How to start an Airbnb business the right way
Thinking about launching your own rental business? Learn how to start an Airbnb business so you can maximize your short-term rental income and have complete book occupancy throughout the year.
Thinking about launching your own rental business? Learn how to start an Airbnb business so you can maximize your short-term rental income and have complete book occupancy throughout the year.
Starting a new business, although exciting, can also be a lot of work, especially if you don't know where to begin. Nonetheless, many entrepreneurs are choosing to start a growing industry by operating an Airbnb rental. And as the world reopens, there is no denying that the number of Airbnb guests, whether leisure or business travelers, will continue to grow as the travel industry resumes. Therefore, if you are thinking about starting a business, you may find success in the estate rental industry.
To learn more about how to start an Airbnb business correctly, keep reading for more information.
From pricing and cleaning services to check-in times and house rules, starting a new Airbnb business can be daunting at first. However, by following these comprehensive steps on how to begin, you can be one step closer to making an Airbnb income. Let's take a closer look at how to start an Airbnb business in more detail below.
The first step to starting any new business is to compose a business plan. In your business plan, you will want to determine factors, including the following:
The next step is to choose a catchy name for your new property. For example, a name like "____ vacation oasis" is more likely to catch the eye of future renters. Make sure that you do some research in your area and choose a name that isn't already being used. That way, you can stand out among other properties and be easily identifiable to Airbnb guests if they choose to spread the word about your property.
Furthermore, to ensure your personal assets remain protected and separate from your business, consider registering your business as a legal entity. We suggest registering as a limited liability company in your state as this will ensure you are protected from debts and liabilities.
Moreover, the next step to starting a successful Airbnb business is to register for taxes. Regardless of what state you choose to operate in, you will need to pay an occupancy tax and a sales tax on all Airbnb income you make. Generally speaking, you will want to take this tax off monthly and keep track of all business expenses you purchase throughout the year.
Accordingly, you will be able to submit these expenses for a tax credit at the end of the year. Therefore, it is suggested that you hold onto and organize all purchase receipts.
As a rental business, you will need to purchase homeowners' insurance for your property. Additionally, you will also need an insurance policy that protects you against damages, general liabilities, and third-party injuries that may occur on your property. Remember, operating under the right insurance plan can help ensure that you are comprehensively covered in the event something unexpected should happen to your home or one of your Airbnb guests.
Moreover, once all the administrative tasks are complete, you will then need to make your property listing online. This includes:
Now it's time to officially launch your Airbnb business. Similar to all small business owners, your job is now to ensure that guests have a positive experience during their stay. That way, they are more likely to leave positive reviews on the Airbnb website. You can do this by:
Once you have successfully begun your Airbnb short-term property business, you will then need to decide whether it works for your current lifestyle choices. For example, if you are always working and are struggling with a work-life balance, you may wish to consider hiring a property manager or assistant to help you with your listings. On the other hand, if your first property is doing very well, you can then consider purchasing a second property to expand your Airbnb income in the future.
Furthermore, once you have gone through the steps listed above to start your own Airbnb business, you may wish to keep a running checklist of items and services that you should have on your Airbnb property for potential guests. To help you get started, we've put together a list of things you should consider keeping at your short-term vacation rental. Click the link to download our PDF version. Remember, while your checklist will vary depending on the type of vacation property you choose to purchase, these items will help steer you in the right direction to ensure you don't miss anything important.
Moreover, another essential step to consider when launching an Airbnb business is your city's Airbnb regulations. These regulations typically include zoning laws and administration codes. Additionally, the majority of Airbnb hosts must also register their property as a vacation or short-term property with their city and obtain a permit or a license to run their business legally before they are able to welcome renters to stay.
One thing to keep in mind is that city regulations can be confusing. However, you can find more information on occupancy tax, zoning laws, and more on the official Airbnb website. Further, if you are still having difficulties with regulations for your new business venture, consider calling your city hall directly to speak with a representative for more information. That way, you can ensure that you are following all local and state laws while avoiding any unexpected fines later down the road.
Further, if you're still having difficulties figuring out how to start a successful Airbnb business, online forums like Reddit are a great place to look for more tips. In fact, you'll be happy to know that there is a forum on Reddit dedicated to helping out new Airbnb business owners.
The Reddit forum is called r/Airbnb, for your ease of reference. With 281,000 members, you can find anything from advice, things to avoid, guest experiences, and more. Therefore, if you are seriously contemplating starting a short-term property rental with Airbnb, we highly suggest taking a look here as well. With that said, here are three direct quote tips from the forum page we think may be helpful to you.
1. "Print out a QR code to connect to your Wi-Fi and put it up on your wall for guests." – u/acrane55
Guests love convenience, especially when they are on holiday. Therefore, to enhance the guest experience for your renters at your Airbnb listing, consider adding a QR code as stated by u/acrane55.
Property management isn't easy. And if you're expecting your Airbnb business to be a breeze at first, think again. Many business owners working in the rental business are more of a full-time job than a passing, extra income opportunity. So, keep this in mind when determining whether this is the correct type of new business endeavor for you.
Moreover, like any small business, it is essential to know who your target rental market is. That way, you can use social media and other marketing efforts to reach the correct potential guests depending on your Airbnb property and what amenities it has to offer travelers.
Lastly, we've put together a list of frequently asked questions you may have as an aspiring Airbnb business owner. Let's dive into these questions in detail below.
On average, Airbnb rental property owners can make an additional $950 a month. However, keep in mind that your Airbnb income will vary depending on several factors, including:
Additionally, property owners should keep in mind that they will need to pay upfront costs, especially if they are purchasing new real estate before they are able to increase their monthly cash flow.
To start a successful Airbnb Business without owning a real estate property, consider the following options:
As you can see, starting an Airbnb rental business isn't a walk in the park. However, by following the comprehensive list we have put together for you above and downloading our complimentary checklist, you'll be one step closer to launching your business and making a profit.