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Airbnb is a profitable marketplace, where people who want to rent out properties they own can connect with people looking for accommodation in particular locations, especially in select cities like London and Manchester. Whatever your financial position, there are multiple ways to make money from the platform. SevenStays takes a look at how you can start an Airbnb, and rent on other platforms like booking.com or HomeAway, when you have limited funds.
Do you own a property that you don’t always stay in? You could use this for an Airbnb rental. Before you prepare your property for the short term lets market, however, you will need to make sure that there is tourist (or business travel) demand in your local area, and that you can legally run your Airbnb.
Once those two boxes are ticked, arrange your home so that it is attractive to your prospective Airbnb guests. Remember that a property decorated as a home for yourself might not be ideal for the Airbnb letting market. A professional management service like SevenStays, or its long let counterpart SevenLiving, can advise you on your property’s suitability, based on the features that it has, and whether you would have success in the holiday let market.
You may need to redecorate, install new furnishing, and/or re-arrange the layout of your space. You will also need good quality photographs, preferably professional photography, for the Airbnb listing.
Different properties attract different types of guests, so make sure that you are clear about what kind of property you are letting, so that guests’ expectations are met when they arrive. Otherwise, you risk receiving negative reviews. A family with young children may be looking for a different style of property than a single student.
Last but not least, make sure that you’re up to date with Airbnb’s rules for owners, so you can make the most of your vacant space. Running an Airbnb business involves juggling many different tasks, including optimising your property, advertising your listing on Airbnb, setting a pricing strategy, and providing a first rate experience for guests, which is why it’s advisable to enlist a professional host management agency like SevenStays. This is particularly the case as touristic and business guest demand fluctuates due to season, e.g. summer for holiday lets, and multiple other factors (local events, weather, economic climate). As such, your price will need to change with the calendar to maximise revenue, and it can really help to have an expert recommendation.
If you don’t have a lot of money, and don’t actually own a property, then the Airbnb Arbitrage option could be of interest. Airbnb Arbitrage enables you to earn money, even if you don’t own a property. It’s a hosting management model which involves renting a property, with the intention of subletting it on vacation letting sites. You can request that a landlord lets you a house, which you then sublet as a short term rental on letting platforms. Rental Arbitrage can be profitable if your earnings from subletting are higher than the cost of renting and your other expenses as host (e.g. cleaning and repair fees).
Before you go down this route, read up on the legal regulations – subletting is illegal in some locales. The landlord must give consent before you attempt to sublease any of their property. In many long-term lease contracts, tenants are not permitted to sub-let their properties – so make sure you don’t fall foul of the obligations of your lease.
Being a property manager is relatively low risk if you know how to run your business properly. You’ll need to do some thorough research on the vacation rental industry, and demonstrate that you’re capable of running a property management service. Many guests expect a hotel -like service, or a professional serviced apartment style experience. It will be crucial to stay on top of property maintenance,
Once you’ve done the groundwork, you’ll need to find clients – several hosts who are interested in hiring your property management service. You will be responsible for managing the owner’s property on their behalf, and not for paying maintenance. Your obligations will include the following:
Your earrings will depend on the percentage of the property owner’s rental fee that you set aside (typically between 10 to 40%). You’ll need to decide on fees for guests, according to the location and the services you offer.
However, be aware that property management is not as simple and breezy as many guides suggest. With the high guest turnover, you’ll need to arrange inspections of the property after each guest leaves, and hire a professional cleaner ahead of the next guest.
In SevenStays’ experience of managing thousands of bookings, we understand how to maximise earnings from Airbnb – and it isn’t as straightforward as it seems at first blush!
This is another option if you don’t own a property that you can rent out. Airbnb Experiences involve providing experiences for guests, such as tours, high-end excursions to historic or interesting locations, or other experiences. You can include any activity or event that tourists are likely to be interested in as an Experience. You then need to complete an application to Airbnb, as your Experience will need to be vetted by them. The platform will provide feedback, usually within a week. You’re then free to register as a business, or obtain a licence, if your service complies with local regulations.
The Airbnb Affiliate program allows prospective shots to earn money by referring others to the platform. You refer people to Airbnb and help them to create an account and book their first stay, in return for commission if they tell others that you were the one who referred them to Airbnb. Affiliates who earn from this scheme use an affiliate link and a well-devised marketing strategy in persuading people to sign up with Airbnb.
There may be open rental properties in your area that you can capitalise on – you just need to approach the property owner and ask for their consent. Some property owners won’t be willing to invest extra time in Airbnb, but others may be. You need to persuade them that you’ll save them time and stress by listing their property as a short let on Airbnb, and moreover, that it’s more profitable than long-term renting.
An Airbnb co-host is someone whose role is to manage one or multiple listings, and to maintain the property for the Airbnb host.
If you partner with a host, you will need to confirm bookings, handle guest communications, oversee the check-in and check-out process, replenish amenities like cleaning products, and inspect properties.
There are several advantages to co-hosting. Firstly, you don’t need a licence to become one; secondly, the working hours can be more flexible, and you earn 10-20% of each booking, though there is potential to earn up to 25% if you manage the entire process.
Any concerns about renting your property as a short stay rental or holiday let? SevenStays can find a solution for you – whether it’s getting your cottage or apartment to look pristine for a stellar Airbnb listing, advising on price, or for any other information, our specialist team is always at hand.
The SevenStays Blog is a great place to get to grips with the world of airbnb hosting, and the support that we offer. Check out our latest blogs below, or for more advice why not take a look at the entire archive?