Investing in Airbnb rentals is a great way for investors to expand their businesses and increase their profit opportunities. Renting out an investment property on Airbnb isn’t a strategy suited for everyone, but those who choose to pursue this option, often reap the rewards.
Choosing to rent a property through Airbnb isn’t without risk and it does bring its own unique challenges and expenses. However, many of the most common frustrations property owners face can be alleviated by choosing to host on the home-sharing platform, versus renting your property out to a single tenant or family.
If your property is in an exciting or central location — such as a metropolitan downtown area, near a vacation destination, or close to a stadium or large attraction — you have the opportunity to catch the eye of short- and long-term travelers. Plus, finding someone who wants to stay at your property for a few days is typically much easier than finding a tenant to sign a year-long lease.
Airbnb also offers investors a way to market their properties to an audience that might not have otherwise had their attention. Properties found through the platform (which now includes a mobile app) are being rented by an average of 2 million people per night around the world, and Airbnb offers these travelers an easy way to find exactly what they need (ideally, your property) within the area in which they need it.
Finally, Airbnb facilitates the everyday nitty-gritty of the property rental process. The platform vets renters, accepts payments on your behalf, allows for an availability calendar, and even gives you and your renter(s) a way to rate the experience from both sides. You can
communicate with renters through Airbnb, too, as well as notify them of additional charges that you require — such as a cleaning fee, pet fee, and the like.
If your renter leaves your property trashed or even damaged, you have recourse through Airbnb. Their host guarantee offers up to $1 million in property damage protection and compensation for property owners.
The Bottom Line
When considering an investment property, there are many different types to choose from; if you’re going the residential route, you can also choose between a traditional rental and home-sharing through a platform like Airbnb.
Airbnb has had an incredible impact on property investing since its introduction a decade ago. The platform not only gives investors another way to monetize their existing and future properties, but also expands the ease with which they are able to find renters and turn a profit.
Of course, home-shared properties aren’t for everyone, and they aren’t even for every property. It’s important to take an honest look at your preferred style of property management, as well as analyze whether your home would be a good fit for a platform like Airbnb. While Airbnb has made it easier than ever to market and monetize your property, you may find that traditional property investing is actually the better choice for you.
At First Equity Funding, we focus solely on asset-based lending to real estate investors looking to buy or fix up residential properties in over 40 states throughout the US. Interested in learning more about us? Contact First Equity to get FUNDED today!