What are the requirements for running a successful Airbnb rental property?

[Robin4]

1/….. Think about what you want to achieve:

Many new hosts think Airbnb will be a pathway to riches…..it won’t. There are some entrepreneurial hosts who will make a lot of money out of Airbnb, but they are few and far between. They have come from a business background and have plenty of money to splash around to secure the services of desirable properties. But what differentiates them from most Airbnb hosts…..they are driven, and they are ruthless!

If you expect that you are going to achieve their levels of success you will be disappointed.

Be modest with your goals, and if you exceed them you will feel far more of a success, and that will translate to confidence, rather than if you set the bar too high to start with.

2/….Describing your property:

Thirty seven percent of guest disputes stem from property description, the guest doesn’t get what they thought they would get.

When wording your listing description, do it with an acquaintance, somebody you know well but, who is not a friend, someone who does not know your property. Remember, it’s your turf, and what seems obvious to you, guests are going to struggle with. You need to describe your property in an accurate impartial way……and that can only be done with outside help!

3/…..Pricing my listing:

Your property is never going to expensive enough to satisfy your wishes, but it is never going to be cheap enough to satisfy a guests wishes. The worst thing you can do is try to compete with your opposition.  The most common issue we hear is ‘If I charge any more than $XX per night I won’t get any bookings’……rubbish. You need to first establish how much money it is feasible for you to make each night based on what makes your property financially viable, and then find a way to make your listing a bit more desirable and worth paying those extra dollars for. Being the cheapest in your area will attract the guests you want to avoid……the bottom dwellers who you will never satisfy. You must appeal to guest’s strengths, not their weaknesses.

You need to offer a gimmick, something that makes a prospective guest want to stay with you, something that the guest is prepared to pay a bit more for the experience.

Appeal to their senses, offer a cool space on a hot night with an ice cold beer, or a warm cottage with the electric blanket on the bed turned on and a steaming cup of soup on a freezing night. I had one guest who said….”I never appreciated pumpkin soup before last night, thank you so much!”

Guests pay for that, and it sorts you out from the competition….and the reviews that come keeps the bookings rolling in!

4/….. Don’t hassle the guest when they are there:

Don’t put up lots of 'post-it' notes telling the guest what they can and can’t do. They have paid you for the use of your property, let them enjoy it. Guests don’t want to be bombarded with lots of instructions, so be prepared for a few dishes not done, the garbage not put out in the bin, towels left on the bathroom floor. All these things are going to have to be done during servicing anyway, don’t make the guest feel guilty because they didn’t do it! Let them leave happy that they have had a good time and would like to return again.

You charge a cleaning fee after all, leave it at that!

5/…..How to handle the review:

The guest review will tell the world just what sort of host you are. Most reviews will be easy to write because the experience was positive.

But if the experience was not completely positive, never write a review out of emotion! Wait for a couple of days, make yourself a cup of coffee and put the hosting in perspective. Was the indiscretion that bad that you needed to take the guest to task? Remember the review is going to say as much about you as it does about the guest. If there is a diplomatic way to word your review and still get your point of view across……do it. Don’t get involved in a verbal confrontation with the guest. And most importantly give an accurate review. Nothing makes a host look more stupid than a review he/she has given which says what a model Airbnb-er the guest had been, and then tells the world in the guest review response  what a bloody slimy piece of sh*t  that same guest was.  Don’t ever get into a review situation where you have to back-track.

6/……When things don't go well:

If things do go off the rails and the guest breaks something or brings more people than allowed for, try to sort it out with the guest instead of running to Airbnb and expect them to prop you up. Most guests are responsible and are keen to make amends for the odd bit of damage. If something minor gets broken, in most instances it is an accident, don’t publicly cane the guest over it, give them a bit of slack and in most instances they will meet you some of the way. Put an extra dollar or two onto your listing amount to make up for the odd minor indiscretion.

If the damage is malicious and major…..well that is what you have STR property insurance for, and if you don’t have that…..you should not be hosting anyway.

These are my observations over the past 5 years of hosting. Some hosts will not agree with what I have written here but the steps I have outlined here have lead me to a very successful hosting experience, and I hope these observations can help others to achieve success with their hosting as well! 

Cheers.........Rob  

[Sam4395]

I particularly like your comment about just letting the guest enjoy the property and their time spent. I find so often that hosts try to bombard their guests with rules and preferences that mitigate the risk of pet peeves. Viewing your property through the eyes of a guest is something I try to do constantly and I think its valuable when you are adding improvements to the space as well. 

[Diana-And-Lando0]

Successful hosting is to treat people like you want to be treated.  You want a clean, well maintained stay first of all.  You want a host that communicates with you and a place that is ready at check in time.  You want to feel like some one cares and has special touches. You want to listen to your guests and if a few guests comment on a way that you could improve the place you do it.  Being a host is a hard job and your motivation is when the guest is happy.  I feel that too many people have jumped onto this (I can rent my place out on Airbnb) and don't realize that it is a commitment to caring for other people. Not just get a management company and sit back.  Even if you go that route, you need to over see and check things.  This is your business and successful businesses do what they say!  Inspect what you expect! Treat people the way that you would want to be treated!

[Helen2428]

As a new host can I ask what you think about smart pricing? I was interested @Robin4 in the comment about not being the lowest in the area. We have set a price somewhat above that suggested! 
Also could you please explain exactly what kind of insurance policy you are referring to? 
really appreciate all the advice! @M199 @Diana-And-Lando0 

[Diana-And-Lando0]

Aloha Helen,  I don't use Smart Pricing because it seemed as though Airbnb's range was dropping my daily rate too low.  I want to be in control of my pricing.  Beware, also to check your calendar on a regular basis.  I don't have smart pricing, but it got into my system and so when someone booked I wondered why what they were paying was much less than my nightly rate.  Also, sometimes I will look at my calendar and the pricing will be wrong and I have to manually change the nightly rate.  The Airbnb system has a ton of bugs and strange things happen to your listings.  Airbnb of course will blame you and say it was you that did it.  So make sure to check your listings and calendars on a regular basis.  Also, Airbnb will change their policies and not send out any emails that they are updating something.  I recently had a person from Korea stay with us and she decided to check out early to go to the beach on the other side of the island and they gave her a full refund during her stay.  If you are interested in that just search for Korean visitors in the Airbnb community and you will see a lot of hosts commenting about new policies that they made without informing the hosts.  Wish you all the Best! Much Aloha!

[Robin4]

@Helen2428 

Hi Helen, Airbnb are in the business of making money and the way they do that is by charging a 17% 'service fee' for each and every booking they facilitate between a guest and a host.

Covid-19 has put a considerable dent in Airbnb's bookings so let's look at the last year before Covid struck!

Airbnb had, for the 2019 year, 272,317,150 reservations for a turnover of $38.2 Billion. I don't have information on how many of those reservations proceeded to successful stays without cancellation with a refund of the service fee but, it would probably be around 90%. 

Using those figures, Airbnb in 2019 from their turnover made a working profit of $4.7 Billion less the 10% they possibly refunded, in service fees. That didn't equate to a net profit however. It acquired 'Luxury Retreats' in 2017 and 'Hotel Tonight' in 2019 which put a large draw on the balance sheet!

Airbnb are also aware that their business is about 20% of the available market, as per this graph.....

Many potential travelers compare platforms to find 'the best deal' and it is in Airbnb's interest to secure as many reservations as possible for their outlay in running the platform.

Helen, the end result of this is Airbnb do not want to let a potential guest escape to another platform, so for that reason they will do everything they can to entice a host to lower his price to make his/ her property more attractive on Airbnb than it is on other platforms. 

If you pay attention to and use Airbnb's pricing tips you will lose money....unless you are a professional host and understand how to use them. 

*

As far as Insurance is concerned, most general insurers do not insure a property for short term rental (STR), in fact as soon as they become aware that STR is taking place in their insured space they will cancel their policy of coverage. The reason they do this Helen is because (By doing STR) you have altered the risk the insurer accepted when they offered a policy and premium.

It's like buying a motor vehicle, insuring it comprehensively for private use, and then using it as a taxi or an Uber.....you alter the risk, and the insurance company cancels their policy!

There are however insurance companies in each country who do specifically cover STR properties and a call to the Insurance Council in your country will put you in touch with a suitable company. Some general insurers will now add STR to their existing insurance cover but it does considerably raise the premium. 

The best thing I can suggest Helen is consult an insurance specialist who will be able to advise you much better than I could. 

What I was saying in my first post on this thread, don't attempt to rent without making sure you are covered adequately......and that does not involve trusting Airbnb to cover you.

All the best Helen.

Cheers.........Rob 

[Elaine701]

@Robin4 @Helen2428 

We have full insurance coverage specifically tailored for STRs (as required by law here) through "Linea Directa" ("Direct Line" for English speaking countries). 

[Twila7]

I was interested on the insurance mention too. 

[Helen744]

Helen 744 @Helen2428  Hi Helen , the very simple reason I do not use smart pricing is because it does not differentiate between a three bedroom house or a one bedroom bedsit. Pricing is a bit tricky and takes time to work out but if you lose your five star rating then it can be more difficult to get bookings regardless of price. Some people simply put on the highest price possible . That does not work either . Prices on weekends or public holidays may need adjusting weekly . Discounts for long term stays and extra fees for cleaning and extra guests will also affect the overall price the guest pays .If you are a middle of the road type of booking for families and general guests then also be aware of the price filters people may use to find accommodation. Some people expect more than they find when they come in your door but in the end it is those who are pleasantly surprised who will give you the best ratings and keep the guests arriving . Its a juggling act but no one wants to feel ripped off.

[Helen2428]

Hi @Helen744  Yes we have abandoned the smart pricing totally and been experimenting with different rates but still getting good bookings and all 5 star reviews so we must be doing something right! Hoping to get Superhost next weekend as we have met all the criteria. Enjoying it so much more than I expected. We love meeting our guests and talking to them. It's something we prefer when we are guests too - much more personal and so much better to get local recommendations.

[M199]

@Helen2428 

I use smart pricing only during the off season.  As well, I do my due diligence by weekly searching and reviewing local hotels, motels, Airbnbs.  I compare what I offer to the others.  For example, a small motel on the highway about 5km away charges $99 per night.  Guests have no amenities and have to listen to traffic.  Our place is a very private lot and we have over 50 listed amenities.  We also like to throw in freebies like homemade bread, custom totes (they'll remember us when shopping😉) and bottled water.  Promise less, deliver more.

As to insurance, I can't advise, but my recommendation would be to talk to your broker.  They have the knowledge and experience.  Happy Hosting!

[Petrina3]

id like to add that communication is vital...be responsive!

[Clara116]

@Robin4  Hey and cheers to you and Ade,

Good list Rob and nice to see many hosts adding to it since we both know that there are so many facets to hosting and viewing from all of them is the critical factor and what helps make a hit, successful and profitable Airbnb. 

I think if we can remember how we felt and what all we did for our first guests and work to treat each guests like the first guests we will do well. As you know I have loads of ideas and additions but short on time today so I'll work to get back to this and perhaps add a couple. 

All the best and happy  hosting Rob!

Cheers, Clara

[Cathie19]

@Robin4  - well said my friend!

[Martin3892]

how many great tips, thank you all for sharing your invaluable experience

[Yinette1]

Wow! I havent started but all these ideas help me get an idea on how to start and deal with situations that I will have to face in the near future.

Thanks