How to Scale Your Airbnb Business in Houston, TX

So you've purchased, cleaned up, listed, and scored some five-star reviews for your first Airbnb property in Houston. Congratulations!

But perhaps after getting a taste of success in the short-term rental (STR) market, you've become hungry for more than what a single property can offer. At this point, the best way to increase your passive income stream through the vacation rental market is by scaling up your Airbnb business.

Let's explore how to do just that!

Growing Your Airbnb Business: The "Why"

If you're feeling comfortable with the amount of success that your Airbnb business has enjoyed so far, you might be wondering what's the big deal about scaling up your enterprise.

In short, the biggest reason to scale up your business is to give you the opportunity to earn more revenue with less time, effort, and work over the long haul. Once you own and start receiving rent from multiple vacation properties, it will become easier to outsource your process and implement systems that lead to a more hands-off approach to Airbnb earnings.

On top of that, the time is right to lean into the short-term rental market, which is currently projected to grow in demand by almost 11% year-over-year going into 2024.

Whether you're looking to make a living through online vacation rental property or just want to make another smart addition to your rental management property portfolio, this is the moment to start scaling things up for bigger earnings.

Growing Your Airbnb Business: The "How"

"Okay," you're thinking, "so you've convinced me to grow and develop my Airbnb business. But how exactly do I go about doing that?"

We'll get into a lot of the nitty-gritty of Airbnb business expansion in the steps listed below, but you should start by preparing yourself mentally for the initial challenges that can come with scaling up any enterprise. Take stock of your situation and ask yourself the following questions:

Do I currently have the extra mental RAM and bandwidth required for a business expansion? Am I ready to start thinking outside the box? Am I prepared to spend some elbow grease to track down, buy, prepare, and list the numerous properties that I'll need to scale up my business?

If you come through this self-examination feeling confident in your abilities, then you can take that positive attitude onto the next step.

Do some financial legwork to assess your capital for purchasing your next vacation property (leaving yourself enough surplus to handle unexpected expenses) and project how much you can reasonably expect to make on whatever house or condo you're eyeing.

Write down realistic goals and expectations for your business expansion, such as your expected cash flow and desired profit margins. Having written goals and an action plan will help guide your ship as you navigate these uncharted waters.

Maximizing Local Potential

Assuming that your first Airbnb property is already located within a major metropolitan area, you'll want the next few investment properties to be located within that same city or region.

Having a cluster of properties in one area will make it easier for you to physically manage each of your rental homes, especially since you won't have to drive as far when performing day-to-day tasks such as cleaning, maintenance, and stocking the property.

In addition, having all of your starter properties located near each other will simplify obtaining services such as cleaning and maintenance, potentially even letting you bundle these services together to create cost savings. For more information about managing multiple short term rental properties in Houston, you can contact us. 

Finally, grouping your first half-dozen or so properties lets you get a feel for your local market, including the most profitable days of the week, the busiest seasons for tourism, and the best neighborhoods for investing. Possessing this wealth of local knowledge will give you a leg up compared to out-of-town vacation rental property investors.

Branching Out into Other Markets

Of course, to truly scale up your business, you probably won't be able to stay in the Houston market forever. After you've reached the cap on the number of local properties you want to run in your area, you can start reaching out to neighboring towns and regions.

Use the local knowledge you've obtained throughout your previous enterprises to find the best nearby locality to invest in, as well as which neighborhoods within that city or township to focus on. Get your hands on as much market data as you can manage to find the ideal property for breaking into this new market.

After securing and listing your first out-of-town short-term rental property, hold off on buying any more properties until you've had a chance to develop this one. Run it for about one economic quarter, or until you can turn a profit on it (whichever comes first).

Once you're confident that you can run a successful out-of-town property without losing sight of your other investments, you can start slowly researching additional properties to acquire in other non-local markets.

Building an Efficient Team

As your business and property count grow, they will eventually become too big for you to handle independently. This doesn't mean you need to hire a dozen staff members, but it does mean you should be willing to hire a new team member as the need arises.

The people you consider your team members don't all necessarily have to be direct employers, either. By hiring a vacation rental management business, recruiting a local cleaning crew, or locating co-hosts to help with your additional rental homes, you can expand your efforts while still turning a nice profit.

You can also minimize your need for in-house staffers by keeping your operation efficient. Simplify guest verification and check-in through keyless entries, and use automated property management software to track tasks and bookings. With the right technology, you can run your everything from a single hub without needing to hire a large staff.

Employing Short-Term Rental Automation

Speaking of automation, making use of the latest in property management technology can save you from a lot of headaches as you scale up your business. STR automation software and applications can keep your team from dropping the ball when it comes to managing listings, creating a positive guest experience, and keeping each of your properties in tip-top shape.

For example, making use of a pricing automation tool allows you to create a dynamic pricing strategy that matches the rates of each of your properties with the seasonal demands of their respective locales. This will help you continue to secure quality guest bookings without losing out on profits by pricing too cheaply.

You can also use guest management software to automate contact with visitors, allowing you to effortlessly initiate guest communications, provide timely responses to guests during their stay, and prompt them for a positive review after their stay. This will create a smooth, pleasant experience for guests that will increase the likelihood of positive guest reviews, which will further boost the rankings of your listings.

It's even possible to automate the turnover cleaning process for each of your STR properties, meaning that you can rest easy knowing that your contracted cleaning team will be on the job in time to set the home up before your next booking.

Track Your Performance

As you get the ball rolling on your expanding Airbnb business, you'll need to keep track of how well your properties are actually doing. The old saying attributed to business expert Peter Drucker is that "What gets measured gets managed," meaning that you can best run those aspects of an enterprise that are genuinely being measured.

When it comes to the property management industry, there are plenty of key performance indicators (KPIs) that property owners like you can track. Being smart about which ones to track will help you make smart property decisions rather than acting on incomplete information.

Some of the most important metrics include your occupancy rate (total number of booked days divided by total number of available days, multiplied by 100 to create a percentage), average daily rate (earnings potential apart from operating costs), average stay rate (longer is often better!), and guest satisfaction (your average rating out of five stars).

Contact Us Today!

Are you ready to make your first big expansion and start expanding your Airbnb business into the stratosphere? Then you need some experienced Airbnb property managers to give you a hand!Contact the vacation rental pros at Vello to learn how much our property management business experts can do for you!

If you have any questions feel free to ask

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