With 81,000 cities worldwide and over 5 million places to stay, AirBnb has become the new alternative to expensive hotels. Rather than staying in a sterile hotel with stiff sheets on your vacation, you can stay in a full home and feel like you’re, well, right at home!
But what about owning an AirBnb property? Here are the basics of being an AirBnb host today.
The Best Part
Owning your own separate AirBnb property rather than just renting out your own home means you can rent it out all the time. Whereas if you were just renting out your own home, you would probably only make it available for rent when you were out of town. This means you can have a continuous stream of income all month long.
Overcoming Legal Regulations
Some cities have imposed strict regulations on AirBnb rentals. You may be restricted on how many days out of the month you’re permitted to rent out your property or city-zoning laws may confine short-term rentals to specific neighborhoods. These are important to investigate before choosing and purchasing a property intended for these purposes.
According to the IRS tax code, you are not permitted to keep a property for personal use and still get tax write-offs. This means you either have to continually rent the property out or you lose out on some money. You can’t live there and still get tax breaks. Consider that before committing to being an AirBnb host.
Setting the Rent
Another advantage of owning an AirBnb rental? You set the price. As the lister of the property, you get to determine how much you think others will be willing to pay to stay at your listing. If you set it too high, you might not get any guests but if you set the price too low, you might not make enough money to pay for the property. Be reasonable and try to base your prices off of similar properties in your area.
Hidden Expenses
While you might assume that the price of the home is the major obstacle between you and your AirBnb, there are a lot of hidden price tags that you might not be aware of. In between each rental, you’ll need to hire a cleaning service to take care of the home and clean up after the previous guest. Don’t forget about your utility bills! This is still just a home and you’ll need to pay to keep on the heat, lights, and water.
AirBnb also takes a 3% service fee from each rental which can chip away at your profits. Consider these things before setting your prices.
While tough to manage, an AirBnb host can stand to profit off of their property. If you’re willing to manage all of these obstacles and more, an AirBnb property may be a solid investment for you.
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