Thinking of buying a house

[Aviva14]

Hi Everyone, 

I have been to many AIRBNB and have always wanted to own one.  I finally found a great property with a pool and jacuzzi.  I came on here to learn about the process and I am shocked by how many “unfair” things seem to occur to the hosts.  Would you all still recommend I do this? Any beginners advice?  
please help me decide. 

[Helen3]

Read the advice and tutorials on this forum.

Presumably you have already done your market research to see what demand is like for the sort of place you are buying in that location and what people charge out at.

I think if you are relying on Airbnb to pay your mortgage, in the current climate particularly, that in my opinion is very risky, unless you can cover your costs comfortably through other means,  if you don't generate the expected income from STRs. Have a look at Airdna as part of your research.

[Alexandra316]

@Aviva14Definitely do your market research, particularly if you're going to rely on Airbnb money. See if there is a host group in your area that you can speak with and see how they're doing. You can also browse around the listings in your area to see what other people are offering, what kind of prices they seem to be charging, and how many days are available on their calendar. There is also a lot of wise hosts on these boards that can help answer your questions. As @Helen3 mentions, this has been a tough year for many hosts. 

I've been a host for three years, and I have had very, very few issues with Airbnb or guests. I rent out an apartment that's part of my primary residence. It's been a very good thing for me. I don't rely on the income: it's just some icing on the cake for me, and I've enjoyed it.  I will tell you something that I've observed: very few hosts in my particular area have stuck with it. Most of the people who were hosting when I started  are long gone, and many have come and gone in the time I've been hosting. I think it's more work than people anticipate. People think it sounds great: passive income! But to do it well, it's really not passive, and if people are staying in your primary residence, it can become taxing.

The Community Center is a great place and there's a helpful core group of hosts who help out fellow hosts and travelers, but many people only come here when they have a problem, so it may provide a somewhat skewed view of what it's like to host. For example, it's reasonably common to see posts here from hosts who have guests who won't leave the premises at the end of their stays. I've hosted approximately 350 groups of guests and have never encountered this problem. A lot of the situations presented are exceptions rather than the rule. 

My advice would be to make sure you fully read the terms and conditions of being a host before you list a property, and that you do some research on these boards so you can avoid some of the common missteps new hosts make. 

[Sarah977]

@Aviva14  Another thing you should do, in addition to the advice Helen has offered, is to research what is required, in the location of the home, as far as permits, mandated stay lengths, etc. 

And the house, as you describe it, sounds like the perfect place for guests to see as a "party pad", so be aware that you are going to have to vet guests very carefully and keep a close eye on what is going on there. 

"Ive been to many Airbnbs and always wanted to own one" sounds like you think it's just a great and easy way to make money and fun to boot. It can be that, although not the easy money part. I just list a private room for one guest in the home where I live, so I do enjoy hosting what have turned out to be a fun and interesting string of guests, and because I live here, guests can't get away with bad behavior. But an entire house listing is hard work, and fraught with possible bad scenarios, so be realistic in your expectations.

[Mike-And-Jane0]

@Aviva14 there are clearly risks in renting but don't be too put off by the negative posts always remember two things

1) For every bad experience 40% will post a review whereas its 1% for good experiences

2) 90% of stats are made up

[Huma0]

@Aviva14 

You've already received some very sound advice, which I would agree with. No, the CC is not representative of the percentage of hosts who have these kinds of issues because, as @Mike-And-Jane0 say, people are most likely to post on a forum when they are having a problem rather than start a thread saying, "Everything's great. All my guests have been fine." Doesn't make for very exciting reading either!

HOWEVER, I would second the opinions already expressed here that hosting on Airbnb is not necessarily 'easy money'. There is a lot of time and work involved and possibly more investment/expenses than you might image and yes, probem guests do come along from time to time.

Airbnb have in the past offered quite substantial incentives for existing hosts to recruit new hosts. Several people have asked me to advise them on stating an Airbnb business and, even though I could have made a few thousand pounds from referring them by now, I actually ended up putting every single one off! I wasn't trying to. I was just being honest because I don't want to encourage anyone to get in over their heads. Once I had explained what is involved in terms of time, admin, cleaning, laundry, sharing your space if you are a live in host, etc. etc. not one of them wanted to do it anymore. People honestly thought it was just a case of having a spare room (or other available space), listing it and raking in the money. Believe me, it is not!

[Ann72]

@Aviva14 I agree with the great hosts who've already posted here that it can be a wonderful pastime as long as you're passionate about sharing the house and making guests feel at home there.

My only caveat is around the pool and jacuzzi - because of liability issues.  You real estate attorney and insurance broker could advise you on that.

Chicago does have rules and @Inna22  is a top Chicago Airbnb host who you might want to reach out to.

[Inna22]

@Ann72 thank you for tagging me. @Aviva14 it sounds like this will be your primary residence? Will you be renting part of it and living on premises or moving out for guests? Is the house in Chicago proper? Pools are pretty unusual here. It is not downtown, I know that for sure. What area are you in? Why would guests visiting Chicago come to your area if it is not downtown? I would need to know the answers to give you better recommendation. As for the stories posted here, most will not apply to you. Pool and jacuzzi is a huge party magnet though and that brings me back to the questions I asked.

[Aviva14]

Hey, 

it is actually in south-bend Indiana about five minutes away from Notre dame. 
Any knowledge or thoughts on that. 
aviva 

[Kelly149]

so many ways in the world to make money.... is this really the one you want to pursue?

I have a house with extra space in it. I had built it and furnished it for my needs, which happen to work well for ABB guests. So, if they come, I clean it up, I take care of what they need, when things go wrong I deal with the ABB headaches (bc it's your house, but the $$ flows thru them), but if not another guest ever comes again then I will be just fine.

I don't think I'd recommend ABB as a "job", @Alexandra316 's mindset is ideal

oh, and don't set up an ABB unless it is legal to do so in the area you're considering

[Sarah977]

@Aviva14  Another thing- do not be under the illusion that Airbnb will repay you for guest damage. Their "one million $ guarantee" is so much BS. Some hosts have managed to get re-imbursed for damage, but it's not an easy process for most, and you may not get what you feel you should, due to what Airbnb considers to be depreciation value. 

So you'll need to have your own short term rental insurance, which is also something you would need to research.

You would also be advised to familiarize yourself with the neighborhood and some of the neighbors, maybe striking up a conversation with them if you see them outdoors, saying you are considering buying that house and feeling them out to get an idea of how they would react to an Airbnb "entire house" listing on their block. Many people are virulently opposed to that, with good reason- a constant stream of strangers, coming and going, can make neighbors feel unsafe and no longer like a "neighborhood" where most residents know each other, at least to the point where they would recognize each other, nod and say good morning in passing. And one loud or disrespectful group of guests can lead the neighbors to getting together to get you shut down. You don't want to end up being that person who incurs the wrath of all the neighbors because you thought running an Airbnb in a residencial neighborhood would be cool.

[Aviva14]

Hey, 

that is an excellent point about the neighborhood. Do you recommend knocking on their doors and asking them. I am worried they will probably say no and then I’m stuck since most people don’t want an Airbnb near them. what are your thoughts. 
Thanks also for the info about the red Uri’s meant. 
aviva 

[Sarah977]

@Aviva14  I have no idea what "red Uri’s meant." means, and can't even hazard a guess 🙂

Well, I wouldn't necessarily come right out and say you want to buy it and use as an Airbnb. More like walk around the neighborhood a bit and get the idea of what kind of place it is. Is it full of families with children? Young professionals who may be out most of the day? Lots of older, retired folks? Or a total mix of ages and lifestyles? Do people seem friendly or stand-offish, looking at a stranger walking by with suspicion?

And if you talk to any neighbors, you could ask them what sort of neighborhood it is, if people pretty much stick to themselves, or whether there's some neighborhood interaction. You could ask if they know if most of the homes are owned by the residents, or rentals. You could even ask if there are any Airbnb's around, as if you might be concerned about that.

I've read posts from hosts where they sent letters to all the neighbors, saying they wanted to do an Airbnb, letting them know what sort of guests they would look to attract ("it's only for 2 people max, no party scenes, and we will be extremely careful about who we rent to"), but those were hosts who already lived there, knew their neighbors, and were just looking to convert a garage on their property to a small Airbnb or add a studio addition to their own home.

Basically, sorry to say, but I don't think anyone really wants an entire house, off-site host Airbnb in their residential neighborhood, unless the neighborhood was filled with young college students who wouldn't care. If you were planning to live there yourself and just rent out rooms, that would be a different scenario.

[Lenore22]

Great point, @Sarah977 about the neighborhood!  @Aviva14 we are in the same shoes-- just bought a vacation home for ourselves with the intention of renting out when we aren't there.  Luckily, our only next-door neighbor brought up that she had her house listed as a vacation rental for about 8 years until 2 years ago.  Like us, it was just to offset expenses and not have it sit vacant, so she was able to share some well-thought-out advice and insights, but is generally understanding of the need to offer STR.

It is tricky coming from our position- most guides for new hosts are assuming you already have a place and are considering hosting.  It's very different purchasing a property with the intention of offering a Short-Term Rental.

[Inna22]

@Aviva14 in Chicago you can not just list a house that is not your primary residence. There are pretty complicated hoops you have to jump through to do that and you might not get approved (mainly depends on your Alderman). If you are not going to live in the house, you need to first meet with your Alderman to see if he/she will support you. Then you will need to figure out how you are going to protect it from parties. You can message me privately if you would like