Is Airbnb right for you?
Earlier this week, Airbnb, an online homestay network that allows people to list or rent short-term lodging in residential propreties, announced it’s recent expansion to experiences, not just accommodation. The website now gives hosts the chance to offer tours, so people can buy packages such as a guided tour or cultural experience. While the debate over short-term rentals is raging in all of America’s, we wonder about the opportunities for landlords and property owners, as well as the drawbacks to neighbors.
The cost of an Airbnb varies—by location, demand, time of year, size—but is always set by the property owner. A property owner can rent out a room, a sofa, a bed or an entire home. There are more than 2,00,0000 listings in 34,000 cities and 191 countries, and growing.
Property owners see the appeal in short-term rentals. The owner of an apartment can rent out that unit for $2,000 per month, or rent it on Airbnb for $150 per night. Some owners own and rent multiple properties through Airbnb and make upwards of six figures per year. At 90% occupancy, a homeowner can make about $4,000 per apartment on Airbnb. If such owner pays about $2,000 of that in rent and utilities, that comes out to $2,000 profit per month, per apartment, or $24,000 per year, multiplied by ‘x’ number of apartments.
The legalities of short-term rentals through Airbnb are still being processed and sorted, namely when it comes to rights. Entrepreneurial landlords have the right to make a buck, while neighbors have the right to maintain the atmosphere of their locale. Some apartment buildings prohibit brief sublets by tenants who might want to earn extra money while they’re away—a landlords right to prohibit that. There are also controversial issues arising over taxes—full time rentals acting as hotels but not paying hotel-like taxes.
In vacation spots like San Clemente, Dana Point and South Orange County as a whole, Airbnb listings are rampant. The opportunities for property owners, or would-be property owners, are huge. If you’re thinking of purchasing an investment property with short-term rentals in mind, check with your GreenTree real estate agent to see which areas allow, or don’t allow them.