Airbnb Income: How to make money on Airbnb?
Among the most profitable ideas for companies in the 21st century are companies known as startups. One of the most important startups, Airbnb, was founded in 2007 by two friends looking to pay rent. This small company came to redefine what we know about travel and rent.
The bustling business scene of renting property on Airbnb has been attracting many aspiring property owners and business people. This article will show you how to make money on Airbnb as well as answer some of the very frequent questions:
- How much does Airbnb charge me, and How much does maintaining a business usually cost?
- How much can I charge for rent?
- How does Airbnb pay the hosts?
How much does Airbnb charge me, and how much does maintaining a business usually cost?
It might come to many readers as a surprise that listing your place on the Airbnb website is entirely free! Hosts who wish to start an Airbnb business can simply set up a listing on the website and wait for guests to reserve there. However, there is a catch when making money on Airbnb, Airbnb collects a fee of 3% from those offering accommodations, and Airbnb guests also pay a fee when they use the website to reserve.
While the 3% fee Airbnb themselves collect isn’t much, the main cost of renting your place is the fees you will need to pay. These include but are not limited to:
As with any property, with prolonged use comes wear and tear and, with that, the need to pay for services such as plumbing, electrical repair, etc.
One must remember renting out your place means providing guests with things they may need during their stay. These expenses will gather up to be what we refer to as turnover fees for running your Airbnb.
Expenses for cleaning
In case you use a cleaning service to keep the property in tip-top shape, you can expect to have to pay for that as well.
Regulations and licenses
If the city or area you live in requires a license to rent out your property, you must spend a sum of money on acquiring a license.
How much can I charge for rent?
One of the benefits of making money on Airbnb is that the amount you want to charge is entirely up to you. However, we recommend finding a sweet spot based on several factors, as prices too high may deter many potential guests from considering your listing. Factors that may help you set a correct price for your listing include:
Expenses and fees
Naturally, the number of expenses or fees you have to pay for your property directly affects the pricing for rent.
If your place is close to the city center or highly sought-after public amenities, make sure to take that into account when setting the price for the rent of your Airbnb listing.
Public taxes and regulations
If renting property using Airbnb and on a short-term basis in your area needs a license or carries special taxes for Airbnb; then you may need to charge guests higher for your business to be profitable.
How does Airbnb pay the hosts?
Airbnb usually processes payouts around a day after the guests have checked in. The options for making money via Airbnb payouts are highly dependent on the region you live in; however, some of the most popular forms of payout consist of PayPal, international wire, direct deposits, and bank transfers. However, keep in mind that 3rd party services such as PayPal may cause greater delays in your payment.
Airbnb also maintains a set of rules and regulations known as payment guarantees. Among these are assertions that guests have 24 hours to notify Airbnb of any problems they may encounter. If guests’ problems aren’t addressed, they will be able to complete their reservations and get a partial refund. Last-minute cancellation of reservations, misrepresenting listings, leaving your place unclean, and violating Airbnb’s hospitality standards all may result in refunds.