb reviews. If a guest feels like they paid too much and didn’t receive the advertised value, they will leave a bad review that you might have to get removed.
Find Your Vendors
If you are managing your Airbnb remotely, you will need to find reliable vendors. A cleaning service that knows how to deal with Airbnb is the biggest hurdle. You will also want a handyman that is available on short notice. We found our vendors by requesting quotes on Thumbtack and then building relationships with them. This was our biggest hurdle in how to make money with Airbnb.
How will you know how to price your listing? When first setting up an Airbnb, you will not have a clue. We recommend using algorithmic pricing, something that hotels have used for decades that is now available to Airbnb hosts via Wheelhouse. If you are pricing too low you will not be making money on Airbnb, you will be losing it.
How will you respond to messages from guests 24/7? This is a key step in how to make money with Airbnb? You need to automate your listing before you even launch it. Our automation workflow allows us to automate messages to guests, schedule the cleaning service and spa maintenance team automatically, and it saves us from stress.
You will want to make sure you have a commercial insurance policy that covers Airbnb. There is so much that can go wrong when hosting guests on your property. Fires and other natural disasters are not all you have to worry about. Be sure your insurance has plenty of liability coverage so you are protected in case someone gets hurt.
Make sure you understand the hosting etiquette and rules of Airbnb. One small mistake when starting could seriously slow down a new host.
Launch Your Listing
Once you have accounted for all of the above, it is time to launch your listing. Start pricing conservatively, the goal is not to make money at first, money comes after you have got a few great reviews. You should quickly see for yourself the benefits of Airbnb as compared to long-term rentals.
Once you start seeing revenue from setting up an Airbnb property, it is time to reinvest and scale your business. Focus on becoming a Superhost so you will see a boost to your overall revenue. Consider applying to the Airbnb Plus program if your listing meets its requirements.
Whether it is a guided tour of local street art, a beginner’s surfing lesson, or a backwoods hiking trip, you can start making money by hosting an Airbnb Experience.