Thinking about buying Airbnb property sooner rather than later?
Not so fast! Before you invest in Airbnb, make sure you have the best real estate investment software at your fingertips. Using real estate investment tools makes the difference between a successful investor and one who owns a money pit.
Contrary to what many aspiring investors believe, buying a property to rent on Airbnb near any vacation destination does not necessarily guarantee a profitable investment. But thanks to real estate investment software such as Mashvisor’s tools, any investor can have access to real estate data and metrics that accurately predict a property’s profitability.
The best part? Our software is fast and simple to use. In this article, we will cover three of Mashvisor’s tools that you’ll need to invest in short term rental properties, so you can quickly get started on your path to owning an Airbnb.
1. Real Estate Heatmap
The first step in buying Airbnb property is finding locations that yield a high return on investment. But where do you look? How can you identify the best markets for Airbnb?
Though you might have a particular city in mind, not all neighborhoods in a city will be equally profitable for investing. In order to determine which areas are good for Airbnb real estate investing, you must conduct neighborhood analysis.
That’s where Mashvisor’s real estate heatmap comes in. This tool allows you to visually understand which areas of a city are performing well. Likewise, you can also see which areas are underperforming in the rental market. Portions of the map colored green indicate high values, and areas covered in red represent lower values.
Our heatmap offers several metrics that will help you conduct Airbnb market research:
- Listing price
- Airbnb cash on cash return
- Airbnb rental income
- Airbnb occupancy rate
Once you have a good grasp on the neighborhoods you’d like to invest in, you can use our second tool for buying Airbnb property: the rental property finder.
See also: 50 Best Cities for Airbnb Rental Income
2. Rental Property Finder
Mashvisor’s rental property finder is the perfect tool to help you narrow down your search when buying Airbnb property. Our property finder uses machine learning algorithms and predictive analytics to present the best possible results specifically catered to your needs.
There are a number of filters investors can use to search for Airbnb investment properties using this tool, including:
- Location
- Budget
- Miles
- Rental strategy
- Number of bedrooms/bathrooms
Because the property finder is also used to search for traditional rental properties, you must remember to select “Airbnb” under the “rental strategy” filter. That way, the list will show the top Airbnb properties for sale. After finding a few matches, you’ll want to put them to the test using the Airbnb calculator.
3. Airbnb Calculator
The third tool is the Airbnb calculator. This tool uses predictive analytics to deliver future Airbnb trends based on past market trends. It will calculate several important metrics investors need to determine whether buying Airbnb property is profitable. These metrics include:
- Airbnb nightly rate
- Rental income
- Cash flow
- Airbnb occupancy rate
- Cash on cash return
- Cap rate
With these Airbnb analytics, you can estimate Airbnb income and ensure that you’ll be pulling in a monthly profit, making a solid long term investment, and getting the highest possible return on the money you invest.
It’s important to note that our Airbnb calculator also takes your financing method into specific consideration. This can help you figure out if you’ll have a positive cash flow after making mortgage payments.
You might notice that our Airbnb calculator is the same as our traditional investment property calculator, so there is no need to switch between tools. The benefit of an all-in-one tool is that you won’t have to change calculators to compare the data for traditional versus Airbnb analytics. Essentially, our calculator will automatically tell you if a long term or short term rental strategy is best for a given property.
Want to learn more about how our Airbnb calculator works? Read this: The Airbnb Profitability Calculator: The Best Friend of the Short Term Rentals Investor
In addition to calculating these values, the Airbnb calculator will provide important Airbnb data such as:
- Real estate comps
- Rental comps
- Investment payback balance
This information will inform several crucial aspects of your decision in buying Airbnb property. For instance, real estate comps allow investors to know if a property is priced fairly; you never want to buy Airbnb property for more than it’s worth.
Our Airbnb tools also provide rental comps. That way, you can compare rental rates when buying Airbnb property. You’ll also be able to confidently set a nightly rate once you’re ready to welcome guests using this Airbnb rental data.
Investment payback balance will let you know how much money you’ll make (or lose) in the next 10 years if you go ahead and purchase the Airbnb investment property. It takes into account any changes you make in the financing or expenses.
The above Airbnb analytics are critical for every investor interested in buying Airbnb property quickly and accurately. Before Airbnb tools such as our calculator, investors were stuck using Airbnb spreadsheets and making longhand calculations, which can take hours.
The Best Airbnb Investment Software in the Market
Though calculating rental income is the most exciting part of your Airbnb journey, you need to complete the entire process of finding and analyzing an Airbnb investment property. And, to recap, Mashvisor offers all three tools you need for buying Airbnb property:
- The real estate heatmap for neighborhood analysis
- The property finder for searching through property listings
- The calculator for conducting Airbnb investment analysis
In addition, we are constantly writing about real estate market predictions on our blog. Keep tuning in for the latest data on the best cities and states for buying Airbnb property today.
Ready to start buying Airbnb property? To get access to our real estate investment tools, click here to sign up for Mashvisor today and enjoy 15% off.