In the real estate business we have come across a good amount of people who now live off of their AirBnb income. We have seen a very common trend on what has worked best for people. Yes, you can Airbnb any home or apartment, but we will be discussing people who have made a business out of it so they can live without a 9 to 5 job.
How To Start a Profitable AirBnb Business
Be Creative - Making the place especially unique can make or break success. But This can be done in so many different ways, from the outside of the home to the inside. If you have used Airbnb yourself, As you look at AirBnb listings, there are always places with that unique look. It just makes you click on the listing, it could be artistic, comfortable looking or some amazing tree house for example.
Some of the most successful listings on AirBnb or sites like it are very unique. You don't need to buy a mansion to have an attractive place. People have done beautiful tree homes, shipping container mods, airstreams or multi units, which we will go into later. But even with these unique exteriors, your interior design should be clean, comfortable and enjoyable to stay at. If architecture and interior design are not your best asset, seriously look into outsourcing this. It could make or break your intentions of making a business out of AirBnb.
Location - This is about as obvious as it gets when it comes to this subject. If you are in a place tourists and visitors do not frequent, you will be better off renting long term. But if you are in a spot people want to travel to, your location should be close as possible to that area. And if your a bit outside the main attractions, get creative. Have free electric scooters or a golf cart for the guest. Also a contact sheet for taxis, shuttles and bus routes.
It goes without saying, location is very important. AirBnb updates their top rented locations year after year. But remember, people travel all over, not just to a few places. If you have zero clue where, but just want to get started in making income. Consider different countries based on where you can afford and the locations within that country. Be sure to know the country, state or local laws as some places ban AirBnb. Also be aware some countries may tax AirBnb income differently, for example Costa Rica keeps an eye on this and has high tax rates for it.
Multi Unit - Most of the people I have come across making a living from Airbnb had a multi unit place. Basically running a hotel in a a way, but with a home like feel to the places. One example is a family who built four separate units near their own home, with a bit of distance between. They put in a nice pool, outdoor dining area, private patios and of course, great design, both inside and out. Also added some nice amenities which we will go over next.
Let's do some basic math with a multi unit place. Four units, something easy for a hired hand or family to manage themselves.
Example 1 - Medium to low rental price of $50 a night. Full occupancy, small units, basic kitchen using four separate units.
$50 a night x 4 units = $200 a night
$200 a night x 7 nights a week = $1,400 a week
$1,400 a week x 4 weeks = $5,600 a month gross.
Example 2 - Medium to High range of $100 a night. Full occupancy, nice designed units, higher rate area and using four units.
$100 a night x 4 units = $400 a night
$400 x 7 nights a week = $2,800 a week
$2,800 x 4 weeks = $11,200
Example 1 = $67,200 Annual Gross
Example 2 = $134,400 Annual Gross
DISCLAIMER!!! You will not be rented out 365 days a year with four units unless you are on some destination like Hawaii, but even then, probably not. But still, it gives you an idea and from there you can figure out what you may be looking at income wise. You would want to study the local AirBnb near you, rates and popularity vs. cost of building or buying to do this.
Using Multiple listing platforms - You don't have to limit yourself to just AirBnb. You can get way more exposure using as many websites as possible. But you must also treat it like a business, don't let someone book the same place on Airbnb and trip advisor for example. These companies will give you a penalty for canceling a reservation on someone. Here are some of the most commonly used platforms, you can list on all of them for great exposure.
- One fine stay
- Luxury Retreats
The list is quite long right? Well, there is even more, you can also get creative and on other platforms like Expedia and Hotels.com with some of the right licenses or requirements. Some people have even made their place its own website. This way they can market it on Instagram, Google ads and more. So you can see, the more you put into this, you can almost run a makeshift hotel.
Adding Amenities - A lot of places sell themselves short by not offering unique stuff along with their listing or in a stay. But the ones who do, have seen the benefits of what it can bring. Here are a few ideas, and no, they don't have to be free. This is where you can make even more money. Think like a hotel, sometimes breakfast is free but not much else.
Food Options - While not everyone can provide this, If you are running a multi unit this should be something to think about. It can be very basic, like a small continental breakfast and fresh coffee in the outdoor dining area between 6am to 8am. Also, an advanced request for dining is another thing. For example, a family of four would tell the AirBnb, we would like to try dinner in the dining area tonight. You can make this a "must be requested a day in advance" or something. Then charge $20 or so per person and make it a great experience. If it's worth your time and you enjoy it, you just made an extra $80.00 on a family of four that night. Be creative, these are just examples, you don't have to start a restaurant. Most people will want to explore their new area and restaurants. But it's a nice addition to offer.
Tours - A lot of people doing AirBnb in places like Costa Rica for example, surprise me by not catching on to this. Certain tourists destinations thrive on taking people to waterfalls, parks, zoos, hiking and stuff like this. As someone running an AirBnb all you have to do is offer it, not run it. Talking with a tour company, they 99% of the time will cut you a share of what the tour costs. This is just how they grow their business as well. So you would pick someone you trust, have a good deal with them and know their are entertaining your clients. You can offer it to your guests in a folder on their coffee table. If they chose to go, you arrange it and then get paid by the tour company. This is quite common for hotels to do, so don't sell yourself short if you want to add to your income.
Basic Needs - Things like fresh towels, toilet paper and other really basic things mean a lot to guests. I've stayed at an AirBnb before that gave me one towel for two weeks, they had a pool and it was raining every day. So it goes without saying, it started to smell like mold. But they never offered to provide another one or clean it. You don't have to be working 24/7 just to offer a few clean towels every other day. Also, daily cleaning is uncommon with AirBnb stays, but if someone is staying a month. Cleaning once a week with fresh sheets and bleaching the bathroom goes a long way to make someone feel comfortable. These are just the basics, but things like laundry use, fresh homemade soap and conditioners, things like that can give you a higher rating. Charge for what you need to though, just outline things ahead of time so it's not a surprise.
- Entertainment - Putting in some extra items to make the guests stay enjoyable is a great way to boost reviews. Say your Airbnb is near the beach, you could put fishing poles, surf boards, boogie boards or skim boards. Just little things that are options for them and can make the trip more memorable. Board games, Jenga, cards or monopoly for example are a good addition as well. With so many games out there, get creative, it can even be horseshoes and not necessarily in house games. Transportation like a golf cart, scooter or something like this can be a huge plus. But be absolutely sure you don't put yourself at any liability risk with these.
- Reviews - Don't mess around with not focusing on this, everyone is booking from the Internet and they don't want to be in a scary situation while on vacation. This is one reason hotels are still the number one go to, because you know it should be quite safe. But the same can be said for an AirBnb if it has 80+ reviews and most are 4 and 5 stars. Plus people talk about how great the hosts were, the house and the guests. Then just about every traveler is going to feel just fine heading there. With Airbnb at least, people look for ratings, super hosts and things like that. When you have a place, no ratings at all and the pictures are poor lighting. You just won't gain traction, no one wants to be the first to find out if this place is even safe enough. You at least have to engage, market your property, answer people fast and tend to their needs. But getting reviews is so important, do everything you can and do it on all platforms. If you have zero reviews, consider have a friend stay to get your reviews going.
Time for Expansion - So, you did one, it's working and you are making good money, it's popular and things are good. Well, what about expanding? Meaning get another place and doing the same thing. Interestingly, when it comes to AirBnb, if you are a highly rated host. It will carry on to your other listings. For example, say your Airbnb has 60+ reviews and you just opened another one without ratings. You have a host rating and when a user looks up your new place. It will say this host is highly rated and it will get your next place off the ground quicker. It's almost like seeing, hey, this person is trustworthy even though no one has been to this place yet. People want safety, a dirty place is one thing, but not being safe is totally different. That is why reviews mater so much. Having one highly successful AirBnb in say France, will even help out with your other Airbnb in California for example.
Detailed Binder and Personal Tour- This goes such a long way when you walk into an AirBnb. Giving a tour of the home in person when someone arrives. It becomes an introduction so they know you, plus you can point out little things to know in the home easier. Also a binder on the coffee table with all sorts of details in it is helpful. It just makes it more comforting to know what's going on, because after all it's not a hotel, but a home of sorts. Here some ideas for building a welcome binder.
- House Rules
- Owner Contact Information
- Address of the Airbnb
- Local emergency numbers
- Local hospital location
- Map of the area
- Things to do
- Tours to take (see our guide on this above)
- Food delivery options and phone numbers
- Story or history of the home
- Extra items in the home to use (example: fishing poles in garage)
So there you have it, there are some of the ways people are putting effort into and making it a full time job. It works, I personally know a good amount of people doing this. One person is even is projecting $400k a year going forward after only doing this 4 years.