Is Airbnb a Profitable Business Investment for You?
Traveling and exploring the world has become a booming business in today’s times. Having said this, the demands for services which are associated with travel and tourism is higher than ever. An example of the mentioned services would be accommodation.
Owners can take advantage of this booming industry and make a decent profit by renting out their properties (provided that the latter is comfortable and reasonably priced). How does one accomplish this goal, though? One way is to utilize the business platform popularly known as Airbnb.
What is Airbnb?
Airbnb, when broken down into its simplest definition, is an online marketplace that specializes mainly in providing accommodation for travelers or tourists. It functions primarily as a “middleman,” or a broker which then receives monetary compensation for each successful booking. This being said, Airbnb isn’t the owner of any of the listed properties.
The company had its start some eleven years ago. An enterprising duo (who was actually roommates) had the idea of converting their living room space into extra accommodation. The conversion was done by simply putting a mattress in it, thus transforming the room into a “bed and breakfast.”
From there, the initial concept of Airbnb (or air mattress bed and board) was conceived. Fast forward to around a decade later, and the company already boasts of an estimated net income of $93 million. Perhaps this success is what led many property owners to try their luck in enlisting their properties at Airbnb.
How does the Airbnb Process Work?
Since Airbnb is first and foremost an online property hosting site, most of its transactions are accomplished through the internet. It seeks to bring together hosts who are putting up spaces in their properties for rent with potential guests who are looking for convenient, safe, and comfortable accommodations. In return, Airbnb gets to acquire approximately 3% commission from successful property booking as well as a 12-15% “service fee” from the guests.
To be qualified as a property host in Airbnb, there are certain requirements which need to be met. Suppose a person has a room or even a house to put for rent. He will then have to register it on Airbnb. By this listing, the property’s specifications (including floor area, number of rooms, and other pertinent information) will have to be declared as well. The property owner will be prompted create a profile with an accompanying picture. After the completion of the formerly-cited process, he has to undergo a series of verification which includes checking the owner’s phone number, and accompanying identification documents.
There is a caveat to keep in mind though. Before enlisting his place in Airbnb, an owner must first check whether it is legal to do so in his area. This is due to the fact that there are laws which prohibit the listing of home spaces for rent for extended time periods in other areas.
Once all of the required processes are done with, the property owner can now go to the section of the Airbnb website which is where he can describe the property in more detail. These may include: specifying its location, the number of guests it can accommodate, and whether it is currently available. Not only that, the owner also has the option of listing the price for a night, a week, or a month’s worth of stay.
Suppose an owner requires pictures of his property, but is not that much into photography. Airbnb can also provide free of charge photography services (that is, if he area qualifies for it). This assistance is provided so that the property owner can make his place look eye-catching, therefore increasing its chances of getting noticed by potential guests.
The final say on whether the guests get approved or not are ultimately at the hands of the property owner. Once a booking request is received by him, he will get to transact with the guest/s directly.
How Profitable are Airbnb Ventures (And Is It for You?)
Tourists and travellers will always be in need of accommodations which fit their budget and are safe, as well as comfortable. Therefore, it might be a great idea for someone who needs extra income (and has a place to rent) to venture into this business. But how profitable is the Airbnb business anyway?
As expected, there is no single exact amount which can be considered as the “income standard” of Airbnb property hosts. However, some experts have determined that hosts earn about an average of $924 dollars a month. This is just a “safe estimate.” Some people who are dedicated to the venture are reported to purchase multiple properties and then proceed to rent them out full-time. They are said to earn an income which hits the six-figure mark.
With all these facts and figures laid on the table, is Airbnb for you? The answer to that specific question depends on a variety of factors. Investing to become an Airbnb host can be a lucrative decision in certain situations. One of these situations is if the would-be host is in possession of a property which is located in a “popular” area (e.g., beaches and other tourist destinations).
With the scenario mentioned above, renting out the property Airbnb-style for a brief period of time might bring in the desired income. However, there are several things to remember. First, one should be prepared to dig deep into his pockets should he wish to start investing in Airbnb. This is for the initial purchase of a property (in case there is none yet). If the potential host already has the property, he must prepare to spend time, effort, and cash in maintaining it. Not only this; cleaning up after the guests have left also requires resources.
To make the story short, Airbnb could be a profitable venture if you are not afraid to take risks. Also, you must be organized and detailed, especially when it comes to undergoing the process of registering the potential Airbnb property. The Airbnb venture can be a lucrative one if an individual takes the effort and time to learn and master it thoroughly.
How to Ensure Your Airbnb Property Gets Noticed and Booked?
Airbnb could be a very profitable venture. However, as time passes by, there could be a lot of potential property hosts who are clamoring to book guests. Therefore, it is imperative that a host’s property stands out in a positive way. There are several means to accomplish this. The list below shows some of them.
Make sure that the property listing information is up to date. This is actually a very effective way of making sure that the property will get noticed and also booked. People are always looking for the place which suits their needs, wants, and budget restrictions. Thus, it cannot be mentioned enough the importance of keeping your property listing information accurate and updated as possible.
Set a competitive price rate. The most eye-catching properties do not always get the attention it may seem to warrant. Rather, the one who get the fair share of the spotlight are those whose prices are in the competitive range. This being said, the property owner must then research on a number of factors to determine the price range of his property. He can also come up with various marketing strategies to entice potential guests.
Always make sure your focus is on the right people. One way to entice potential guests is to make them know your place is worth staying in. Therefore, a property host should find ways to make the property more appealing to them latter. This can include: tying in the property description to known local attractions and/or event. One tip to remember: Don’t come to the guests. Let the guests come to you.
Encourage the guests to share their experience while staying in your Airbnb property. As a popular saying goes: “The word of mouth is one of the best advertisements there is.” Take advantage of it by requesting your guests to write about their Airbnb adventures. Having a good review written about your Airbnb property proves to be a strong link in terms of getting more bookings.
Hire a credible SEO (Search Engine Optimization) expert. No matter how good an Airbnb property host is, there are times when his knowledge can only go so far. This is where the services of an SEO expert come in handy. Aside from boosting the views when it comes to property listings, this particular service is also helpful in getting the potential Airbnb guests to notice and book a specific property. This, in turn, leads to additional income for the latter. Final verdict: The benefits of hiring an SEO service far outweigh its accompanying costs. SEO services are definitely a valuable weapon in a property host’s arsenal when it comes to getting their listings noticed and booking guests.