If you are a real estate investor or want to become one, chances are you have already heard about the amount of money you can make by investing in a short-term rental property. For real estate investors who are looking for a potentially passive source of income, investing and capitalizing on the Airbnb revolution can be an amazing start. With short-term renting platforms like Airbnb, almost 54% of real estate property owners are looking to turn their primary and secondary homes into Airbnb properties. On average, an Airbnb host can make up to $924 a month in a top-tier city in the United States. There are also many reputable companies offering Airbnb properties for sale for real estate investors looking to invest in vacation rental properties and short-term rental homes.
Depending on your marketing strategy, amenities and services offered, the location of the property, and the quality of your property, your Airbnb venture can become a huge income potential as modern travelers are looking for affordable hotel alternatives along with homely environments and unique experiences. Let us find out how you can find the best Airbnb property and turn it into a profitable venture.
Tips For Finding The Best Airbnb Properties:
- Choose the Ideal Location
One of the key determinants of your Airbnb property’s ROI is the occupancy rate which is directly proportional to the city in which it is located. To check whether your Airbnb property will be a profitable venture, you should check the average daily rate and occupancy rate in its neighborhood. Hence you can earn more from your rental property if the location is not affected heavily by seasonality and the rental property does not stay vacant for a long period. This is a global tip that is not only exclusive to the United States. Places like Nevada, Texas, Florida, Chicago, New York, and Washington are some of the top places to look when investing in an Airbnb property.
- Check Out the Rules and Regulations
When you are considering investing in an Airbnb property, you should check out the updated rules and regulations stated by the platform. This way you can check whether or not it’s legal to be an Airbnb host in your desired location, whether you meet the required conditions as a host, the taxes and fees associated with the property, the number of booking that is allowed for your property, and what kind of registration and special rules are applicable to your chosen location. It is noteworthy that local authorities in many places have started imposing strict rules and regulations and sometimes even prohibitions on short-term rental properties.
- Choose Your Property Type
The nature of your property’s market will dictate the type of property you should be investing in. For instance, if your property is located on a mountain, you can go for a “cozy mountain-top property” by investing in a cabin and turning it into a comfortable space. Likewise, you can invest in a small apartment or condo for a busy city that is frequented by business travelers.
- Plan Your Financing
There is no guarantee that all Airbnb investment properties will yield high income. You might face a huge loss if you don’t plan your budget well. Hence you should budget carefully by taking mortgage and maintenance fees into consideration along with other property expenses like property taxes, closing costs, repairs and remodeling expenses, property inspections, insurance, and furnishing.
- Plan to Handle Bookings
There is a lot of work involved while managing an Airbnb property as you will be dealing with a lot of people. You can start looking for short-term rental management tools, create a house manual, and outsource some of your managing tasks. You can also get in touch with a reliable and professional property manager to do the job for you.
You can be successful and gain a lot of profit when you invest in the top Airbnb properties. The statement stands truer than ever for tourist destinations like New York and Florida which welcome millions of tourists annually. But as travel experiences are evolving and travelers are looking for unique and newer places to explore, even the remotest property in the world has a huge earning potential. For instance, Pitcairn Island in New Zealand is home to 13 Airbnb local home properties and is known to be the most remote Airbnb on earth. How fascinating is that?
Just like any traditional investment property, investing in an Airbnb can provide you with amazing returns if you play your cards right. Moreover, unlike traditional renting, Airbnb owners charge nightly rates for the same property, which can triple or quadruple the amount of potential rent from the traditional renting system. The low cost and easy advertising of Airbnb properties is another advantage that we can mention. So as a property owner or a real estate enthusiast, you can start looking for potential Airbnb properties for the highest return on investment.