Is it worth it?

[Gary496]

I would like to know what other hosts are doing to be able to not only meet their expenses each and every month but also make a profit. We currently live just north of Daytona Beach but have family in New England and considering buying a home (not a fixer upper either) so that we could spend summers in New England and go back to Florida in the winter, (snow birds we call them). Please I don't want to hear from any realtors (or used car salesman either)....LOL.

Just honest and sincere thoughts on the subject.

Thanks,

Gary 

[Yadira22]

Hi @Gary496 

hope you are well. 

As the landlord it makes sense to us but we are very strict and consistent with maintaining costs down and recorded! Everything like cleaning, ironing etc we do ourselves and therefore this helps towards this- realistically as I work from home and my father (business partner) has a more flexible schedule it does help a lot. 

Regarding profit this is ultimately up to the invidual as we are in it for the long run- any profit we try to put back into paying the mortgage quicker and having a rainy day fund. 

Its better than renting and it is a lot more work but if we clash with someone we wait for the person’s stay to finish (maximum 17 days) and it goes back to normal vs one month notice. Furthermore 99% of the guests are awesome- and it’s nice to meet travellers, some feel like friends after and it’s definitely an experience. 

Also when starting out the first 6 months are the hardest but just persist, ask for help when you need and be open to it. Consider its also not for everyone! 

Hope this answers your question! 

Yadira 🙂

[Jayesh5]

@Gary496 

If you are looking at a place that is head and shoulders above the rest on offer and are prepared to put in the work to list on multiple sites AND you are confident you can organise a good cleaning crew then maybe - but - that is just a maybe...

Get a price for good STR home insurance as Airbnb is the one site where you are pretty much not covered by them AT ALL.  With other sites you are able to pre-authorise a credit card deposit. 

As a long distance host you have to look at about a 20% management fee and a 15-20% commission fee on your nightly rate. If your area is subjected to local taxes, you also have to figure that in when looking at rates unless it is noted on the listings in general that this is collected on arrival.

From what I can gather in our area, these are mom & pop operations where all the labour is done for a cost way WAY below outsourcing. This will be your stumbling block. We have to outsource but can command a good price across all sites for the cottages so it is working out okay for that property. 

Hosts are able to cut the market when they include their free labour so you have to be in a desirable location and be prepared to sit empty if your price is not met. You can’t cut the price on what you offer and expect that good guests will turn up - this is a magnet for bad guests. 

I had my pricing all all sorted out for both properties which took about a year for me (but see some wheelhouse posts in the search bar) and last Easter we accidentally released 1 night at low season rate. We attracted a poor guest who left a poor review which is pretty standard. 

Knowing that this is very labour intensive and you are not onsite to contribute I would be really crunching the numbers before starting this venture unless you need negative gearing.

With the second property we are counting mostly on the increase in property value to “cash out”. There isn’t a big margin in the industry if you outsource all work unless you have a highly bookable property at the price you need. 

However, having said that, the second property  is paying the mortgage & expenses & a reasonable living but we are here and can look after maintenance or any lapse in cleaning crew. 

Knowing what I know now as just an “investor” at the onset, who has been dragged into the mgmt I would say no - no - no, rent an Airbnb when you go to the area and stay there and keep the money for a home that will be just yours. Lisa

[Jessica-and-Henry0]

@Gary496 

Without a very trusted on-site cohost and reliable cleaners, I would be very hesitant to host an entire home as an off-site host. Being an Airbnb host is like having a second job or managing a small business. There are so many things you need to consider. 

[Ana1136]

@Gary0 as @Jessica-and-Henry0 and @Jayesh0 said, I would also consider very very carefully whether I want to be an off-site host. On the other hand many people do it so it is doable but it will be harder to make profit because you will have much more expences. You have go do a detailed research on the prices in that area. I am an on-site host and between me, my parents and my brother everything is very easily done. We don't pay cleaners, every one of us know how to repair different things so we don't pay repairmen, we buy everything from a local factory in bulk so it is cheaper.. we have many ways of cutting down expenses which if we didn't in a place like Ohrid where accommodation is so cheap we wouldn't even be able to meet our expenses let alone make profit.

[Emilia42]

@Gary496, adding to what others have said, keep in mind that New England has seasons. You are going to be living in your summer home when everyone else is traveling to the area. Depending on where you buy, you may have to shut your house down in the wintertime or expect very few rentals.