This forum is dedicated to connecting hosts with other hosts. Sign up to get the latest updates and news just for AirBnb hosts! Note that we are not affiliated with Airbnb - we are just passionate hosts!
Hi guys, I’m currently living in Australia and miss Europe greatly. I am looking to buy a property in Paris and finance the repayments through renting it out via Airbnb and the use of one of these Airbnb agent companies present in big cities.
I’m not looking to make much of a profit, I just want to cover the cost of the apartment whilst allowing myself and my partner to live there for 2-3 months a year to see family etc.
I understand the Paris govt have introduced various restrictions which TBH sound fair enough, so I’m just wondering if this scenario is possible at all at this point? Both legally and financially (as I understand it, as of last year financially it was still very viable).
If you wish to let on Airbnb in Paris for more than 4 months in the year you need a commercial licence. I don’t know hard these are to get but I would expect it not to be easy as it means removing residential stock from the housing market.
@Barthelemy could advise you about this. We went last year for the Open, with the plan to buy something, and learned it is extremely difficult to short term rent.
The general law in France is that in cities over 200,000 inhabitants, their inner suburbs, and an additional list of small touristic cities, you have to get a special authorization from the city.
Each of these cities has its own rules. In Paris city, you would have to buy special rights to turn housing into what the city considers a commercial unit. they are named “droits de commercialité” and are sold from 1000 to 2000€ per square meter. You don’t buy these rights from the city, but from people or business who turned offices or shops into housing and as a consequence have the equivalent square meters of “commercial rights”. Beware that in the inner neighborhoods of the city you have to buy 2 meters of commercial rights for 1 meter of short term rental. There is a similar rule in Lyon and Marseille, but in Strasbourg ans Nice I know you get the authorization for free but it is limited to 9 years per apartment per owner.
To be honest, in Paris, with the real estate prices, the number of listings (45,000 in Paris city and 70,000 in greater Paris), the low nightly rates due to the very competitive environment and the cost a management company I don’t see how you could be anywhere near profitable. Paris mayor is not favorable at all to Airbnb and chances are that the conditions will only get tougher.
Las time I checked though, the very nice inner suburbs of Neuilly-sur-Seine and Vincennes had no special crazy requirements to give the authorization.
@Ciaran_Doherty I would never buy a property on the assumption you can cover the mortgage and costs through BNB a dangerous path regardless of local laws. It is far to unstable an income.
If you need to cover your costs you would be better looking at long term lets.
Speak to local mortgage brokers and estate agents to see if your figures stack up.
You also need to consider the stress of waiting for bookings to come in. I encounter that stress every few months - right now I have someone checking out on Saturday and then my calendar is wide open. I’m not using the money to cover expenses, but it’s still stressful.
@Zandra and @azreala have been discussing this approach to pricing - and playing ‘poker’, or ‘chicken’ when looking at pricing and dates. It’s not for the faint of heart. And it can be a constant thought - “am I charging to much? Did that last guest get it for to cheap? If I hang on will I get more money? Should I lower the price and get at least something?”. To my experience you can’t depend on the pricing services. I may try one again in the future but was very dissatisfied with my recent experience. So you, yourself, will have to be analyzing the market, checking out the competition, etc., to see what your prices should be. It’s not a stagnant situation - it’s very dynamic.
I feel like I should jump in, as someone who has STR properties as investments, and yes buying with the plan to only STR the properties. Vacation Rentals have been around forever in more touristic places, just bc ABB made a very easy to use platform, this does not mean they created the industry. They also made it possible for every city to have vacation rentals, not just the major tourist hubs.
I personally do not think buying a property for STR is a bad idea, as long as you do your research and have a solid back up plan if the proverbial poo hits the fan and you can no longer STR. This happened to us in one location, and at the time I thought it was the end of the world to get a LTR or do over 30 day rentals, it ended up being WAY less hassle than STR. I’m making about 15% less, but I like to think my sanity is worth it.
There are many sites out there that can give you projected ROIs and what you can expect for yearly revenue etc. Mashivisors, AirDNA, Everbooked, Beyond Pricing, are just a few. The issue you will run into is the non USA data for most of these companies is not the greatest, but will at least give you a good start.
Thanks @azreala I think if you take the sort of professional approach you mention you are right it can work but for far too many they see BNB as a quick way to make a dependable income without putting in the leg work.
The bottom line for me is that in most cases if you are soley dependant on the BNB income and you get no bookings, you are stuffed. If you have other ways of covering a shortfall then it is more feasible.
There are some very well managed companies in Paris that manage short term rentals. They do not use AirBNB. I have rented apartments through http://www.lodgis.com/en/ and found them to be very professional. The apartment that I like to rent is actually someone’s primary residence, and they rent it out when they are at the country house. However, quite a few properties that they represent appear to not be a primary residence.
The larger issue is that in Paris you need to have a commercial permit as @Barthelemy expalined above, that probably wouldn’t make it ideal for an investment property.
@Helsi as with any business you have to be agile or you won’t make it and you also have to prepare for the worst case scenario.
I read lately that people buy old shops/workshops to turn them into short term rental apartments as a way to circumvent the regulation, which is somewhat ironic as years ago the city banned the conversion of ground-floor shops into apartments, but as they have zoned STR as commercial units it seems it is now legal to set up a STR in a shop, office or workshop.
It’s not true at all that it’s extremely difficult with short-term rentals in Paris.
However, it may be more interesting to invest in a property to rent it out long-term.
You could get a yield of 5-10%/month.
