Airbnb Ride Along
Zero to Launch - 5 Day Journey To Extra Income
Taking you step by step to find and list an apartment on Airbnb
If you’re too lazy, fine. The post says there’s a number of cities where you can make a ton of money operating a rental space on Airbnb. It even provides a nice chart to compare different cities. Moving on.
Find your closest big city. Nothing nearby? Look at local listings on the Airbnb. Take the average nightly price and calculate what 30 days of revenue would look like. That should give you an estimate of revenue potential. Then compare this to one and two bedroom monthly rental rates on craigslist.
For those of you near a big city use the Airdna website and blog to research the best areas. By research, I mean see what people are making on average listing an apartment on Airbnb full time. Take a look at 5–1o listings on Airbnb and compare the space to what’s offered on craigslist. Make sure you can stand out from those listings without paying too much. (Get your inner interior designer ready)
Two bedrooms are the biggest money-makers in big cities, but hardest to qualify for. Cities like NYC demand that you make a bunch of money to rent an apartment. Your annual income has to be greater than 40 times the monthly rent i.e. $2,200 apartment listing (Completely normal for a one-bedroom in Manhattan) means $88,000 Annual Income.
Without a partner, it’s not possible to qualify on my own in NYC so I went with a one-bedroom in Queens.
Some of the best cities according to the post are:
-One bedrooms in Honolulu, Las Vegas, Chicago, and Boulder
-Two Bedrooms in New York, Boston, and Mountain View
I ended up going with a one bedroom in Astoria, NYC.
Buy the Airdna intelligence report ($50) for your market.
Make sure there’s already a decent number of people listings in the area. If there’s only 2 or 3, the averages can get screwy. Finding an area with at least 20 will give you a much better sense of how much money you can make.
Or save $50 and roll the dice hoping your estimates are accurate.
Use Craigslist to find a place
Define your ideal metrics and get your income verification docs together. Tax Returns, Pay-stubs, Bank Statements and Credit Report. I also included a write up of how I afford everything that comes up on my credit report. In my case, Mortgage, Car, Student Loans were noteworthy.
You want to be able to act as soon as you find a place that fits what you’re looking for. The longer you wait, the more likely someone else will take it. This is especially true in hot markets like NYC.
I focused on areas close to the train listed under $1750/month. That way I could talk up how fast someone could get to Manhattan without having to pay Manhattan prices. I could also talk up the distance to La Guardia Airport and how it’s the best of both worlds.
Input your metrics in craigslist, and start looking. Build a short list of possible units and send emails asking when you can come take a look. Try to go same day.
Send an application and income verification as soon as you make your decision. Again, try for same day.
If approved, congrats, sign the rental agreement and get ready for the next step. If not, keep looking.
Hopefully, you’re approved for your apartment right off the bat. Or, if you’re like me, it’s possible you may need to convince the landlord on your ability to pay.
I came across a one-bedroom listing in my ideal location listed for 1700/month. Shot an email and hopped in my car to go take a look.
The current tenant had been living there for 7 years but was now moving out of the country. The apartment looked like it was lived in for 7 years, but nonetheless was a good space for NYC. Lots of space with high ceilings, well lit, and in a great area.
I drove home took a deep breath and sent over an application.
The landlord called me the next day and said he was concerned I wouldn’t be able to support the payments. I told him I understood and I’d give him an extra month of rent up-front with my security deposit. It worked!
We met the following day and signed the rental agreement. I gave him an Official Check for $5100 and drove home wondering what I had just gotten myself into.
Furnish and gather supplies
Take a look around your current home and decide what is a must have, and what is not.
Once you have your list, all it takes one big shopping spree on amazon or trip to Costco. (I recommend Amazon for the reviews)
Buy in bulk, cheap, but rated well. You don’t want to find yourself replacing things due to lack of quality.
Luckily I was able to buy a few things from the previous tenant which cut back on what I’d need to move. I took his Mattress and Bed Frame, wooden IKEA dresser, IKEA TV console, Leather Futon, and 2 A/C units.
Here’s a list of the things I purchased new from Amazon. The Mailman hated me the week of delivery:
Bed Bug Protective Mattress Cover
Fake Duvet Cover
Bedding (3 Sets of Sheets & Pillowcases)
2 Night Stand Lamps
Travel Iron & Ironing Mat
Digital Alarm Clock
Kitchen Knife & Cutting Board
Silverware (4 people)
Plates (4 People)
2 Pots 4 Pans (Various Sizes)
Tall Garbage Can & Bags
Shower Curtain & Hooks
Small Garbage Can & Bags
Modem & Router
Surge Protectors for extra outlets
Total Cost to Furnish & Supply was 976 (Amazon) + 500 (Tenant Stuff) = $1476.00
One of the best things I did before moving in was get the apartment painted.
This its required in NYC for new tenants, so I didn’t have to pay for it. I just sent an email of the color scheme I wanted and the landlord did the rest.
Even if it costs you a few hundred dollars to get the apartment painted, do it. Use a light color that will make the unit look clean and spacious.
Build your Airbnb Profile
This is easier than in sounds and Airbnb takes you step by step.
Don’t skip anything, be as thorough as possible.
Try to list and answer all the questions somebody traveling to your area may have.
Use this to create a guidebook that you’ll send to your guests before their arrival. Include things like; directions, restaurant recommendations, WiFi password, tidbits about the unit, etc.
For pricing, I use a service called “Beyond Pricing” to update my prices. It calculates travel trends, hotel pricing and local demand to figure out the best rates. This way I don’t have to come up with the nightly price out of thin air or do my own analysis and hope for the best. I prefer the process to be as data driven as possible. The fee is 1% of bookings.
Move in day sucks. I hate moving and am thankful my move didn’t include a bed, couch, or dresser. You may not have the same luxury.
Power through and get this done.
Clean the place and arrange everything to look presentable.
Finish off the night by taking a ton of pictures with your phone at every angle imaginable.
You’ll want images that emphasize how spacious and clean it looks. People will also want to see that it includes everything someone would want during their stay i.e. TV, Wifi, Coffee Maker, Stove, Refrigerator, Dining Set, etc.
Head home, choose the best images, and upload them to your profile, and list your space as available.
Congrats! You’ve made it from zero to launch.
Quick Side Notes:
Airbnb allows you to screen your guests by messaging back and forth and reviewing his or her profile. Once you are comfortable, you “pre-approve” their inquiry. The guest then completes the booking with you.
Some people ask a ton of questions, while others book without asking any. Even if you’ve answered all the guests questions in your listing, don’t mention it. Screening guests is as easy as texting back and forth with a friend.
It’s straightforward and there’s zero learning curve.
Occupancy Fears (Went away real quick):
I moved in November 2nd and listed the space that same night. I confirmed my first booking one day later for an 8 night stay for first week of January.
In the 27 days since moving in, I had 334 views, 13 requests, 6 reservations, and 3 stays totaling $745 in revenue.
To be fair, I operated at a complete loss for November and shelled out $6500 just to get into the place. (I bought a house for less than that)
I’ll get back 3400 of the 6500 since I paid 2 months of security deposit, but it’s still a large up front cash payment.
How’s December looking?
I have 6 confirmed bookings in December totaling $3134 in revenue.
According to the data, December, January, and February will be my slowest months. I’ll still cover my rent, but won’t make any significant profits.
At the lowest end, my place currently lists for $73/night. It fluctuates to about $130/night. I lack reviews and any sort of clout on the Airbnb platform, but the price will rise as I build positive reviews. 9 months from now, the unit is projected to rent for 230–280/night.
I’m not expecting this kind of exponential rise in price. As long as I treat people right and maintain a clean space, there’s no reason not to expect the nightly rate to rise.
Those numbers compared to the market report:
Airdna puts the average revenue for one bedrooms in Astoria at $2956/month. The 90th percentile brings in $4784/month. With my units location and high level service on my part, I think I’ll fall somewhere between those two.
To reach 2956/month in revenue at the average occupancy of 73%, I need to reach an average of $134/night. To hit the 90th percentile, I’d need $217/night.
Hopefully this was a decent guide to begin operating a space on the Airbnb platform. I see it as a phenomenal opportunity for young people to get a jump start on real estate. The rate of return is far better than any traditional real estate deal.
I’m excited for what’s to come and hope to help others make the leap as well.
I left some of the finer details out, so shoot me an email if you have a questions. email@example.com