hi there, me again, can you take a look at the properties an...
hi there, me again, can you take a look at the properties and tell me what i could do to improve them please?
Answered!
I was asked on another site......What are the key steps and considerations involved in starting an Airbnb business, and what are some tips for success in this field?
Starting an Airbnb listing can be profitable beyond your wildest dreams however, there is a ‘Goldilocks zone’ which determines if you will make money or lose it.
1/……..Establish what regulatory controls may be placed on short term rental (STR) in your area. There is absolutely no rationale for setting up an STR if local government will only allow you to list for 90 nights per calendar year. Here in Australia in most less dense population areas there are no STR restrictions. We can let to our hearts content!
2/……..To purchase a property for the sole purpose of STR in many instances will be a financial disaster! Hosting regulations change, and expensive commitments can spiral in cost making STR not appealing to guests and limited reservations will not cover the outgoing costs. Almost all long term rental apartments or free standing rented properties will have a clause that forbids STR. As soon as a landlord finds out that STR is taking place in their property they will terminate the tenants lease. The reason for this is, as the tenant you have altered the terms of the insurance risk the Insurer approved when they offered a policy of coverage and they will cancel their policy. Similar with a purchased property that is subject to an HOA. STR insurance is considerably more expensive the long term rental insurance so HOA’s simply forbid STR. I can’t tell you how many thousands of hosts have found this out to their cost.
A freehold property is different! There is no mortgage to cover, no landlord to satisfy and anything you make from STR will be the ‘icing on the cake’. In general hosts who own their properties outright make far better and more sought after hosts because they are not compelled to charge a premium for their listing. They can supply considerably better value for dollar spent.
OK, the council regulations are favourable, the property does not have a large financial commitment to satisfy, there are no rental landlord or HOA roadblocks……..you are in the 'Goldilocks Zone', now to set up your listing.
3/……….A wise person I know as I was starting out said to me….”Don’t put anything in the property you are not prepared to lose”!! Remember, this is your turf and you know where everything is and how it works, Your guests will be strangers on your turf and accidents will happen, things may get stolen, You need to be conscious of this and allow for it in your listing amount!
Before you word your listing description ask an acquaintance (not a direct family member) to walk through you listing and help you word your description. As I said, remember what you offer is ‘bleedin’ obvious to you, is going to be strange to guests. Word your description as a stranger, be descriptive and comprehensive.
4/……Pricing your listing:, Don’t try to be the cheapest in the area! The whole reason for doing this is to make money not lose it, and many hosts don’t do a proper ‘profit and loss’ sheet, they don’t take into account certain hidden costs and can’t understand why they are going backwards despite putting in the effort. I run a proper Excel spreadsheet which I update regularly which tells me exactly what I need to charge to make the profit I require…….
Yes it comes at a bit of a surprise when you realise what you need to take into account. Too many hosts are influenced by Airbnb’s pricing tips and end up doing nothing more than lose money. As far as Airbnb are concerned your property will never be cheap enough. Whether you make money or not is not their concern, they just don’t want to see a potential guest escape to another booking platform!
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Okay, now you are ready to go public and wait for the guests to book. You have established that you are allowed to STR , you have a property that is not financially burdened, you have described it properly and you have priced it in order to make some money out of it……
5/……..I have found establishing your market has little to do with profitability. It is up to you as the host to attract guests….not just expect them to flock to your door simply because it’s there. There are 6 million Airbnb listings around the world in the hands of 4 million Airbnb hosts. In many of those areas the market is saturated, there is an oversupply of properties and hosts are undercutting each other in order to attract guests. That doesn’t mean you can’t be successful! You have to make guest want to come to your listing over others…….pay that bit extra by what they see in your reviews and what you offer.
My single studio listing is nothing special…..it’s just an 80 year old converted garage in a country town in the back-blocks of nowhere………. but we are fully booked month after month and have been for 3 years now. The secret is to give the guest something they are not expecting, some nice little touches you don’t describe in your listing description. The less a guest expects, the more they will be delighted with what they get.
Here is our current April 2023 Airbnb calendar……..
Every month is just like that! In all probability we will only have one night for the month of April without a guest present here. The night of the 3rd was a booking not related to Airbnb.
You can see, despite our modest nightly charge we are bringing in around $3,000 per month of which we get to put about $2,200 into our pockets. That’s about $550 clear per week which, in our retirement and with our other investments and age pension gives us a really comfortable lifestyle of about $6,200 per month.
I am not greedy, I could charge $50 pr night more but, I have a hassle free existence. As the nightly charge goes up, so do the guest expectations! I would rather be fully booked and have a heap of 5 star reviews than wonder where the next booking is going to come from. Here are our current Airbnb booking confirmations for the last 30 days………
As I said at the start of this post, listing with Airbnb has surpassed my wildest expectations, If I was to rent this listing on a long term rental basis the most I could get for it would be $250 per week…….I am getting almost double that with Airbnb but, for me all the planets have lined up, I have the right property, I have done my homework, have set it up properly and I am not greedy!
There is a lot more to it than what I have described, such as how to pick the right guests, covering yourself for problems and how to review but, I have to stop somewhere and I am sure this is already a long boring post but, I hope it can save some from disaster………and help other to riches,
Cheers…….Rob
1 Best Answer
My feeling is guests in general are becoming a bit more entitled than they were a few years ago. They expect things now that they never used to. Like they expect the use of my personal garage now for their car parking! They are asking for condiments that I do not routinely supply like gluten free bread or a specific brand of coffee.
I am happy to comply Bhumika but a few years ago they never had the 'front' to ask, now they expect it. Airbnb are loosing sight of where their business comes from by being a bit too guest centic!
But having said that we are doing just great Bhumika, April is not an apparition.......we are as full as a 'fat mans sock' month after month! Here was our March calendar......
And our May is filling up with only 10 nights vacant......but they will all be taken by this time next month.
It's solid work because I don't give myself some breathing space.....I am happy to accept guests two hours after the last guest has departed, no problem!
My rationale is, I have this facility available, I have good help, why should I let it sit empty for a night or two between bookings. I am in this hosting business to make a bit of money, not have a leisurely ride!
Having said that, every guest is interesting! Current guest is from Dusseldorf and is on his gap year discovering the other side of the world with his uncle. We have given my wine cellar and the piano a bit of a hiding tonight but, Bhumika for me the experience is more important than the money, I am holding hands with people from all over the world.....and isn't that what Airbnb is supposed to be all about!
Unfortunately I haven't had time to edit and post a video clip of this track but I hope you get the idea!
Cheers.......Rob
My wine cellar has taken a bit of a pounding over the last 2 nights, this was last nights effort!
The Para Port and the 2 bottles on the right
But this morning after I saw them off and walked into the cottage, these two guys left me 2 not bad bottles of wine as a thank you!
So it all evens out, they had a great time while they were here and I had a great time having them here.
Cheers........Rob
