AirBnB® can be a great way to supplement one’s income or even create a real business. However, you need to be careful about your short-term rental adventure if you really want to make it profitable. A few details can make your project either worthwhile or nightmarish. Here are the steps you need to take:
Setting the right price
You need to look through different things to see if it will be profitable when thinking about putting up your property on AirBnB®
- Scan the market: you need to know how much similar AirBnB® properties are per night in your area to define your price. A price too high could lead to low occupancy rate but a price too low could attract the wrong kind of visitor to your home.
- Understand the AirBnB® fee system: AirBnB® is taking a reservation fee of 3% of the price to the owner and 6 to 12% to the visitor.
Calculating your expenses
You also need to think about how much it will cost you to run an AirBnB® business.
- Consider local taxes: many cities have a tourist tax. This should be included in your price.
- Think about the expenses to run your AirBnB®: guests are expecting basic consumables: toilet paper, soap, shampoo, etc. These things add up quickly, even more so because people are eager to steal those. You also need to think about cleaning expenses.
- Consider getting a co-host: if you do not live near your AirBnB® rental, having someone who will be able to do check-ins and checkouts for you, can be useful.
Improving your ratings
You have set your price and calculated your expenses from running an AirBnB®. Now you need to make sure your occupancy rate is closer to 100% than to 0%. To do so, you need to appear first in suggestion. Think of smaller, added-value details:
- Have an exhaustive list of equipment available: owning a Jacuzzi or swimming pool is a great asset, but even mentioning that you provide free Wi-Fi, bathing towels or a hairdryer can be a nice perk to guests
- Prepare a booklet presenting the neighborhood and also how everything works around the place: it will save you time from answering many questions from guests and they will greatly appreciate being independent almost immediately
- Answer as quickly as possible to potential guest: the faster you answer, the more trustworthy you appear. Consider downloading the AirBnB® app
- Encourage your guests to leave a comment: having a lot of positive comments will attract many users of AirBnB®
Protecting yourself from major losses
You have now all the major keys to make money with AirBnB®. However, you should know that letting strangers into your home could lead to major losses. If you want to avoid having a bad experience with AirBnB® as these people did, follow our pieces of advice below:
- Make sure your activity is legal: does your co-owner association allow this? Can you be a Host in that part of the town
- Empty your house of all kinds of valuables: not everything is covered by the AirBnB® Host guarantees, and more often than not, limits are quite low.
- Ask for a security deposit … but understand it is not enough: asking for a deposit is a great way to deter some guests from ravaging your place. Or it was. Now a lot of guests take this as a fee to be real monsters. Moreover, justifying to AirBnB® that guests caused damage is a complicated task: you need to prove that damage happened while they were at home. You are not covered for damage or theft if a guest is not check-in!
- Have the right insurance: AirBnB® Host Guarantee is not an insurance and relying only on it can cost you a lot. Moreover, basic home insurance doesn’t apply to a home turned profit-making business. Get a quote with APRIL to make sure your business is a profitable one!