Airbnb Monthly Stays: Everything Investors Need to Know

The COVID-19 pandemic brought many changes to the travel industry, including increasing popularity for Airbnb monthly stays.

Short-term rentals had become the preferred means of accommodations for traveling vacationers and businesspeople. That was until COVID-19 came along. Many governments placed travel restrictions and lockdowns to manage the spread of this virus. What did this mean for Airbnb hosts?

Because people could no longer travel as they liked, there was a huge decline in demand for short-term rentals. To counter this effect and keep their businesses afloat, many Airbnb hosts and managers introduced mid and long-term stays.

In 2022, these types of stays are slowly gaining popularity with remote workers looking for a change in environment as well as domestic travelers. These stays are helping hosts increase their Airbnb occupancy rates and also have a consistent income.

In today’s article, we look at what Airbnb monthly rentals are and everything you need to know about them.

What Are Airbnb Monthly Stays? 

According to Airbnb, a short-term stay is when a guest books a short term rental for a minimum of one night up to a maximum of 28 days. As such, any stay that extends for 28 days or longer is regarded as a long-term or monthly stay. Not all rental listings on Airbnb offer long-term stays since it’s the host’s job to decide on whether to make their properties available for such arrangements.

On the guests’ side, reasons for renting short-term and long-term stays vary. Short-term rentals mainly attract guests who’re on vacation or simply looking for a quick break. They go back home once the booking is over.

On the other hand, Airbnb monthly rentals mainly attract people traveling for work (say medical professionals and remote workers) or study purposes. Many remote workers love this option since they’re looking for a change in the usual scenery.

Why Are Airbnb Monthly Rentals Becoming Popular?

Airbnb long term rentals are becoming a popular way how to invest in real estate. Why is that? We have classified the reasons into the guests and hosts categories.

For Guests

The pandemic era disrupted a lot of industries and daily lives. The traditional rentals weren’t spared either. Once international travel activities were paused, many people began looking for alternative ways to holiday. “Staycations” became more popular as guests started enjoying vacations within their own countries.

The pandemic also affected businesses and work activities. Since many people were stuck at home for longer periods, work-from-home became popular too. These remote professionals are often looking for a change of environment and tend to favor vacation rentals with a home office setup.

College students are also more likely to book Airbnb monthly stays since they get more privacy compared to private dormitories and hotels.

For Hosts

Airbnb monthly stays can offer a consistent and reliable income stream for Airbnb hosts. While short-term stays can provide a higher income, it can become a problem when the bookings drop.

Long-term bookings solve the issue of lower occupancy rates. Many long-term guests are usually looking to stay for at least one month. Others stay for longer. Airbnb monthly rentals can help hosts keep their business afloat, especially during dormant months.

Longer stays also minimizes tasks for Airbnb hosts and property managers. You won’t have to spend your time and money marketing your rental and scheduling maintenance and cleaning.

The Pros and Cons of Airbnb Monthly Stays

The following are the pros and cons of long-term bookings for Airbnb hosts:

The Pros

The pros of hosting long term Airbnb guests include:

• Income consistency – As we’ve mentioned, Airbnb monthly rentals assure you of a consistent income throughout the year, regardless of seasons and low months. This means that long-term guests can cushion you even during months when you’d have otherwise experienced a low occupancy rate.
• Fewer management tasks – When you’re hosting long-term guests, management responsibilities such as check-in and check-out, guest communication, and online marketing reduce. Once your guests have checked in, you’ll only have to communicate with them if there’s an issue and market your rental once the booking has ended.
• Different amenity needs – The short-term rental market has a lot of competition since the rental-to-guest ratio is often in favor of the guests. This means that the guests are spoilt with a huge number of rental choices. As such, hosts go out of their way to provide amenities that will attract more bookings. However, with long-term stays, guests tend to have different amenities requirements. Long-term guests will require more essential amenities, such as a dishwasher and internet, instead of a fire pit or hot tub.
• Furnishing is optional – With short-term rentals, you must fully furnish your property. This isn’t necessarily the case with an Airbnb long term rental. You can choose to furnish your investment property partially or not at all. Many tenants tend to bring their own furniture during a long-term booking. This can save you money that would have otherwise been used to furnish your rental.

The Cons

The cons of Airbnb monthly stays for hosts include:

• Less management freedom– Remember that long-term guests are usually in search of privacy and space. This takes away the management freedom from the host. In short, you can’t manage your property as you like and when it suits you. For example, you can’t go to your property and inspect without having to call first. Many secondary homeowners also have access to their investment property during weekends or when on holiday. This won’t be the case when hosting long-term guests. 
• Fewer opportunities to maximize rental profit– With short-term rentals, you can adjust your nightly rates so that you can earn more when Airbnb demand is high and also attract guests during low seasons. This allows you to maximize your Airbnb income. Airbnb monthly stays don’t allow you to do this since you charge a fixed monthly rate. While some might argue that this is good since you can earn more during a low season, the fixed-rate holds you back from earning a higher rate during peak season.
• You need to screen tenants– When hosting short-term guests, they pay up front so there’s no risk of defaulting. With long-term stays, Airbnb only collects a one-month upfront payment at the beginning of each month. Thus, you might have to perform credit status checks since guests may default. This can be time-consuming, especially when you have a number of guests interested in booking your property.

Should I Host Long-Term Guests?

As we’ve already seen, long-term bookings have their own unique advantages and disadvantages. The same applies to short-term stays. So, what should you look at if you want to include Airbnb monthly bookings in your short-term rental business?

Here are some key factors:

• Location– Location is one of the key factors that influence any real estate investment. It determines your rental’s profitability. If your Airbnb business is located in a tourist hotspot, you might want to rethink long-term stays. Tourist hotspots assure you of high traffic and demand, especially during high seasons. In this case, it might only make sense to host long-term guests during low seasons only.
• Last year’s income from short-term renting– It’s essential to look at how much revenue your short-term rental generated in the past year when considering long-term bookings. This helps you ascertain whether you’re making enough to cover overhead costs each month and meet your profit expectations from short-term renting. If you’re not making enough, then long-term bookings could be your answer to making more revenue.
• Maximum long-term renting revenue you could make– Also calculate home much revenue you could generate from long-term bookings. This estimation will help you determine whether making the switch to Airbnb monthly stays is worth it.

Airbnb rental comps are essential when calculating revenue potential for long-term renting. Look at what comparable Airbnb rentals in your neighborhood are charging and use that as the yardstick for long-term income. You can then compare this figure with the total amount of revenue you got from short-term bookings in the last year. If you need an efficient way to do this, Mashvisor can give you access to reliable and accurate Airbnb rental comps.

If you only desire to host long-term guests during the low season, then you should only compare your net revenue from the low season to how much you could make from longer stays during the low season.

To round this section up, there’s no one-size-fits-all answer to whether you should switch to long-term bookings. It depends on what your rental strategy is, whether you wish to make changes and what your business needs are.

If you’re undecided, you can run a test phase where you list your short-term rental for long-term stays and see whether you’ll arouse interest and get bookings.

Tips to Hosting Long-Term Guests

Once you’ve carried out your Airbnb analysis and you’re now sure that you should host long-term guests, you shouldn’t just dive into it blindly. Here’s a list of tips to adequately prepare you for Airbnb monthly stays.

Optimize Your Airbnb Listing

The first step to attracting long-term guests is optimizing your rental listing on Airbnb. Here’s how to optimize your Airbnb listing for monthly stays:

• Update maximum stay length – This is something you can do in a few minutes. If you deny bookings longer than 28+ days, then you’re rejecting monthly stays Airbnb. Follow these steps to find the setting; Manage Properties > Property Name > Availability > Trip length. 
• Have weekly and monthly discounts on your listing – Setting up discounts on your monthly prices will encourage guests to book with you. The discounts are displayed on the search results.
• Use a long-term cancellation policy – Have a policy that any cancellations for long-term bookings made within two days of booking and at least 28 days before check-in will be refunded in full. Cancellations made after 48 hours will be refunded but minus the service fee. If any guests cancel during their stay, they’ll have to pay for the remaining length of their booking.
• Update your listing’s title, description, and overview – Long-term guests are looking for different things compared to short-term guests. Change your title and description to reflect those things. Highlight features in your listing that long-term guests may value and use them as your selling point. For example, if you previously highlighted the busy neighborhood in a tourist area, you may want to market it as a homely escape.
• Have a rental agreement– Just like traditional rentals, long-term bookings come with their own risks. You may want to minimize the risks by asking your guests to sign a rental agreement before the stay commences. Ensure that you include this requirement in your house rules to avoid any surprises for your guests when finalizing the booking.

Ensure Your Rental Is Long-Term Friendly

Now that we’ve seen what you can do to your listing, let’s see how you can improve the property itself to attract long-term guests.

• Add necessary amenities – As we mentioned before, long-term guests prioritize different amenities compared to short-term guests. Ensure your rental has essentials, such as a fridge, dishwasher, laundry machine, and a stocked kitchen. Since you also want to attract remote workers, include a workstation and robust WiFi.
• Offer additional instructions and recommendations – Long-term guests will appreciate it if you offer a comprehensive manual with instructions on things such as garbage collection days, service providers’ schedules, and other instructions. Also, include important information such as nearby gyms, recreational activities to do in the neighborhood, and whether they are renting a sublet. This is to ensure that your long-term guests have a smoother stay.

Price Strategically

Your Airbnb prices can make or break your business. You don’t want to price too high and end up losing your target clients to more affordable competitors. On the other hand, you don’t want to set a price so low that you end up leaving some cash on the table. You want to make enough to cover your monthly bills and remain with a handsome net profit.

How do you ensure you set the right Airbnb monthly rate?

Mashvisor’s Airbnb Calculator is your answer. This tool uses the latest and most accurate Airbnb data to help you calculate your property’s value. You can also access comparable Airbnb listings in your neighborhood or city. This tool also allows you to calculate the rate of return on investment, using metrics such as cash on cash return and cap rate.

Don’t forget to factor in additional fees, such as Airbnb income tax, and maintenance and cleaning fees.

Key Takeaways

Although Airbnb monthly stays may not be as profitable as short-term bookings, they make financial sense especially during low seasons when the market is dormant. The pandemic era changed a lot of things, including increased popularity in remote work. This has presented a great opportunity for Airbnb hosts to offer long-term stays for such professionals.

Mashvisor is your software solution for all your Airbnb business needs. You can book a demo today and learn more about how your business can benefit from our tools.