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What to consider when switching a long term rental to a short term rental?


#21

It’s interesting reading the input. Some people sound like doing Airbnb is a lot of work and some don’t. I think a lot of work will depend on a number of variables. Airbnb is the easiest money I’ve ever made. There can be episodes that are frustrating or disruptive to normal life but for me the calculus between investment of money and time and return on that investment is hands down the best I’ve had. I would absolutely recommend trying it, especially if you are in good location with a unique property. And by unique I don’t mean quirky, I mean things guests might value like two BR and private entrance.

If you read here as much as possible, read the Airbnb guidelines and TOS and come here with questions in advance of anticipated problems, you can probably avoid the problems. Reading here may also make you scared but you have to realize most people come here after issues appear and come with complaints. The hundreds of thousands of hosts who have never had a problem haven’t found us yet.


#22

You don’t need much investment to start sort term unless there is no furniture.

Why don’t you try not long term but " longer" terms. Like 2 weeks or 1 month or even longer . That works for me very well


#23

Great post. I would add the think that many/most hosts don’t do when looking at net profit is to cost their time into the equation. Buying things for the listing, marketing, maintenance, cleaning, managing bookings, check in etc.

If they did I think they would find in some cases once they figure in local government taxes, insurance, utilities etc that it is not a lot more profitable than a LTR.


#24

What part of Portland are you in? You can try marketing yourself as family-friendly (I welcome babies, toddlers and supply the extra stuff they need) to mediate the noise issues. Often families with kids (not nec babies) are tolerant of kid noise (I’ve also found grandparents to be very tolerant). Just put the kids and noise issue in the ad upfront – I post that my kids are asleep and basement apt is quiet from 8pm-7am and I still do get many bookings from people who don’t plan on being home in the day. (including business travelers and couples).


#25

Here is the shorthand equation it use.

LTR/30 (days in month) = current LTR nightly rent. “for comparison only”

LTR - expenses and fees, vacancy, repairs, etc. = LTR net income

STR x average nights rented per month = expected STR gross income

From STR Gross income subtract all extra expenses like furnishing the apt., toiletries, towels, permit fees, management fees, your extra time (it is a business so factor your time in $$$) etc. This will give you an estimated “Net STR income”

Then compare (LTR Net income Vs. expected STR Net income)

For example:

I was renting my duplex for $1850 ($925 / unit) including utilities. Divide $925 by 30 nights = $30.83/night. In my market for a 2 bed 1 bath I could easily get $75-$125 a night with STR. Through research and asking other hosts I learned most STR in my area is booked at least 15 nights a month in our slow season and 25 nights a month in our high season. So my estimates are slow for 6 months ($75 x 15 nights =$1,125 per unit) and high season ($125 x 25 nights = $3,125 / unit). My gross average LTR is $1,850 a month or $22,200 a year. My gross annual average for STR is $4,250 a month or $51,000. (This is Gross income estimates and an example. Next I would factor in my expenses to each scenario to get a more accurate estimate.)


#26

These are some great pointers, thanks!


#27

Thanks for sharing more about how you calculated the switch would turn out well for you. This is really helpful!


#28

These are some great tips, thanks!


#29

Thanks everyone for the insights, tips and helpful feedback. I’m off to do more local research (ie: chat with my accountant on taxes (city and state) and any other implications of airbnb income, and other airbnb hosts in my area). The feedback here has been great and given my lots to think through!


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