Congratulations on your interest in using Airbnb as a smart investment strategy.
Airbnb, as in “Air Bed and Breakfast,” is a service that lets property owners rent out their spaces to travelers looking for a place to stay. Travelers can rent a space for multiple people to share, a shared space with private rooms, or the entire property for themselves.
Airbnb was started in 2008 by Brian Chesky and Joe Gebbia, two industrial designers that recently moved to San Francisco. Unable to afford the rent for their loft at the time, the pair decided to make up the money they needed by renting out their apartment to people who couldn’t find hotels to stay at while attending nearby trade shows. They set up air mattresses in the apartment’s living room for their guests to sleep on and cooked homemade breakfast in the morning. Since then, Airbnb has become one of the trailblazers of peer-to-peer property rental.
What Do They Do?
Airbnb is based on a peer-to-peer business model. This makes it simple, easy to use, and tends to be more profitable for both parties. The model also gives you the opportunity to customize and personalize your guests’ experience the way you want.
Who Books on Airbnb?
Knowing your demographic is imperative when deciding on a new booking site. The general traveler booking on Airbnb will be a young, tech-savvy millennial; it is estimated that millennials account for roughly 60% of all guests that have ever booked on Airbnb. These travelers are particularly attracted to authentic, local properties. They believe accommodations listed on Airbnb will provide them with more cultural experiences, which is a top priority for them when they travel.
Its popularity stems from the fact that not everyone who is traveling can afford to stay in a hotel, much less find a hotel room in a busy, urban area. Airbnb provides them with a simple — and often less expensive — alternative.
How Airbnb Works for Hosts
Whether you own a bed & breakfast, an apartment, house, block of units, your reservation system can be integrated right into Airbnb. Many of these integrations will sync content, rates, and availability, so you can manage your content on Airbnb. Plus, your bookings through Airbnb will flow right into your booking engine! If you are already using Airbnb, some of these platforms will even let you sync your existing Airbnb listings, so you don’t lose your host ranking and status.
Airbnb Hosting FAQ
WHAT IS THE COST?
Airbnb charges a service fee, usually passed on to guests, or incorporated in the daily rate paid by the guests, payable by the host. Cosy Stays can explain in more detail, as well as management fee’s and other associated costs to consider.
HOW DO I GET PAID?
All payments are processed securely through Airbnb’s online payment system. Guests are charged when a reservation is made, and hosts are paid 24 hours after check-in. Management companies will generally hold funds in a trust account, and pay out the property owner monthly deducting any costs incurred to manage the property, such as maintenance, management fees etc.
DO I NEED TO LOWER MY RATES TO BE COMPETITIVE ON AIRBNB?
On average, rates for an entire home on Airbnb are the same or lower for the cost of a single hotel room. However, there are luxury properties listed.
If you’re thinking about being a host, keep in mind that you must provide Airbnb a minimum of 30 days of availability over the next 12 months for each listing. Make sure the rate type you associate has pricing for at least 30 days for each listing.
AIRBNB HOST RULES
There are also some basic Airbnb host requirements:
- Provide guests with a least the essentials, if not more. You must include toilet paper, soap, sheets, and at least one towel and pillow per guest. It is up to you to provide anything else; we suggest adding a little something extra to get a good host rating!
- You must be responsive. Reply to inquiries and reservation requests within 24 hours of receiving them.
- Accept all reservation requests promptly. The sooner, the better!
- Do not cancel. Airbnb takes host cancellations very seriously. They understand that travel plans depend on accommodations, so cancellations are highly frowned upon.
- Keep a consistent, high level of quality to achieve a high rating.
Make Sure You’re Getting the Most from Your Marketing Strategy
Now that you know how Airbnb works for hosts, it’s time to find out if it’s best for you! Cosy Stays, as airbnb property managers servicing Sydney, Melbourne, The Gold Coast and regional suburbs in between, we have the perfect solution to ensure your property is working harder for you. Contact us today to learn more on how we can assist you.