“I will just Airbnb my cottage”. Yes, you can you rent your cottage using Airbnb! But like anything else in life I think it is important that you know the pros and cons of Airbnb before making that decision.
1) You can generate revenue in a semi- passive way. This is especially true if you are not doing the cleaning and minor repairs on your own. However, as you will see below in the cons you are still on 24/7 customer service for your clients and to market your property.
2) Many hosts rent out a room or live in another place on the property such as a bunkie or an apartment over the garage. If you are living on the property or conversing frequently with your renters via email you do get the opportunity to meet some very interesting people.
3) Short term rentals can generate more gross revenues than long term rentals. The caveat being it may not be as consistent an income stream as a long term tenant and it may take time to build up your reputation in Airbnb.
4) What many Airbnb rental owners don’t always talk about is that it can be a fun and rewarding experience and increase morale when you get good reviews on your property.
5) Airbnb allows for flexibility in the rental lengths versus the traditional long term rentals.
6) Airbnb allows the property owner to identify people who often give negative reviews and are repeat offenders so you can try to avoid renting to them. If you do get a bad guest it is only for a short term.
7) Airbnb provides Host Protection of $1 mill for injury and damages and Host Guarantee of $1mill for damages to your property. Of course there are exclusions so please read the airbnb documents carefully.
8) The Airbnb platform makes it easy for beginners to get into the market for free and access to a lot of renters.
1) “Stranger danger “. If rent your whole place versus a room you are not there to supervise and things will get broken, people will refuse to leave etc.
2) You are on call 24/7 . You will answer all the questions for potential renters. Once the client book until their vacation starts there will be various questions and once on site there will be more questions. You will be responsible for answering all of these questions, comments and complaints. Typical questions are requests for discounts, what is provided in the house as far as amenities, how things work in the house, what around locally and so much more.
3) You cannot please everyone and you will quickly learn that some people complain about everything. You have to be okay with negative feedback and reviews!
4). Time is money. Your time included. When considering this don’t forget to include your marketing and administrative time. It can be a lot of logistical work to coordinate cleaners and handymen. If you are doing it on your own you have to be available and near by to get bedding and towels changed and washed and check for damage/theft between renters especially if your property is rented back to back.
5) Airbnb is one website and to get proper exposure most renters use multiple websites which means you need to constantly market the property, make sure your rates are current and competitive, somehow figure out how to sync all of the booking platform calendars to avoid double bookings and coordinate multiple vendors/cleaning services etc
5) If you do not set up your bookings properly your expenses could be more than a longterm rental.
6) Maintaining ratings in Airbnb is stressful. You will need the site add ons to maintain 5 star ratings. as other hosts raise the bar in rental offerings. The rating you have on your property will be a large part of the algorithm that makes your property pop to the top of the list and give you a lot of exposure or puts you several pages down which means less exposure.
7) There is a learning curve and a level of expertise needed to be relevant on Airbnb and show up higher on the algorithms. This is even more or an issue if you are in an area with a lot of properties on Airbnb. How do you make make sure you're pricing is current and competitive? How do you make sure you get the reviews you need? There are many things to consider with your listing on Airbnb.
8) You will be required to watch and know the rules and regulations for short term rentals in your area ( taxes, licensing, restrictions, airbnb bans etc).
There is so much to think about before you just through your cottage up on Airbnb for rent. Smart cottage owners will investigate all of their options. Next weeks blog will investigate what it means to use a property manager to manage your cottage rental.