BusinessHABRun Airbnb as a Business: If you have a house, apartment, or spare room that you’re looking to rent out, listing it on Airbnb can be a great way to pull in a little extra cash.
It makes a convenient side gig and even has the potential to blossom into a full-time career with careful management.
The key to keeping your renters satisfied and encouraging repeat bookings is to take the time to craft outstanding listings.
It also helps to offer competitive pricing and furnish amenities that other hosts don’t.
If you’re serious about taking your Airbnb business to the next level.
Consider forming a legal business entity with yourself as the sole proprietor to take advantage of additional money-making benefits.
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Run Airbnb as a Business
1. Understand that running an Airbnb business is a major commitment.
A lot of work goes into staging and cleaning properties, creating listings, corresponding with renters, and maintaining a professional user profile.
This holds true whether you’re an occasional host or a full-time Airbnb mogul.
Make sure you know what you’re getting yourself into before you decide to make a living out of renting your place.
- If you’re not sure whether you can realistically spare the time, energy, and attention needed to make your Airbnb business a success, it may be wiser to just reserve your property for occasional listings.
2. Sign up for an Airbnb account.
If you haven’t already registered for Airbnb, you’ll need to do so before you can list your property.
Visit the Airbnb website and click the “sign up” link in the upper righthand corner of the homepage.
Then decide whether you want to sign up using your Facebook profile, Google account, or email address.
Once you’ve selected an option and entered the requested info, hit the “sign up” button and begin customizing your profile.
- Read through Airbnb’s Terms of Service agreement carefully.
- There, you’ll find all the information you need to get started.
- Once your account has been confirmed, you’ll be able to create listings, post reviews, send and receive private messages, and take advantage of benefits available exclusively to registered users.
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Run Airbnb as a Business
3. Calculate a projected profit margin that factors in probable costs.
Contrary to popular belief, Airbnb isn’t a pure-profit opportunity.
As a host, you’ll be charged 3% of your guest’s booking subtotal price each time someone books a stay with you, not to mention expenses related to cleaning, furnishing, repairs, and general maintenance.
Keep a running tab of these costs as you review your first few rentals to estimate how much money you can expect to sink into your enterprise in the long run.
- Be sure to account for these and other necessary deductions when determining a daily rental rate for your property.
Tip: To come up with a projected profit margin, check the average revenue yielded by your property against the average expenses required to maintain it.
4. Form a legal business entity to protect your Airbnb business.
Setting up a limited liability company, or “LLC,” is usually as simple as filling out a few pieces of paperwork registering your business in the state or territory where you’ll be operating.
After completing your Articles of Organization, submit them to your state’s LLC filing office.
You’ll then be recognized as the sole proprietor of your business.
- The biggest benefit of forming an LLC is that you yourself won’t be held liable if one of your renters decides to sue you for any reason, which can be a major relief if you plan on running a long-term business.
- Keep in mind that if you make your Airbnb business official, you’ll need to file a separate Schedule-C attachment along with your normal income tax documents. This form is used to report earnings and losses for businesses with a single owner.
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5. Open a dedicated checking account for your business.
Visit your bank and talk to an account specialist about starting a new account specifically for handling your Airbnb rentals.
You’ll use this account exclusively for depositing and withdrawing funds generated by your property.
That way, you can make sure that business interests don’t get tied up with your personal finances.
- Focus on merchant accounts that offer low transaction fees and additional benefits like introductory discounts and early termination that will help your money go farther.
- Don’t feel like you’re locked into using the same bank where you’re already a member. Exploring many different options will allow you to find a set of terms that works for you.
Run Airbnb as a Business
6. Consider purchasing separate insurance to cover high-value properties.
One of the biggest perks for Airbnb hosts is the company’s million-dollar host protection policy.
This will be more than enough to give most users a sense of security.
If you have rare valuables or risk factors like a leaky roof or deteriorating foundation at home.
However, it may be a good idea to apply for additional coverage to make sure you won’t be left on the hook in the event of an unforeseen incident.
- Look for a policy worth equal or greater to what you stand to lose in a worst case scenario as a host.
- Move any particularly expensive belongings you wish to safeguard to another location, if possible. If not, invest in a floor safe where you can stash your items while your property is occupied.
- Remember, sometimes you have to spend money to make money. If your budget permits, take the precautionary step of having potentially-costly issues fixed before they have a chance to become a problem.
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Run Airbnb as a Business
7. Come up with titles that serve to draw in prospective renters.
Use evocative terms and phrases to provide a brief description of your property right in the title.
Words like “quiet,” “peaceful,” and “idyllic” are sure to resonate with someone searching for the perfect place to book a relaxing weekend getaway.
The same person might not give a listing titled “2-bedroom townhouse” a second look.
- If your location boasts other features, such as greenway access or proximity to a major metropolitan area, be sure to mention them as well. A title like, “Fully Outfitted Penthouse Overlooking Bustling Brooklyn Arts District” is sure to intrigue.
- A little flourish is good, but try not to overdo it. Using too many descriptive words will make you seem like you’re trying to sell something rather than letting the property sell itself.
Run Airbnb as a Business
8. Upload high-quality photos that highlight your property inside and out.
Take multiple pictures from a variety of flattering angles.
You’ll want to at least show off each of the main areas, including the bedrooms, bathrooms, kitchen, laundry room, and living room or recreation area.
Don’t forget to grab a couple snaps of the property’s exterior while you’re at it.
- It will also be worth your while to put up shots of luxuries that your competition might not be offering, such as a swimming pool, stocked mini-fridge, or private office space complete with WiFi.
- If you’re serious about optimizing your listings, consider hiring a professional photographer to capture your property’s best side.
Tip: Top-rated hosts recommend posting a minimum of 10 photos of a given property for maximum visual appeal.
Run Airbnb as a Business
9. Write out a detailed description of your property.
Let your renter know exactly what they can look forward to when they book a stay in your home, apartment, or spare room.
As you did with your title, use colorful words that paint a picture of your property’s basic amenities and greatest assets.
Create separate descriptions for all the main rooms, and round out each section with specific details about any other features you’re making available.
- A standout description might open with a paragraph like, “Enjoy the sights and sounds of nature from a rustic Dutch-style cottage nestled in the historic woods of Lancaster. 3 fully-outfitted bedrooms will sleep you and up to 5 other guests. Each room also offers its own private bathroom, as well as access to the property’s multi-level wraparound porch.”
- Be specific—instead of simply listing the appliances in your kitchen, name the exact brand or style, as in “6-burner gas cooktop” or “LG Smart Refrigerator.”
- Providing extra amenities like board games or a stack of the latest bestsellers that you can touch on in your description could mean the difference between an outstanding listing and an unremarkable one.
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10. Price your property competitively with other nearby rentals.
Even if you’re trying to make Airbnb your primary source of income, setting attractive prices is key for securing bookings consistently.
Do some research to find out what other hosts in your area are asking, then settle on a daily rate on the low end of the same general range.
Make sure your asking price reflects the cost of utilities, cable, cleaning fees, and anything else you’ll be on the hook for as the owner.
- If you need a place to start, first calculate the average daily cost of your property by dividing the combined cost of your monthly rent and bills by 30. Then, multiply that number by 300-400% to ensure that you’ll be generating a profit. For an apartment with an overhead of $40 a day, you might set your daily rate at around $120-160.
- Once you’ve worked out a fair base rate, you can increase your asking price a small amount for each noteworthy amenity you’re offering, such as a pool table, steam room, or outdoor fire pit.
- You also have the option of taking on a security deposit of $100-5,000 to cover unexpected damages. A good rule of thumb is to set your deposit to match the price of a one-night stay at the property you’re listing.
11. Keep your property clean, comfortable, and well-appointed.
Think about what kind of place you would like to stay in as a guest and provide furniture and amenities that people will actually want to use.
Try to inject hints of style and personality without making your guests feel like they’re intruding in someone else’s home.Which can make for a somewhat awkward stay.
Decorating with tasteful selections of art and literature and providing new.
Unopened toiletries are simple ways to create an atmosphere that’s welcoming yet not overly intimate.
- Keep personal belongings put away to make your space more inviting. If you currently live in the property you’re renting, leave a note explaining which rooms or items are off-limits.
- You can either clean your property yourself or hire a professional cleaning crew to come in and take care of it for you.
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Run Airbnb as a Business
12. Prioritize prompt communication with your renters.
Set aside time each and every day to respond to questions, concerns, and reviews posted to your Airbnb profile. Interacting with your guests shows that you care enough about their experience to stay in contact despite your busy schedule. This goes for past renters as well as present and prospective ones.
- Address complaints and negative reviews publicly to show other users that you’re easy to get ahold of, then follow up privately via email if further action is required.
- Be sure to let your renters know if there’s a more convenient way to get in touch with you, such a private phone number or messenger app.
Tip: Do your best to return emails and private messages in a timely manner. The longer you leave someone waiting, the more likely they are to lose interest.
13. Implement guest feedback to secure more positive reviews.
When it comes to running an Airbnb business, good reviews are the best form of advertisement.
Take any constructive criticism you receive in your reviews to heart to ensure that your next round of guests enjoys their stay even more than the last.
No matter how nice your property is or how many amenities you offer, there’s always room for improvement.
- If you really want to go above and beyond, get in the habit of doing extra things for your guests, like leaving a supply of coffee or snacks or sending a personalized letter of welcome to everyone who reserves with you.
- A mediocre star rating could be enough to make a potential renter change their mind about staying in your property, no matter how polished your listing is.
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14. Leave reviews for guests you like to encourage repeat bookings.
Managing a thriving Airbnb business is all about give-and-take.
Be sure to extend your renters some praise for their punctuality, cleanliness, responsibility, and similar good behavior to boost their ratings and let other hosts know that they come recommended.
Establishing a congenial relationship will make them more likely to think of you for future stays.
- Keep your comments brief, complimentary, and to the point. Most people don’t like to read long, drawn-out reviews.
- If you like, you can also assign a star rating to past renters, indicating at a glance that your experience with them was a positive one.
Run Airbnb as a Business
15. Advertise your property elsewhere on the web for even more hits.
Once you’ve finalized a listing on your Airbnb page, post the link on your personal social media accounts.
Invite your friends and followers to share your listing to make sure it sees the greatest number of eyes possible.
- Travel blogs, vacation rental forums, and the housing sections of popular networking sites like Craigslist and Reddit can also be good places to promote your Airbnb business.
- For a more old-fashioned approach, you could also try printing up business cards or flyers with information about your listings and distributing them in places where people tend to gather, like supermarkets, coffee shops, and fitness centers.
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More tips
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Treat your Airbnb business like you would any other business.
Always be looking for new leads, keep accurate records.
And be willing to put a portion of your profits towards maintaining or making improvements to your property.
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You may need to get permission from your landlord if you want to list an apartment, house, or room that you don’t own.
BusinessHAB