Airbnb is a ground breaking, modern way to share your home and earn extra income. Founded in 2018, Airbnb has disrupted multiple industries bringing with it a long list of success stories across 191 countries from those who have managed to use it to their advantage.
Airbnb currently has over 5.6 million listings and 150 million global users with a lot of short-term Landlords and amateur hoteliers attempting to be a part of Airbnb’s rapid growth.
But the question you’re probably asking is how do I earn extra income from listing my property on Airbnb? We’re here to hopefully answer that question and show you some of the clear benefits & advantages of starting an Airbnb business.
So without further ado, let’s dive into the blog!
Registering with Airbnb.
First things first, to get started, you’ll need to register your property with Airbnb. Fortunately, this process is super simple.
All you need to do is take a few snaps of your property and write a description which best describes your property. Once accomplished, it’ll be sent off for review by a member of Airbnb’s team before being listed on their site.
What should I put in my description?
When listing your property with Airbnb, you’ll want to make sure you make your property sound as attractive as you possibly can. We recommend that you put on your best writer’s cap and make your property sound truly unique in order to attract as much attention as you can get.
Understanding who your customers might be will also help you here, as you can craft the description to be less generic and give the features of the property that you know your audience would like a larger spotlight.
Understanding the Fees.
The second step to starting an Airbnb business is to understand the fees you might encounter.
Not only is this necessary, it’ll also serve to your advantage in the longer term. By understanding the fees, you’ll be able to adjust your pricing to account for profit that could otherwise be lost.
So, let’s look at the fees you might face.
Hosting Fees
Hosting fees, in short, are fees that are specifically set out by the host.
You’ll find that these fees can vary depending on the booking. Here’s a few examples of what these fees might cover…
- Cleaning Fees
- Security Deposits
- Extra Guest Fees
Airbnb Fees
Airbnb’s fees are typically fixed percentages of the final booking costs. These service costs can range from 10-20% on top of the 3% of the final pay Airbnb takes.
However, as of December 2020, Airbnb recently released the option for its users to choose between 2 types of pricing known as Split Fee & Simplified Pricing:
- Split fee pricing is the traditional way Airbnb operates. Hosts typically pay 3% of the final payout on top of a service charge that varies between 10-20%.
- Simplified pricing removes visible service fees from the guest’s perspective and instead, Airbnb takes 15% of the final payout. This gives the guests full control over the final price that the guest has to pay.
Which fee model should I choose?
First of all, not everyone is able to choose! If you live in the following countries, you’ll be able to freely select which fee model you’d like…
- United States, Canada, Mexico, Bahamas, Argentina, Taiwan, Uruguay
If you live outside of the countries listed above and you have traditional hospitality listings on Airbnb, you’ll be forced to use the simplified pricing model by default.
We recommend comparing the perks of each fee model.
Simplified pricing makes your listing look more expensive as it compiles the hosting fees, Airbnb fees and the nightly rates into one price.
Traditional pricing makes your listing look cheaper however it doesn’t include the hosting fees & Airbnb service charges.
So have a look at the pricing in more depth to figure out which fee model might be more applicable for you!
Airbnb Security Requirements
When starting an Airbnb business, you might also be subject to additional security checks depending on how high your listing scores against Airbnb’s risk scoring algorithm.
Airbnb has pretty sturdy security systems in place to prevent criminal, terrorist or fraudulent activity – sometimes it can throw up false flags – however, it’s pretty easy to get your listing back in place should something like this happen.
They have a few other security systems in place too. If you’re based in the United States, you’ll be subject to a background check before you’re able to successfully list your property on Airbnb’s marketplace.
Laws & Licensing
It’s crucial to check before you try to list your property on Airbnb that you have (if needed) the right license in place and are compliant with the law throughout. For example, some places in the United Kingdom require the host to get a license first.
In order to understand more, we recommend you check Airbnb’s responsible hosting page which’ll inform you what kind of licensing you may require depending on where you live and the law surrounding Airbnb hosting.
Managing Your Airbnb
There are a few ways to effectively manage your AirBnb which we recommend. Here’s a few to note:
Find Reliable Cleaners
We recommend sourcing a great cleaning company who can actively keep up with your AirBnb’s needs. Cleaning can be quite a menial task, so if you aren’t up to the job yourself, we recommend outsourcing it!
Install Smart Locks
Another great tip that we stand behind. Installing smart locks is a great idea to make key handover super easy. A smart lock can be managed remotely and guests can arrive at any given time, so being able to grant them access to the property without being there is a massive plus!
Use the Right Tools
Surprisingly, a large quantity of property managers, owners and investors still rely on spreadsheets. We don’t recommend this, as they’re (more often than not) prone to crashing, corruption and are extremely feature limited.
Start your Airbnb business the right way by using reliable Property Management Software and you’ll be able to effectively scale the number of properties and tenants with ease.
