A lot of people use Airbnb merely to supplement their household budget, but the problem with this mindset is that it limits the otherwise limitless potential of this business model. You don’t have to settle with one property or an occasional visitor that you’re “lucky” to get per month. Instead, your Airbnb business can be so much more.
Now, even if you’re currently subletting a part of your home, one’s always allowed to dream. The goal of this post is to show you how, with the right plan, you could quickly improve your game and create a small rental empire using this platform.
- Diversify your offer
Even if you have a few rental places that you can list on Airbnb, you need to understand that a large portion of your audience doesn’t want an entire place to themselves. Private rooms are cheaper, and for someone just looking to crash into a place for as cheap as possible, this is the ideal alternative.
The problem with this is the mindset. After all, the majority of people are subletting rooms in their own homes. They’re subletting the extra space that they have. If they had an extra apartment and decided against finding a permanent tenant, they would list an entire apartment.
Why not rent out individual rooms instead? The increase in the demand for this accommodation type is stellar.
In fact, if you have several rental properties that you intend to rent out on Airbnb, you could start by listing one as split into personal rooms and all the rest the standard way (the way you originally intended). Then, if the first turns out to be a success, you could change the listing for a few others.
- Get some help
The next thing you need to understand is that while Airbnb was made to help you do it all on your own, this only works if you’re subletting a room in your home or your home for a weekend. If you intend to run it as a business, you need all the help you can get.
First, you need to find a property manager. The problem is that these specialists are expensive and hard to come by, which is why you’ll have to be extra crafty about it.
As a cheaper alternative, you could hire a virtual assistant. This is a personal assistant working remotely. They’re capable of handling the majority of your administrative tasks, helping you with listings, and more.
You can even find an assistant specializing in real estate.
Remember, you’ll be overburdened with work, and you need all the help you can get. They could, for instance, help you with research. They can check out other Airbnb offers and see what they’re doing, better or worse. Just checking if your offer is competitive, and tweaking it a bit could make a difference.
- Think about marketing
The biggest bane of any Airbnb business (and anyone renting the property) is a vacancy.
You see, apartments and houses have utilities, property taxes, etc., regardless of whether anyone lives there or not. Naturally, you’ll pay less if the utilities are not used, but you’ll still pay something, and you won’t have any profit to show for it.
With the right marketing, promoting your property, and employing a few advanced strategies, you should be able to get what you’re looking for.
- First of all, you need to ensure that you make your booking easy.
- Second, you need to focus on getting great reviews.
- Third, when making a description, place a special emphasis on your area.
- Lastly, make sure that all the photos that you use are high-quality.
Most importantly, you want to establish a strong social media presence, perhaps even find influencers (even micro-influencers) to endorse you.
With the right digital platforms, you can even automate most of your marketing efforts and make them much more effective.
- Do the math
Previously, we’ve mentioned the fact that a lot of people just sublet a part of their home, which makes the calculations so simple. You really don’t have too many expenses since the utilities won’t go that high because you had an extra resident for a few days of the month.
However, what happens when you run a business? With conventional residential properties doing math and figuring out the break-even point, the ROI is rather simple. After all, you’re looking for a place that will return 1-2% of its total value every month. With Airbnb, it’s not so simple.
On paper, the rent is higher (if you were to have occupants every day of the month). The problem is that ensuring low vacancy is never easy. Sure, with good marketing, it’s a lot simpler, but there’s still no guarantee.
The best way to approach this issue would be to engage in a three-point estimation. Here, you try to estimate the best-case scenario, the worst-case scenario, and the most likely scenario (usually somewhere near an average, median, or based on previous months).
- Develop a network of contacts
You need to manage this property to the best of your abilities. This, however, means developing a reliable network of contacts.
You need to have plumbers, electricians, general contractors, painters, and movers on demand. Not all tenants are as considerate, and some just need a base that they’ll use while on a binge tour. This means that you’ll have broken furniture and wine stains on your walls far more often than you think.
Even if you do manage to charge them for this, the damage still needs to be fixed. This is why having all these people on speed dial is so important.
Most importantly, you need to have reliable cleaners. Some cleaning agencies specialize in Airbnb properties but if you don’t have any specialists in your area, even reliable generalists will do.
Wrap up
Ultimately, whether or not you treat your Airbnb potential as a business opportunity is completely up to you. If you do, you need to set up an organization. This means that you need some help, you need a business plan, and you need a network of contacts. With these three things on your side, you’ll be unstoppable.
