Listing your home on Airbnb can be a lucrative endeavor. After all, the travel industry is massive: millennials alone are expected to spend $1.4 trillion on travel by the end of 2020. Even more: according to data, the current global vacation rental market is predicted to grow by 7.07% every year until 2021. And Airbnb plays a major role in this industry.
Currently, the average annual revenue for individuals who list their homes on Airbnb hovers around the $20,000 mark. And believe it or not, 87% of listers put up their primary residences for rent, making it a viable option for people concerned about giving up their homes during rental periods.
However, before you jump to list your home on Airbnb, there are some crucial things you should know. Understanding laws and marketing can help you not only stay within the legal confines of your state, but perform well on the platform and generate an additional revenue stream. Here’s what you should know:
Your Price Will Make or Break You
How you set your pricing could mean the difference between scoring a renter and missing a lucrative opportunity. And pricing too high or too low can both cause some issues. Although Airbnb will offer pricing suggestions based on similar rentals in your area, you should do some manual research on your own by scouring listings. This will also give you an idea what homes are getting great reviews, what amenities they’re offering, and how they’re using text to attract their target markets. When you analyze your competition for pricing, pay particular attention to properties that have already garnered a handful of reviews, as newer properties might price their homes lower to attract initial visitors.
Know Your Local Laws
Understanding local laws can prevent you from facing disastrous issues and costly fines and lawsuits later down the road. Airbnb does a great job of communicating local laws to listers based on their geographic location, but it’s important you remain well-read yourself, especially when there’s a bit of a grey area in the mix.
For example, the city of San Diego passed a regulation that forbid homeowners from renting their homes, but this decision was quickly overturned thanks to swift efforts from Airbnb and its supporters.
However, understanding local laws is especially important for people who don’t own the properties that rent. Many landlords incorporate a clause in the lease the forbids renters from renting their property on short term rental sites like Airbnb.
Talk to Your Landlord About Permission
Pay attention to your lease, and if you feel inclined to make changes, be transparent with your landlord. Make them feel more comfortable with your proposition by showing them proof of business or renter insurance, as well as proof of successful previous rentals if possible. If you’ve known your landlord for a while, you’re already on a good negotiation side, as trust has been built up. But there are other perks you can offer that might ease them up on the idea.
For example, you might want to pay for your own professional runthrough of the house. “Let’s say your lights were flickering from time to time or not lit as brightly as they should be,” says Passion Electric, an electrician in OKC. “You might need an electrical panel upgrade or have some faulty wiring.” Offering to take on these tasks puts you in a favorable bargaining position. You could also offer to do some additional work on the property, thereby increasing the value of the home, or guaranteeing a lease extension.
Put on Your Customer Service Hat
Listing your property on Airbnb is akin to being a business owner. You’ll need to answer questions from potential customers and keep them satisfied throughout the duration of your stay. Understand that with this comes a time commitment and passion for hospitality. If you don’t have the time to always help your guests check in and check out, or to manage your reservations and requests with ease, consider getting help from friends and family or hiring an Airbnb management service team to handle the hard work for you. You can use a self check-in lock to allow guests to check in without your help at various hours. In this case, be sure to create a Welcome Guide that offers them details on your home and local area.