Airbnb Set to Die?

What is the buzz about Airbnb and why is it being brought up at family dinner? Is Auntie Josephine going on about yet another conspiracy theory that Airbnb is set to die? Is it a conspiracy theory? Aunt Josephine was wrong about the last conspiracy theory, wasn’t she?

My goal is to dispel the myths about Airbnb, and shine light on why landlords are choosing to Airbnb their property instead of rent it on the long-term market. 
Let’s start with the bad.


What are the reasons to not Airbnb your property?

Firstly, if you want your property to generate consistent income, you should never consider Airbnb. The price that guests pay is different every night, and there is no certainty that your property will be rented. Your income may be seasonal and irregular. If you are looking for consistent income, you should rent your property as a long-term rental. Please consider long-term renting your property to Host Solutions and we will pay you consistent income every week.

Secondly, if you are looking for the least work possible, you should probably rent your property long-term (or not at all). Like a property that you rent long-term, a short-term rental requires ongoing work (even if you have a property manager). Maintenance, finding and managing tenants, organising repairs, and inspecting the property and evicting tenants are common to both short-term and long-term rentals.

A short-term rental will, however, incur more expenses such as cleaning, restocking amenities and possibly replacing items that are missing or damaged. Your property will need to be marketed with have high-quality photos and captivating property descriptions. When your guests have arrived, your message templates, customer service skills and property’s amenities will be put to the test. And, of course, after guests leave, the turnover process for the next guest begins. Beds and towels will need to be changed and your property will require cleaning. In short, it is much more than simply being a landlord!

If you employ an Airbnb property manager, they will organise these things for you. However, you may still have more work than you would with a long-term rental as you may want to check that the property manager is doing a great job.

Lastly, short-term rentals could incur more damage than long-term rentals. While most bookings do not result in damages, some guests specifically book via Airbnb with the wrong intentions. Luckily, there are fantastic ways to reduce the likelihood of this occurring such as screening guests, using devices to monitor the level of decibels in your home and having outside-facing cameras to see how many people are going into your property. The Airbnb Host Guarantee is also fantastic protection as it covers up to $1M of personal property damage. Additionally, separate short-term rental insurance may be something to consider.

What are The Reasons to Airbnb your Property:

The first reason to consider Airbnb for your property is the potential to increase your income. As you will be renting out your property at rate than a long-term rental receives, you can generate additional revenue. For example, one of our properties just received a booking for just over 2 months where the guests paid over $20,000 (over $390/day). For a house that has been appraised at $550/week on the long-term market, this is a significant result. Have a look at our Airbnb Calculator to determine how much you can make.

Secondly, with no long-term lease agreements, you are more flexible renting your property on the short-term market. With tenancy laws tightening in South Australia, long-term leases are becoming more difficult to exit and more difficult to maximise income. For example, the government has just proposed these new laws.

With Airbnb, there is no need for a lease agreement. You have your house rules and Airbnb also has its set of rules to help protect hosts. This means that if a guest breaks your house rules, you can reach out to Airbnb immediately instead of having to enter a long-drawn-out legal matter where tenants need to be evicted. You can also require guests to sign a vacation rental agreement like this for added protection.

Lastly, if you rent your property as a short-term rental, you can still enjoy it whenever you like. Block out the calendar for dates that you would like to use the property and earn income when you are not using it. Block off a room or a garage for your personal items so that you can keep your property feeling like home.

Conclusion:

When deciding if Airbnb is right for your property, it is important to consider all the factors. Airbnb has the downsides of generating inconsistent income, being more work than a long-term rental and having a higher risk of your property or possessions being damaged. But thousands of landlords in Adelaide alone have opted to Airbnb their property for a reason. Airbnb provides an opportunity to increase your income, evade long-term leases and allow you to enjoy your property whenever you like. 


Please contact us to hear about how our properties are performing.