Can I Make Money Through Airbnb
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Airbnb was founded almost fifteen years ago as an online marketplace for people to arrange to lodge, and individuals could rent out their space to just about anyone. Instead of paying for hotels with limited kitchens, travelers could book a room or an entire house online and feel like they actually live where they’re vacationing. Many people with empty spaces have successfully rented their rooms and homes out through Airbnb.
It takes work to manage renters and your space, but Airbnb can be a great side hustle, and if you have a few different properties, you can even make a really nice income through Airbnb. In this article, we’ll teach you how Airbnb works and how you can start making money on empty properties today.
How Does Airbnb Work?
Airbnb allows people to rent out their apartments or homes. Individuals with extra space on their property or an entirely empty property can subsidize their homeownership costs, similar to the way that many real estate investors house hacks. There’s a ton of demand because people are always looking for an affordable place to stay with amenities that you can’t get in a hotel room.
Airbnb depends on hosts, and the company does not hold any of its own property. Instead, they act as a middleman between you and travelers so you can list your property and help travelers find a place to stay for a fee.
Airbnb is incredibly popular with hosts and travelers alike because it allows hosts to easily find people to stay in their extra spaces while travelers have a nice homey place to stay that’s more comfortable and sometimes more affordable than a hotel.
Making Money With Airbnb
Just about anyone with extra space can make money with Airbnb, whether you’re renting out a room in your home or you have an entirely empty house just waiting for someone to use it. However, before you begin listing your rentals on Airbnb, you should make a plan. You should ensure your market has a demand, which means looking at the pricing of hotels in your area.
You should also understand who your market demographic is. Depending on where your home is, you might cater to travelers willing to pay for a nice place to stay during their vacation, or you might need to offer a more affordable solution to travelers just passing through.
How much you make on Airbnb will depend on your location, the number of rooms and properties, and your ability to market your space. You may also have to deal with tons of competition in the area if your property is near hotels. Of course, if you’re renting out an entire house, you can price your rental much higher than the average hotel room, just be careful not to price yourself out of the market.
Determining your pricing can take a little trial and error, and you may have to make adjustments depending on the season. For example, you may have to lower pricing in the winter when there aren’t many tourists, but you can raise it again in the summer, especially if your property is located near a beach or lake.
Most Airbnb hosts can make at least $100 per night, depending on the space. However, it’s important to remember that you won’t be fully booked year-round. So, unless you have tons of properties, you may not be able to earn a living as an Airbnb host alone. That being said, being a host is a great way to earn some extra income if you have the space to spare.
Considerations for Pricing Airbnb
Before you list your rental, you’ll need to figure out how to price it. Earlier, we said this would take some trial and error, but there are a few ways you can get a realistic price, which includes factoring in your expenses. Once you understand what the costs are, you can start to price your rental to make money on it instead of losing money or breaking even. Some of the costs associated with being a host are:
Insurance: You must have a renters’ insurance policy to protect against damage to your property or potential lawsuits.
Service fees: Airbnb charges a service fee that consists of a 3% booking fee.
Taxes: You must pay taxes on all of your income as a host.
Utilities: Always factor the average cost of utilities into your rental pricing, including water, electricity, internet, cable, trash, and gas.
Cleaning fees: After your renters leave, you’ll need to clean your rental to prepare it for the next traveler. Most hosts prefer to hire a cleaning company, which costs more money than doing it yourself.
Emergencies: As a host, you’re responsible for dealing with all housing emergencies, including leaks.
Moving fees: Whether you’re moving your own belongings out of a home or adding furniture to a home, you’ll have to deal with professional moving company fees.
Can Anyone Become an Airbnb Host?
Not everyone is eligible to become an Airbnb host. If you’re a renter, your rental agreement might forbid you from subletting or renting your apartment out to anyone else. Additionally, some buildings might limit the number of nights you can sublet your apartment.
In most cases, you’ll have to check with your landlord to see if they allow you to become an Airbnb host. Many apartment communities do not allow this because they believe it will cause disruptions to the other tenants.
However, if you own a property, you can easily become an Airbnb host. You can either rent out a single room or an entire home. Of course, there are still limits on who can become a host. For example, Airbnb requires you to maintain a good customer rating, which means you can get your listing taken down if you’re not providing guests with a high-quality experience.
Should You Become an Airbnb Host?
Making money through Airbnb is simple, but it can be time-consuming. If you don’t track your expenses, you can actually lose money through Airbnb, and it’s nobody’s fault but your own. However, if you become a successful host, you can start earning an additional income that allows you to purchase other properties and rent those out to make more money.
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Marné Amoguis holds a B.A. in International Business from UC San Diego. She is a contributing writer at 365businesstips.com where she loves sharing her passion for digital marketing. Outside of writing, she loves traveling, playing music, and hiking.