After all the work and maintenance is it profitable?

I’m a potential new host and I’ m debating between an Airbnb hosting endeavor or just rent my apartment to a local in a long term rental.
Any comments?

It’s depend your location and place.

We are at *3-*4 compare to a long term rental

I am thinking about gradually have more long term tenants than airbnb guests. But 50% 50%
Long term tenants less work, stable income, low stress but low profit too

Airbnb you just need to rent your weekend out then it’s already same as weekly rental you can get from long term tenants. But when you have many many apartment it is very hard to manage. A lot of cleaning cost and time consuming.spend long time on your listings everyday too. Sometimes is not worth the stress when some of the listing is not too profitable. For example one of my 3 bedroom apartment only makes $500-800 a week, which is too much stress to keep it because after cleaning and time consuming it will be almost same same long term tenants.

So I am thinking during the low season I get long term tenants, high season do airbnb. So low season I can travel

It is profitable IF you AND AirBnB put in the effort and resources. In my situation it has been great until recently. Location has plenty of visitors. I’ve dedicated myself to hosting as a full time job. The drawback in my opinion is AirBnB has become too big too fast and the platform is failing me. There is no host screening which allows anyone and everyone to jump onto the service that wants to make a quick buck. The platform is flooded with listing sucking up potential guests that somewhat take a gamble on new listings. Additionally, the customer support has resorted to giving guests and hosts canned apologies when the system fails making it very frust rating when they are sent from person to person passing the buck trying to appease everyone that they can not possibly support. Check out all the tweets at airbnbhelp as well as comments on every one of their facebook posts. All people just trying to get the attention of customer service. Just my opinion, but I would take this into consideration before you make the jump into hosting.

3 Likes

I agree we are making good money because of some other platforms. To much concurence with Air bnb

I think you should do long-term rentals. Airbnb is about hosting, not just making money. Ok… it really is just about making money but you need to have the kool-aid attitude if you want to be successful at it. Your short, but succinct, post suggests that it may not be for you.

2 Likes

usually it is not because most places are horribly underpriced in the race to the bottom

It all depends on your financial strategy. Like other have stated in this thread you have to account for your time, consider slow season, etc.

Depends where you are … if you’re in a part of the world where there is legislation governing STR activity then that may have an impact on whether it will work for you too. In London the maximum you could let the house out for would be 90 days of the year. For most Londoners listing whole properties they are now going to have to change their economic strategy.

So how do you propose Airbnb go about eliminating your competition?

As it stands now, everyone has access to the platform to list their place and make money. Whether or not guests choose your place depends on the usual: price, value, reviews. People don’t care if you’re making a fast buck or a slow buck. If you want more business, you have to be better than the others.

Thank you guys
That was very helpful
I see that some of you have extensive experience and I appreciate your unselfish guidance.

No doubt the ‘sharing economy’ is as close to a pure capitalistic competitive model as you can find today.

@javy2915 Lately, I have talked to many people in my area, and maybe 25% are switching back to LTR after experiencing the STR model. Then again, what is odd, because so many went to STRs, now LTRs are more profitable then in the past.

1 Like

For an entire place listing which you are going to have to furnish from scratch, if you are going into Airbnb the benefits come in the long term.

In my case when I factor in cost of furnishing which you incur at the front end, and the monthly overhead (utilities, etc) which I would not be paying if I were renting to long term tenant unfurnished, then I will not be making any more than if I had rent unfurnished to a long term tenant until about a year into the operation.

This is because whatever I am making on top of what I would’ve been making had I been renting, goes towards recouping the costs of furnishing, plus the monthly utilities!

So I’d say, if you’re willing to play the long term game, and put a lot of time and effort into it, go for it.

If not, just rent to a tenant and you get deposit and start earning immediately without bearing large expenses up front.

Did you mean short term game,…?
Good point on utilities, etc.

“kool-aid attitude” - oh, man that is going to keep me going over many a rough spots in the future! Screaming kid? “Hey, ok, I got a kooool-aid attituuude”. Guests slamming the bathroom door? Kook-aid attitude to the rescue!

I think I’m raspberry kool-aid attitude…

While that’s true, I think @Dwylene’s point is that it makes it harder to be profitable, even if you are better than others. When the market is flooded and competition becomes fierce, prices drop. In addition, people who don’t realize they have issues with ho insurance, taxes, etc., jump in at a low price not understanding the expense. So hosts who have invested and continue to invest in being professional and offering a great value still suffer because they can’t charge what they are worth because they are being severely undercut on all sides.

Personally I’m hoping that people will realize the work involved and the narrow (in some places) profit margin and prices will stabilize. My neighbor is talking about how she’s finishing her basement to rent on airbnb in one breath and in the next breath exclaiming how she’s always at work and has no time for yard work or even to feed her kids - she “throws something at them while we run out the door”. That to me seems like someone headed to the LTR market sooner rather than later.

Did that make sense? Oh - shoot - I’m supposed to be making beds for a check-in!! Not sitting here discussing the issue! :grin:

Actually, I don’t even know what kool-aid is :frowning: But it’s mentioned so often in such contexts and this is quite a USA-dominated forum. I feel a bit stupid now! The point I was trying to make was that hosting successfully on airbnb is more than number/$ crunching. At least it was, anyway.

1 Like

Your point was spot-on.

Kool-aid is a packaged drink mix, sweet, in fruity flavors. I guess they still sell it - it was a treat when I was a kid. We had such things rarely. But a few times in my childhood my mom made up a ‘bucket’ of raspberry kool-aid with lots of ice, and squeezed lemons into it (I guess from her southern, sweet-tea roots). Boy, was it de-licious!!

So your turn-of-phrase was fun and brought back good memories and I’m quite serious I will ‘store it’ and put it to use to help me calm down when a guest is frustrating.

If you have a moment for some United States culture at it’s finest…
https://www.youtube.com/watch?v=nBeUGqeYsQg

@Magwitch It is a powder of fake ingredients that when you add water, becomes a disgusting sweet drink that some people actually drink. The flavors are created with absolutely no natural ingredients.

1 Like

Thank you. It all makes SO much sense now!!

1 Like