How to Rent Your Space on AirBnB and Earn Extra Money
Thinking of using AirBnB to help you make some extra cash? Converting your extra space into an AirBnB listing is simple and could be the boost to your finances that you’ve been looking for. You can list many types of accommodations on AirBnB — from full houses to shared rooms. While allowing travelers into your home does have its risks, thousands of hosts have successfully opened their doors through the platform, creating an extra stream of income for their families while developing new skills and relationships in the process. Here’s what you need to know to get started on AirBnB.
How to List Your AirBnB Space
Think you’re ready to try hosting on AirBnB? There are many tasks you’ll have to complete before you’re ready to start accepting guests to your Airbnb rental. While your to-do list might look startlingly long at the beginning, most tasks fall into the below categories.
Sign up on the platform
Signing up as a host on the AirBnB platform is straightforward. First, you need to indicate the type of property you are listing. This could be anything from a secondary suite to an entire house, or even a room in your apartment. AirBnB will ask you what category your listing falls into, in addition to specific information about how to classify your property. For example, if you indicate that you are listing a house, AirBnb will then ask if your house is a cabin, a tiny house, a bungalow, and so on.
After you’ve classified your property type, you then need to select the type of place. For example, you could list your entire property, a private room within your property, or a shared room. You’ll also need to state how many guests you will allow at your property, how many beds you’ll have, and what the sleeping arrangements are. You can change this in the future, so don’t worry too much if you aren’t quite sure what bed size you’ll use or how many people you want to accommodate.
Prepare your listing
Once you’ve signed up as a host, you’ll need to get your space into tip-top shape. This includes buying all the furniture for your space as well as linens, bathroom supplies, cleaning supplies, and, if you’re going to allow use of the kitchen, cooking utensils, and basics.
AirBnB doesn’t require you to include amenities such as a hairdryer or iron with your listing, but doing so could help you appear in more searches, or could tip the balance in your favor when a guest is deciding between two places.
Understand local zoning laws
More and more jurisdictions are instituting laws that cover AirBnB or short-term rentals. Some areas will require you to have a business license or permit before you start renting your space on AirBnB. Other jurisdictions restrict the number of nights you can have guests stay or charge an occupancy tax. Cities enforce these laws with penalties and fines.
Since local laws vary greatly by jurisdiction, it can be confusing to decipher what rules apply in your area. AirBnB has attempted to help hosts sort out the applicable legislation on their Responsible Hosting page with links to local regulations for major cities. If you are unsure what these local rules are in your area, you can usually uncover any specific short-term rental regulations by inquiring with your city hall.
Photograph your property
Strong photographs of your space can elevate the best qualities of your space and attract more guests. Be sure to take multiple photos of each room and include both interior and exterior shots. AirBnB recommends photos be at least 1024 pixels X 683 pixels and be sure to use natural lighting to your advantage by taking photos during the day with all your blinds open.
AirBnB’s data shows hosts can earn up to 40% more with professional photos. If you’d like to go this route, AirBnB will coordinate with a professional photographer to take photos of your listing. To book a photographer, you simply submit your listing identification number at the link on the AirBnB pro photography page. You’ll then receive a quote in a follow-up email. After accepting, you schedule a time with a photographer who will not only take photos of your listing but also retouch them. After the photos are published to your account AirBnB will take payment from your future earnings.
Set your rates and start accepting guests
After finishing all the preparation work, you’re ready to start accepting guests. All you need to do is determine your price. There’s a lot of flexibility when it comes to your nightly rate. You can opt to use AirBnB’s smart pricing tool, which will automatically set your nightly rate based on comparable locations nearby. You could also choose to set minimum and maximum prices and then let the AirBnB smart pricing tool adjust to those parameters. Or, you could set your own pricing without any input from AirBnB.
Before setting your listing to live, be sure to update your calendar. Block off any nights that you don’t want to accept AirBnB guests. You should also decide how much time you’ll need between guests to clean your space and how much advance notice you’ll need to prepare for a booking.
Alternatives to AirBnB
AirBnB isn’t the only short term rental platform. Here are some other ways to rent your extra space and how they compare.
|Cleaning||Host is responsible for all cleaning||Guest is expected to do some light cleaning||Host is responsible for all cleaning|
|Host fees||3% to 5% commission from bookings||Annual subscription of $499 or per-booking fee with a 5% commission and 3% payment processing fee||3% per booking plus 3% payment processing fee|
|Guest fees||10% to 13%||10% to 11%||8% to 16%|
|Property type||Shared or private accommodation||No shared rooms||No shared rooms|
|Damage insurance included for hosts?||Yes||No||No|
AirBnB vs. Vrbo for hosts
While Vbro, now owned by Expedia, might have slightly less brand name recognition when compared to AirBnB, the website, combined with its sister site HomeAway, has been in the short-term rental business for 25 years and benefits from this longevity, especially among its loyal renters who stay at the over 2 million Vrbo listings in more than 190 countries each year. While AirBnB charges hosts a commission on their listings, Vrbo offers two different pricing models — either an annual fee or a commission-based structure. Aside from that, a key differentiator between the two platforms is that Vrbo offers no shared rooms.
AirBnB vs. Flipkey for hosts
Flipkey, owned by TripAdvisor, is active in more than 179 countries around the world. While Flipkey offers a similar pricing model to AirBnB, keep in mind that they often charge guests a service fee of up to 16%, which could significantly impact the number of guests interested in your property or the prices you can charge. Also,w Flipkey does not offer damage protection for hosts.
AirBnB Costs to Consider
While AirBnB could be an excellent source of income, there are costs to consider when it comes to hosting. Here are some of the main costs of running an AirBnB:
- Home insurance: If you’re renting out space in your home for short-term rentals, it’s likely your home insurance policy will increase. Be sure to budget for this before you start hosting on AirBnB.
- Local fees: Registering and licensing your AirBnB could incur some upfront costs. These vary greatly by jurisdiction, so check with your local authorities.
- Cleaning supplies: Whether you’re paying a cleaning service or cleaning your listing yourself, it will cost money to buy all the necessary supplies to keep your space sparkling clean. AirBnB does allow you to charge guests a cleaning fee, so consider the true cost of cleaning when setting this fee.
- Furniture and linens: You may need to purchase additional linens or different furniture to make your space AirBnB friendly. Keep in mind that if you’re going to host guests back-to-back you’ll likely need a second set of linens in order to turn your space over in time for the next guests.
- Contactless entry: With touchless check-in becoming more prominent, many AirBnB hosts are installing keyless entry systems, or at the very least purchasing external lockboxes, which can run anywhere from $50 to over $200.
- WiFi and utilities: Having others in your space could impact your heating and electricity bill, in addition to your internet usage. Consider that many guests expect streaming nowadays, so if your internet isn’t fast enough to reliably stream films or do video calls you might have to upgrade.
- Toiletries and pantry staples: You’ll also have to keep a steady stock of toiletries, paper towels, toilet paper and pantry staples such as salt and pepper or cooking oil.
Be sure to retain copies of all purchases for your AirBnB so you can deduct the expenses from your taxes at the end of the year, since you will be taxed on your AirBnB earnings.
Pros and Cons of AirBnB Hosting
Still not sure if becoming an AirBnB host is right for you? Here are the advantages and disadvantages to sharing your space with travelers.
- Extra income: Hosting is flexible— use it to boost your monthly income, or increase the number of properties you have on AirBnB to make hosting your full-time job.
- Flexibility: If you don’t want to rent your space to full-time tenants, AirBnB can be a solution that allows you more flexibility over who is in your home and when. Block whatever dates you’d like to keep for yourself and open your calendar when you’re ready to host.
- The platform handles payments: Since AirBnB handles guest payments, and they collect them before your guest’s stay begins, you never have to worry about chasing payment or guests being late on rent.
- Damage: While AirBnB does provide compensation for guest damage, some wear and tear are to be expected. You can request a security deposit from guests, but can’t use this to pay for typical wear and tear on your home. Be prepared for scuffed walls, scratched hardwood, and little things that you’ll most likely notice as a homeowner. If you’re not used to people staying in your home, this damage can be hard to adjust to.
- Uncertainty: If you’re relying on your rental income to help with your mortgage, you have less certainty with AirBnB than you do with tenants who have signed a lease. While there’s a chance you could earn more from your AirBnB, there’s also a chance that you could earn less during slow months. These fluctuations require more advanced planning.
- Daily upkeep: Becoming an AirBnB host means you’ll need to be available at almost all hours of the day to answer questions, respond to reservation requests and even cleans up after guests.
The bottom line
While hosting on AirBnB can be a lot of responsibility, it can also be a savvy way to maximize your extra room or space and develop an extra income stream for your budget. The flexibility offered to hosts means you can host as often or as little as you like, scaling up or down depending on your financial or personal needs. Just remember to keep in mind the costs associated with AirBnB to ensure that your venture is as profitable as possible.