Everyone wants to get in on this Airbnb thing....

[Laura2592]

SO many of my friends and acquaintances have been asking for my advice on how to "make money" on ABB/how to find the right property. Its crazy! Anyone else noticing this uptick in hopeful hosts?

[Branka-and-Silvia0]

interesting.... here in croatia hosts are switching from STR to long term rentals. Covid hits our tourisam very hard

[John5097]

Nightly rates are really high right now which may be driving more interest, but there are so many risk and factors involved it only makes sense for certain situations, and need a plan B and C.    

[Elaine701]

https://www.ekathimerini.com/economy/1165179/surge-in-airbnb-style-rentals/

[Flavia202]

That used to be so in Jamaica in times gone by BC (before covid).  Now, a lot of hosts are switching to long term rentals. 

[Robin4]

@Laura2592  @Flavia202  @Pete69  @Elaine701 

The question does crop up continually now. It never used to, but when I started out in 2015 most people here in my country did not know what Airbnb was. It was growing rapidly but it was a curio rather than a (to be pursued) business model.  Now things are different, everyone has an opinion, either good or bad, about Airbnb, and most are of the opinion, if it has grown so quickly it must be good, it must be worth being in.......people must be making money and plenty of it!

Whenever someone finds out I am involved with Airbnb the first thing they say is....."Do you make good money out of it" 

If they are genuinely interested in knowing how it works I say to them......

"If you are fortunate to have a bit of real estate that is just sitting there doing nothing, it doesn't cost you anything or owe you anything and you are prepared to accept strangers and be something of a prisoner in your own space, then Airbnb is a great way to make a bit of money. If the property you wish to rent out is under mortgage and you are compelled to find a certain amount of money each week to cover expenses, Airbnb-ing your property could be a shortcut to financial ruin, the income is not reliable" ! 

They look at me and say....'Why do you do it then'?

I tell them I do it because I want to, not because I have to! Airbnb have introduced me to many hundreds of lovely people, and the fact that I have a bit of money over to put in my bank account is the icing on the cake!

If you are going to do Airbnb, you do it because you want to, not because you have to!

They have a puzzled look on their face and you can see their minds trying to comprehend what I have just said, as they wish they had not asked that question!

Cheers.........Rob 

[Flavia202]

Cheers, @Robin4!

[Laurelle3]

@Robin4 I agree with everthing you have said. We started our Airbnb because we have a cottage on our premises which we lived in whilst renovating the main residence. Financially we are lucky or worked hard in in our working lives and are not committed to anyone but ourselves. 

We have tried Airbnb in other countries whilst travelling so had a preview of different standard's and styles being offered. We have experienced YHA's and Backpackers in the past to fit into our budget in the past with our young family for many years which has shown us another style of accommodations. We have been involved with Scouting as Leaders for 35 years and have experienced another style of accommodation outdoors in tents or by sleeping lodges in bare bunk beds or on the floor.

When I sum this up, we love meeting people and want to share our hospitality, friendship and local area and community with others. Yes, you have to make an effort to provide the best you can for your guest. Our generosity comes from within, at the same time enjoy what you do because it shows in your reviews from your guests.

[Christine615]

I agree with some of the others. We jumped into Airbnb after watching our neighbor do it for a year. We enjoyed meeting the guests (it's a shared driveway) and talking through logistics. But we all tell new users, it can be a great experience, but it's still work.

But now I'm seeing posts on other social media networks where hosts are claiming to make earn unrealistic numbers each month. So other people are bidding up housing prices thinking Airbnb is a get rich quick scenario. Or doing the arbitrage thing. Well just ask all the people who jumped into the gig economy for Uber or Lyft or driving for Uber Eats or shopping for Instacart groceries how that is working out now. It's hard work, a lot of hours, a lot of wear and tear on your personal vehicles.

We thrive because we've owned the building for a while so we're more cushioned for slow periods. During Covid-19 lock-down we could afford to put up buffer days between guests and still make the mortgage.  Nowadays, people are buying houses in our area at inflated rates and are saddled with huge mortgages. They're having to book back-to-back to make the bills and now - with Covid-19, many are struggling to find cleaners, contractors, etc.  Will be interesting to see how this works.

I agree with @Robin4 Do it because you think you'll enjoy it and because you want to, not because you "have" to. I think, long term, Airbnb will thrive if they recruit more hosts that think like that.

[Elaine701]

You can make pretty good money under the right circumstances, if you have a formidable listing, maintain high standards, and are wise about managing it. There is no "easy money".

But nobody gets rich doing this. Except maybe real estate moguls with 100+ apartment listings. Even then, the management burden is high. And not cheap, but many in that situation can leverage economies of scale and increase their profit margins. The average host doesn't have that advantage. 

[Laura2592]

@Elaine701 judging from landlording and hosting, the effort required to do ABB successfully is exponentially higher than being a landlord. Most people who are "rich" want the most passive income possible. Traditionally stocks are better than property as you can buy and sell without doing much, and property of any kind requires some upkeep. In the world of property, commercial is generally more profitable than residential. If you chose residential, being a regular old landlord is more profitable than being an ABB host generally. Time is money and guests are a lot pickier than tenants. No one is changing tenant laundry or writing them guides to the local area. Most apartment or rental home units are not furnished much less set up with treats and decor. So basically in terms of the becoming rich ABB is one of the silliest ways to try and go about this. 

It does fill a niche if people enjoy meeting others, or have a place they one day want to live, hopefully in an attractive area and want strangers to pay their mortgage in the meantime. Or they have a second home they don't mind opening to people for the same reason. It can help offset costs of ownership. But I think its a poor strategy for the primary purpose of wealth accumulation. 

[Robin4]

@Elaine701 

On the strength of our cottage rental on Airbnb I  bought a houseboat for short term renting.

here it is .........

Great living area with all the mod cons

On the upper deck even has a Jacuzzi

Sleeps 10 really comfortably with  three en suites.

The thing I didn't take into account is.....it is a depreciating asset!

Every year it is worth a bit less than it was the year before, unlike shore based real-estate.

It is fully booked, but the reality is we are going backwards all the time  and it has not turned out to be a good investment!

We have now sold it and have chosen to put our money into investments that will guarantee us a positive return!

Cheers.......Rob

[Laura2592]

@Robin4 that is a lovely houseboat! I am sad you sold it. But I have heard owning a boat is a huge headache. 

[Robin4]

@Laura2592 

Yeah is was sad to let it go but as I said, It's not like a house or an apartment Laura, it's a depreciating asset!

Ever year it is worth 8% less than it was the year before and when you are talking about a $400,000 investment that is $32,000 worth of rent that simply goes nowhere just in the first year!

And people always want to rent the latest and the best. Once it get to 6-7 years old you can't ask top dollar for a rental boat any more.

It was great while we had it, spent lots of fab nights and days on the river with it but, we were getting less and less out of it for the effort we were putting in.

It's like buying a motor vehicle, buy it to enjoy it, not make money out of it!

Just another thing I can cross off the Bucket List though!

Cheers.......Rob