For many, Airbnb began as a way to rent out the spare room in your home or your vacation rental while not in use. However, the earning potential has led many to consider purchasing property as an Airbnb investment. Here are just a few things to consider beforehand.
Not All Properties Can Be Listed
Airbnb is quite popular in Northern Virginia but before you purchase a property you must ensure it can be listed on Airbnb. For example, not all condo associations allow their tenants to rent on Airbnb and not all mortgage companies allow you to sublet. However, you may be able to rent in a more traditional manner. Last but not least, you must understand Airbnb’s terms and conditions.
Consider All The Costs
Airbnb is attractive in that you can potentially make more money per night than a standard tenant would be willing to pay for rent, but you must consider all of the costs. Some of these costs can be offset by charging more per listing, such as a separate cleaning fee and a security deposit. Costs include but are not limited to:
- Monthly mortgage
- Property taxes
- Ongoing repairs and maintenance
- Monthly utilities
- Fully furnishing the home
- Airbnb’s booking fee
- Cleaning your rental between guests
- A property manager to assists guests when you aren’t available
- And more
This all adds up, so you need to be sure you can cover your monthly costs while generating a profit. There are no guarantees as to the number of bookings you will have on a monthly basis, and most listings start off slow—so you must have a cash cushion in place.
You Will Have Tenants
Another factor you must take into consideration is that you will need to be available to your short-term tenants. Even if they are only staying a night or two, they may have several questions both before and once they arrive. You also have to be there to drop off and pick up the keys, and with travelers, this is not an exact science as flights and traffic delays can make a precise time difficult to pinpoint. One way around this is to hire a property manager to take care of all this for you.
Airbnb Is Not Your Only Option
While Airbnb gets the most attention it’s certainly not your only option for short-term rentals. In addition to renting your home out daily or weekly you can also consider working with a local property management firm to explore your other options. This might include month-to-month leases or listing locally as a vacation rental property, which often attracts a different clientele than Airbnb.
There is certainly excellent income potential with Airbnb but as with any real estate investment, there are no guarantees. At the very least, have a Plan B in place, such as more traditional leases and rentals, incase Airbnb doesn’t live up to your expectations.
Looking For An Airbnb Investment Property In Norther Virginia?
As property managers and real estate guides who’ve been in business for 50 years, the team at Jerry Sardone Realty understands what to look for in a short-term rental investment property. Reach out today to discuss your options!