Airbnb has came on the scene as a new business idea for making money in real estate investing. Just like any other form of business, you need to learn how to invest in Airbnb before beginning. Number one advice that any Airbnb host will give you is work and effort need to be applied to gain a positive cash flow. Cash flow is the amount of money a landlord can pocket after all the costs and expenses have been accounted for.
How to invest in Airbnb? There are a few simple tricks to do in order to own a successful Airbnb rental. There are many factors to consider when beginning this journey. A landlord must consider the housing market he/she is in, what kind of property management style he/she wants to implement, the investment property, and how to utilize Airbnb customer reviews to grow the brand. These are some of the big questions that need to be considered before deciding to begin the Airbnb business.
When learning how to invest in Airbnb, it’s best to start small to get a feel for the business. Maybe try to start with one room to get an idea of the work that goes into it. But if you are impatient and think you are ready to tackle the operation head on, let us at Mashvisor help you out. Here are 7 thoughts to consider when beginning.
Related: What Makes for the Best Cities for Airbnb Rental Properties?
1. Finding Your Airbnb Property
Buying an Airbnb investment property requires the same amount of meticulous research that is required to buy any other real estate property. Finding your Airbnb property requires you to do your due diligence. Step one is to know what kind of guests you are trying to cater for. Once that is established, look for an area that they will want to rent in. Younger adults will most likely want an area that is busier as opposed to a family that is going on vacation looking to escape their daily life. Find the suitable neighborhood and find the average rental income an Airbnb property in the area can generate. A quick trick is to go on the website and look at the schedule of availability for other Airbnb rentals. Another useful tip is to check out Mashvisor, which provides real estate investors with estimated Airbnb rental income for top neighborhoods in hundreds of US cities.
2. Airbnb Property Management
To own a successful Airbnb property, one has to consider his/her Airbnb management style. This is a hands on business, it requires hard work and lots of effort. Airbnb hosts have to meet up with the guests, fix problems, clean the house in between stays, etc. As a landlord, you are required to be on call for any problem that the Airbnb guest may have, and things will go wrong. So, do not go into this thinking it is going to be a passive investment.
3. Hospitality Business
When thinking of how to invest in Airbnb, think of owning an Airbnb property as work in the hospitality business. Like any good hotel, you need to have all the essentials to make your Airbnb guests experience as pleasant as possible. This is going to include appliances that are required on daily basis. Appliances to consider include a coffee maker, an iron, an ironing board, a TV, WiFi, bedding, plates, utensils, pots, and pans. These are all important to make the Airbnb guest feel at home. A good rule of thumb is to equip the house with everything that you would require in your daily life.
You are your own concierge department. Often times, guests are traveling and need directions or fun activities to do in the area. The more personal and helpful you can be with your Airbnb guests, the friendlier and more enjoyable experience they will have.
4. Airbnb Guests Reviews
Learn how to invest in Airbnb by observing the hospitality business. Customer reviews are super important for hotels to grow their brands. So, it is important to make sure your guests give you the best Airbnb reviews. A trick to generating good Airbnb reviews when beginning is to have your rent below market value in order to lure guests. Once you have had enough good guests reviews, you can begin to make your prices more competitive.
Related: Four Things to Consider Before Purchasing an Airbnb Investment Property
5. Making Money
When learning how to invest in Airbnb, the number one question is: How does Airbnb make money? Making money through owning an Airbnb property is unlike owning a rental income; high turnover is important. A good way of generating buzz around your Airbnb rental is by taking advantage of Airbnb’s complementary photography service. Airbnb will send a professional photographer to take the best pictures of the investment property to visually appeal to future guests. In order to fully complete your listing, describe all the amenities that are within proximity of your home to peak more interest.
6. Maintenance
When you learn how to invest in Airbnb, you must learn how to efficiently clean the house in between guests. Cleaning the Airbnb property is a must. Every Airbnb guest wants a nice clean bed to sleep on with fresh linens and a clean place to make the stay feel more comfortable. There are a few tricks that established Airbnb hosts could share. An Airbnb real estate investor will tell you that having extra sheets, towels, pillows, and anything else that requires dry cleaning is a good idea. It allows for a faster turnover between Airbnb guests.
Related: Where Can You Find Airbnb Properties for Sale?
7. Patience
This is a tricky business, be patient. Just because you are doing these tricks, you are not guaranteed a high Airbnb occupancy rate right away. This is a business that will experience seasons of highs and lows. Be patient as this may take a bit longer to develop, but will be worth it at the end.
Before looking for Airbnb properties on sale, every landlord needs to stop and think of how to invest in Airbnb. Every Airbnb host has different strategies that can make his/her rental property stand out. It takes a lot to learn how to invest in Airbnb, but the truth is that following these trick can make the learning process easier and the learning curve steeper. Investing in Airbnb starts with doing your research. You’re obviously starting off right by being here. Understand that this is a very hands on business, that has high effort with high reward when doing it right. When you want to know how to invest in Airbnb, the best advice that you can receive is have everything in your Airbnb rental that you want and need in your everyday life. For more advice on owning an Airbnb property, visit Mashvisor to find out the best way to do so!