What is Airbnb mean? Airbnb is an online marketplace that connects people looking to rent out their guest ready accommodation, with people looking for a place to stay. It currently has over 150 million users, across 100,000 cities worldwide.
Is Airbnb a good investment and how can you measure its profitability? Before the pandemic, an average Airbnb occupancy would generate an income of £924 a month and between £10,000 to £12,000 a year. It's clear to see that owning an Airbnb investment property can indeed be lucrative with consistent, laborious work and dedication.
Investing in an Airbnb is a strategy whereby investors buy a property to rent out to guests, either as an entire property or as individual rooms. It's highly unlikely that investors will live in the property themselves. The income received from Airbnb investments can vary tremendously depending on where the property is located, how often you rent it out, the quality of your home, and the services for rent you provide.
How does Airbnb work for investors?
With a multitude of investment channels available, it is vital that investors choose the right one. Airbnb, founded in 2008, has rapidly grown in popularity with many property investors signing up to it in recent years. It was originally created when two designers who shared a space decided to host three travellers looking for a place to stay.
Now millions of hosts and travellers regularly use Airbnb to advertise their accommodation across various cities worldwide. Some Airbnb hosts will also share their passions and interests with travellers and locals alike, by offering experiences and days out.
Airbnb offers many investment opportunities however, it's worth doing your research before you go ahead with a new venture. You would also benefit by doing a considerable amount of research on accommodation before deciding how much you want to spend on a property and how much you should charge. An Airbnb profitable investment can be extremely lucrative as long as it's done right. Take a look at our tips on how to do this successfully below.
- Start small. One of the most important things to consider when starting a business in renting out properties, is how many you can realistically manage. If you have more than one, try advertising just one to see if it's worth using the Airbnb management system. Other things to consider are property availability, what occupancy rate you should charge and how much work you need to put into an advertisement for your Airbnb property investment. It's also worth familiarising yourself with Airbnb as a platform and learning how to navigate your way around their website. Remember, the testing phase is important if you want to make it a success.
- Run your rental property like a business. If you own a property listed on Airbnb, we recommend that you manage it like a business. What do we mean by that? Well, companies that manage an Airbnb are similar to a hotel. They are even one of their main competitors. In order to achieve five-star ratings, hotels strive to meet and exceed their customers' expectations. They do this by thinking about the needs of those who use short-term rentals. For example, an extra toothbrush in the bathroom, ground coffee beans in the coffee machine or bottles of cold water in the fridge are just a few ways to show guests that you care. It can make all the difference!
- Get creative. On Airbnb, guest ready properties that are well-furnished and photographed by professionals are high on the list. Therefore, sending in an interior designer and photographer can really set you up for success. Take a look at how our Airbnb services can help or contact us for a price.
- Subcontract. When it comes to Airbnb guest ready accommodation, make sure you utilise the right skills for the job in mind. For example, if you're not the best interior designer why not outsource the project. Time is an investor's most valuable asset and delegating to someone else can save you time and money in the long run.
Generally speaking, staying in an Airbnb is cheaper than a hotel. This is due to not having to pay as many overheads or for having a large management team in place. There are a range of options from short-term rentals to long stays. However, the service provided is very similar to a hotel. In order to achieve an average Airbnb income of £9000 per year, you will need to spend time promoting your property in the right way and through the right channels.
Is it safe to rent out a property on Airbnb?
When new Airbnb users create an account, they are required to verify their identity before they can book. Therefore, hosts can be rest assured that checks are in place to ensure that travellers are vetted appropriately.
**Please note that this blog should not be taken as formal advice. If you are unclear on any of the information mentioned above, you should always seek professional advice.**
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