How to Run an Airbnb Rental Property: A Recipe for Success
Since being launched in 2008, making money with Airbnb has become very popular with real estate investors. With 7 million-plus listings in 220 countries and regions, and more than 2 million people staying in an Airbnb per night, Airbnb is the most popular platform for short-term rentals and offers a new and exciting real estate investment opportunity.
But Why Should You Consider Running an Airbnb Business?
- Starting an Airbnb business could be more profitable than traditional renting — An Airbnb rental property with good occupancy rates could be more lucrative than renting out to a long-term tenant. This is because you can charge a higher fee on a nightly basis when renting out a property on Airbnb.
- A diversified portfolio of tenants — Airbnb rentals attract a wide range of travelers from all over the world. This gives real estate investors a chance to learn from other cultures.
- Free listings — No costly fees are required to list your short-term rental on Airbnb. All you need to do is build a profile with great photographs and a detailed description.
- Freedom to set your own price — As an Airbnb host, you get to choose how much to charge your visitors per week or night. You can keep adjusting the rental rate based on demand and supply.
- Host protection — The Airbnb Host Guarantee Program protects hosts in case Airbnb guests damage the rental property.
- More flexibility — As the owner of an Airbnb rental, you can decide to block off specific dates when you wish to use the property yourself. A traditional landlord would not have this option.
Related: Real Estate Investing: Traditional vs Airbnb Investments
How to Run an Airbnb Successfully
Thinking of running an Airbnb rental property? Here is the recipe for how to run an Airbnb successfully:
1. Find the right Airbnb property to buy
Running a successful Airbnb begins with finding the right Airbnb for sale. With tools like the heatmap, Mashvisor can help you find the best places for an Airbnb investment within minutes. Using Airbnb data such as listing price, Airbnb occupancy rate, rental income, and cash on cash return, real estate investors can compare different neighborhoods in different cities to find the best place to buy an Airbnb.
Before you buy Airbnb property, be sure to look at the Airbnb laws and regulations of your desired location. Check out the local newspapers, the Chamber of Commerce website, local government websites, and other online sources. This will help you avoid violating the law and facing financial and legal penalties.
Then, using the Airbnb calculator, you can easily identify the best performing income properties in the neighborhoods of your choice. Mashvisor’s Airbnb estimator will help you figure out what kind of return on investment you can get with an investment property for sale. This will ensure you’re buying the right one and starting on the path to success.
Find a Profitable Airbnb Investment Property
Besides searching online, you could also consider working with a real estate agent that has experience with the Airbnb rental business. A good agent will help you find the best real estate deals on the market and even negotiate on your behalf.
2. Set competitive rental rates
Pricing is a very important element in how to run an Airbnb. The main reason why people prefer Airbnb rentals is because they are more affordable compared to staying in a hotel. Find out what other similar rentals (Airbnb comps) in your neighborhood are charging and set a realistic rate. Only charge higher rates if your rental property has unique features that make it stand out from the competition. Setting a reasonable rental rate will enhance your chances of attracting guests and having a high Airbnb occupancy rate.
3. Create a strong first impression
When running an Airbnb investment property, first impressions are very important. Creating a great first impression begins with your Airbnb profile. Make sure the description mentions all the unique features in your Airbnb property, as well as the attractions in the neighborhood. Don’t forget to use clear photos that show your property from all angles. This will increase the likelihood of guests choosing your rental property over another.
Before guests come to your short-term rental, make sure it is clean and tidy. You could even have flowers, a welcome note, a gift basket or any other thoughtful expression. Such thoughtful expressions will leave your guests with pleasant memories of their visit. And these small touches can help encourage positive Airbnb reviews. When guests leave a good Airbnb review, you are likely to attract even more customers.
4. Respond to Airbnb guests immediately
When travelers visit the Airbnb site and see some interesting properties, they are likely to contact several property owners simultaneously. The faster you respond, the higher your chances of getting the guests. Successful Airbnb hosts respond to booking inquiries within 8 hours or less. If potential guests don’t hear from you quickly, they will simply go somewhere else.
Related: 6 Airbnb Messaging Tips to Impress Your Guests
5. Automate check-ins
As you move through this guide on how to run an Airbnb successfully, you might start to notice that there is a lot to do. That’s why one key to Airbnb success is automation.
At times, your guests will be late in arriving due to traffic or flight delays. One of the best ways to save time is by automating check-ins and installing a lockbox or smart lock. This way, you won’t have to hang around until late to give guests their key. With a lockbox or smart lock, guests can easily check themselves into the Airbnb rental property.
6. Hire a great cleaning service
Having a clean and sanitary rental property is a very important part of learning how to run an Airbnb real estate investment. Though you could clean the house yourself and cut costs, it would be advisable to hire professional cleaning services. This not only saves time but also ensures that your property gets a thorough cleaning.
Alternative: Hire an Airbnb Property Manager
If you’re not up to running an Airbnb or if you’re wondering how to run an Airbnb remotely (and successfully), consider hiring a professional Airbnb property management expert. The roles of an Airbnb property manager include:
- Updating the Airbnb profile
- Advertising the rental property on other platforms and managing different channels
- Screening potential tenants
- Handling rental bookings
- Supervising other workers such as cleaners and security personnel
- Handling property maintenance and repairs
- Staying updated on the local Airbnb laws and regulations
Related: Airbnb Property Management: DIY or Hire a Pro?
Conclusion
Running an Airbnb is a great idea for anyone thinking of starting a real estate business. Becoming an Airbnb host can be a great source of extra income or even a full-time income for investors that are willing to put in the hard work. Just remember the recipe for success- the right property + the right price + great Airbnb property management!
Originally published at https://www.mashvisor.com on February 5, 2020.
