How to Become Financially Independent with Airbnb
Financial independence is a goal that many people dream of, but nearly as many don't know how to achieve it. Passive income is one way to help you reach this goal, and short-term rental platforms like Airbnb are one of the best ways to create that passive income.
In this blog post, we'll show you how, with some up-front work, careful thought, and persistence, you can develop a solid passive income stream and use Airbnb to help achieve your dreams of financial independence!
Airbnb Earnings Potential
First off, you should have a realistic idea of how much a typical Airbnb host makes. For many folks, making money through vacation rental properties is a side hustle rather than a main gig.
However, with the average US host earning a total of $44,235 per year (with hosts in states like Hawaii, Tennessee, and Arizona making over $60,000 per year on average), it's definitely possible to use Airbnb to create a solid stream of passive income. Your Airbnb earning potential will vary based on several different factors, including the size of the apartment or home you rent out, the amenities you offer, how often you can rent the space out to guests, and local competition.
You should also expect to get out of Airbnb what you put into it. If you aren't willing to work extra hours to furnish, stage, clean, and maintain a vacation rental home, it's unreasonable to expect to earn a full-time income. However, if you put some time, money, and elbow grease into your property at the start, you can build a reliable second income.
The more effort you put into creating a comfortable space and providing an excellent guest experience, the likelier you'll be to generate positive reviews and ratings, which in turn will increase your chances of scoring profitable bookings time and time again.
Picking the Right Property
Obviously, you can't be an Airbnb host if you don't have a property to rent out to guests. If you already own a home, you can find times that your house won't be in use (such as when you're on vacation or out of town for a three-day weekend) and start listing your property on Airbnb.
If you have enough capital to invest in an additional property, you can scout out units found near locations that see a lot of tourism and, thus, a high demand for short-term rental (STR) accommodations. So much the better if you already live in such a city and can find an available property nearby.
But what if you don't currently own a property you can rent out?
In case you're renting your current house or apartment, reach out to your landlord and find out if subletting your residence as a short-term rental property is permissible under your current lease agreement. If so, you can move toward renting out your space when not in use. If not, consider finding a new place to rent with greater leniency toward Airbnb subletting.
However, you go about it–finding the right property means finding an attractive residence located near popular destinations, mainly if the property is centrally located and gives guests access to major roads and highways. The right property will also be large enough to accommodate guests without them feeling cramped or short on space.
Just make sure to check any local zoning laws or other regulations that may potentially govern how you use your property for vacation rental purposes. As long as you follow these rules, you shouldn't have any trouble with maintaining legal compliance.
Managing Your STR Property Well
Your vacation rental home is a property like any other, and that means that part of succeeding through your short-term rental house is maintaining that property well. Housekeeping and cleaning are musts, especially between bookings and right before guest check-in.
Keeping your vacation home spotless for incoming guests and well-maintained via regular maintenance inspections and upkeep will reduce the chances of an issue arising (such as a clogged drain, hit-or-miss A/C unit, or faulty water heater) while guests are checked in.
At best, poor maintenance could lead to guest complaints and poor ratings or reviews. At worst, home issues that crop up due to a lack of maintenance upkeep could pose a safety hazard to guests.
Outsourcing these vital cleaning and handyman tasks to an AirBnb Management company is what keeps the upkeep of your STR property from becoming a second job. Hiring someone to perform these fixes (or working with a property management company that does so) saves you time and allows you to remain flexible while earning extra income through your Airbnb hosting.
Organize Your Airbnb Business
Organization is an essential part of any enterprise, and an Airbnb business is no different. Once you've found the ideal rental property and determined how you will keep it clean and maintained for your future guests, you need to create an organized system.
You'll need to market your Airbnb listing, keep track of bookings, and manage guest inquiries and questions as they come in. With so many pieces to juggle during the entire short-term rental process, you simply must have a transparent task management system in place before your first guest ever checks in.
Airbnb provides resources of its own, such as its online guides and instructional videos. You can also work with a property management professional who can lend years of expertise when it comes to managing and organizing a thriving Airbnb business.
How to Automate Your Airbnb Business
Automation is another essential part of using Airbnb for your greater financial independence. Remember, we aren't talking about leaving your current job so you can do Airbnb full-time. You'll need to put a lot of high-level thinking and work into your Airbnb setup at first, but once you've started earning income through a few different properties, you should consider automating your processes.
Automated tools allow you to use less time and effort to run your Airbnb business. For example, managing cleaning schedules for more than one vacation rental property is tedious and leaves plenty of room for error. However, certain apps allow you to automate your cleaning schedules, keeping everything in order so that you never fail to clean a unit before guests check-in.
Speaking of the check-in process–some apps automate guest entry by generating a temporary access keycode to your property. Once a given guest's stay has ended, the access code expires, which gives them convenient access during their stay while keeping your property secure the rest of the time, all without you batting an eye!
You can also use apps that automate check-in and check-out communication (including providing check-in instructions and answers to guest questions such as how to use the amenities and appliances in the vacation home), communication with any cleaning staff, and dynamic pricing.
The better you get at using automation tools or otherwise outsourcing your Airbnb property management, the more passive your income becomes, and the better you can scale your business for higher profits without a correspondingly bigger headache!
Bring in a Co-Host
Time is always a key factor when running a side hustle like Airbnb. One of the ways you can run multiple short-term rental properties without sacrificing all of your time and energy is through enlisting a co-host.
An Airbnb co-host assists with check-ins/check-outs, concierge services and guest communication, maintenance tasks, and more. They are an experienced Airbnb host who can not only help you complete tasks but also share unique insights, maximize the reach of your assorted property listings, and provide each guest with a five-star-worthy experience.
Collaborating with a co-host enables you to advance and manage your Airbnb business without needing to oversee every single detail yourself. Once again, it's about increasing the "passive" in "passive income."
Offer Both Long-Term and Short-Term Rental Opportunities
Airbnb focuses on short-term rental opportunities, which can undoubtedly be quite lucrative. However, consider offering long-term rentals to increase your income stream further. Short-term rental bookings are great for grossing more money during peak vacation season, while long-term rentals give you the chance to continue earning reliably during quieter parts of the year.
On top of the consistency benefits, hosting long-term guests also lowers your cleanings and maintenance expenses (i.e., you or your housekeeping staff don't need to clean and perform upkeep between as many bookings) while minimizing your guest turnover and improving your occupancy rate.
Combining short-term and long-term vacation rentals can help you get the biggest bang for your buck all year long.
Contact Us Today!
Want to achieve financial independence with your Airbnb business? Contact the team at Vello to learn how our expertise in listing optimization, concierge services, and property management can put your life on the path to financial freedom today!
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