The short-term home rental platform Airbnb has grown popular over the years among travelers as an alternative to hotel accommodation.

Established in 2007, Airbnb, also an abbreviation for “air mattress bed and breakfast,” has skyrocketed to over 7 million Airbnb listings worldwide in 2022, according to stratojets.com. It is now present in 100,000 cities and 220 countries and regions with 2.9 million hosts.

The Airbnb success story is rooted in the unique way it connects the Airbnb host and Airbnb guests, offering the latter a deeper travel and local cultural immersion than what a hotel room can. It also provides Airbnb guests a range of lodging options since a rental property can be a big house, a studio apartment, sometimes even a yurt or a tiny house.

Short-term rentals and home-sharing demand also increased since the pandemic brought about the work-from-home set-up. With the rise of digital nomads, Airbnb has been hosting guests from beach fronts and near mountains. 


The Airbnb Business Opportunity

In the Philippines, Airbnb hosting has become a lucrative means to earn passive income especially among OFWs, millennials, and retirees. Anecdotes from Airbnb hosts in the Philippines say that monthly income for Airbnb rentals can range from 20,000 PHP to 40,000 PHP a month, depending on the location of your Airbnb listing. It can go higher for Airbnb a rental space near tourist attractions like the beach.

According to a survey by Philstar.com, Airbnb hosts this 2022 are able to allocate their earnings to cover food and necessities which have increased dramatically in the Philippines due to inflation. In the same survey, nearly “two out of five Airbnb hosts said they host to earn extra income to make ends meet, while over 50 percent said they host to earn extra spending money.” 60 percent responded that they also host to earn extra income to grow their Airbnb business. 

Whether you're still deciding on renting out your spare room or just listed a property you just invested in, here are useful tips for running a successful Airbnb property.


1. Compute, compute, compute.

Remember that the main goal of a successful airbnb business is to profit from your rental property. The first order of business of any Airbnb host is to sit down and run the numbers. Compute your mortgage, rent payments, monthly utilities, Airbnb fees, taxes, etc. You may only begin setting the price of your vacation rental property once you determine your overall expenses.
Be sure to compare your rental property to other nearby hotels in your area and not other rentals. This is because potential guests looking for accommodations will begin searching websites that will first show hotel prices of the surrounding area. If your Airbnb property goes lower or on par with hotel rates, you will likely be attracting guest looking for lodging with friendly and competitive rates.


2. Educate yourself about your city's local laws

Another essential pre-work of any Airbnb host is to research and educate himself about the local laws for short term rentals. Knowing the rules before you play is a good foundation of a successful airbnb business. Does the city require a business license or business permit before running a vacation rental? Is there a limit to how many nights per year you can rent your property? Is there a limit to how many guests can stay at a time in your rental property?


3. Work hard on your Airbnb listing profile

To run an Airbnb business successfully starts with a catchy but accurate description and details of your Airbnb property. Your listing description should include how many rooms and bathrooms can house potential guests, what amenities are available to use, are there nearby places of convenience and attraction, how many vehicles can your parking space accommodate?

It would be good to mention the main highlight of your Airbnb property (does it have a great view of the lake?) as well as the quirks (do future guests have to pass by a construction before reaching your Airbnb property?) so your guests feel safe and secure in their future stay at your Airbnb residence. A successful host always practices transparency to show they care.


4. Furnish Within Your Budget

Successful Airbnb hosts are great at attracting guests with unique accommodations with Instagram-worthy interiors. Part of the labor and fun of putting up an Airbnb property for rental is being able to decorate your rental space like your own home. That said, try to maintain a budget when shopping for furniture. A good practice would be to shop for furniture from second-hand stores or searching online for great deals. Guests are sure to appreciate a cozy home but that doesn't mean you have to break the bank. Furnish affordably.


5. Have a go-to cleaning service

Approach your short term rental business as a complete hospitality business. This means the cleanliness of your Airbnb property is top priority. When in doubt, hire a reliable cleaning service who can diligently come after guests checks out.


6. Work towards improving your host and property rating

Prospective guests rely on positive reviews when picking out a property to rent. Great reviews go a long way so make sure to work towards this. Get started by offering freebies and discounts to your guests in exchange for an honest review. Once you've collected great reviews as a host and good reviews about your property you will easily accrue those five star ratings and improve your search ranking.


7. Always be responsive to guest queries

You job as Airbnb host means committing to your guests. A huge responsibility of running a successful airbnb property is being able to respond to your guests quickly whenever they have queries and being able to quickly address any concerns they have. Other guests may be demanding more than others but as Airbnb host, you have to be able to make their stay comfortable. This will likely make you reap positive reviews.


8. Give the full Airbnb experience

Guests put value in the details Airbnb hosts put in their home. Stocking the pantry with essentials and cleaning supplies will be highly appreciated. Providing board games, books, movies, and entertainment options to ensure guests stay comfortably in your rental will go a long way. Make sure to provide condiments, coffee, tea and basic appliances. A good host will always go the extra mile to add in a free bottle of wine or a basket of goodies to thank their guests for choosing their property.


Key takeaways: Once you find your rhythm in being successful host, you can always expand your Airbnb business and make it a full-time job. Hosting is undeniably a great way to earn income if not more money. It is also a good way to expand opportunities like encouraging more travel of your own through the connections you make with guests.

Airbnb rentals have definitely become the go-to choice of accommodation of foreign tourists and local staycationers alike. As Airbnb guests, whether they go for short term rental or decide to be long term tenants of an Airbnb property, Airbnb guests are able to experience the genuine comfort of a home despite being away from home. 

Airbnb rentals also allow an Airbnb guest the total cultural immersion in a destination since many rental properties have already emerged in many cities in different countries. An Airbnb rental does attract renters exactly because it provides a new experience to a “vacation home.”  Airbnb is a real game-changer in international and local tourism. 

To real estate investors, investing in an Airbnb property has become comparably lucrative these days to traditional real estate investments. Despite the ongoing pandemic, Airbnb owners are seeing vacationers sign up on the Airbnb site for short-term rentals, if only to find reprieve from their usual environment. In the age of digital nomads and remote-working set-ups, an Airbnb investment property cannot be denied of its potential ROI, too.
 
But is an investment in real estate for an Airbnb all that? Before you get carried away with all the benefits you hear and decide on an Airbnb investment, allow this article to take you through the pros and cons of an Airbnb investment. 

 Pros of an Airbnb Investment
 

1. Any Airbnb rental easily spells PROFIT.
   
   
   A fully booked Airbnb rental with a high occupancy rate can mean a lot more profit to Airbnb hosts because renting the same property to long term tenants will allow an Airbnb host to charge more per night than traditional rent payments.
   
   
   
2. Boost your passive income with a single Airbnb rental
   
   Airbnb income from rental properties can conveniently become a source of cash flow for real estate investors if they go the Airbnb route. To first time property owners, an Airbnb investment property can amplify extra money. Imagine a single tenant signing up as a long term tenant for a single Airbnb rental. This easily beats the income you get from traditional renting.
   
   
   
3. Use your Airbnb rental property as your own vacation home whenever you want to.
   
   When your Airbnb listing is unoccupied, you can always choose to enjoy your own rental property as your second home. Reap the conveniences and comfort of your own investment property. As your own host, it would also be good to experience, first-hand, what your Airbnb guests state their guest reviews.
   
   
   
4. Be in full control of your Airbnb property
   
   Property management can be in your full control when you regulate short term rentals. Short term rent by new Airbnb guests staying in your property allows you to review the maintenance regularly even change up the interior designs when you want to. When operating your own rental properties you are also able to adjust the price of your rent during high season or when your Airbnb listings are seeing high vacant dates.
   
   
   
5. Choose your own Airbnb guests
   
   As a property owner renting a primary residence or putting up a vacation property for rent, you can be more selective of the people who will be renting your property. Reduce operating costs and make life easier for your maintenance crew by approving guests who have good reputation based on the Airbnb site.

With all that said, investing in an Airbnb rental is not just about boosting monthly income. The cons of Airbnb investing are also unavoidable. From high monthly costs to getting bad reviews from an irate guest, maybe investing in a primary residence for an Airbnb home might not exactly align at once with your financial goals. The pros come with the cons of Airbnb renting too. Consider these other factors:


Cons of an Airbnb Investment

1. Dealing with many guests of diversified portfolio
   
   There are risks that come along with renting a property to different people. Some may or may not pay rent on time, depending on their financial reliability. Owning several or single properties on Airbnb means expecting regular rent from different tenants on a regular basis. One tenant may wreak havoc on your monthly income by simply dodging one night's stay at your property.
   
   
   
2. High property operating costs
   
   Being your own landlord and maintenance crew, owning an Airbnb unit is a full time job. An Airbnb host's nightmare are usually incurring major property damages, and worse, thefts. With short term rental platforms, these are inevitable. To counter this however, Airbnb offers "host protection"
   
   
   
3. Being a one-man team
   
   Hosting a property or several properties on Airbnb means fulfilling the responsibilities of a one-man team. You are in charge of hiring a cleaning service or doing this on your own. You are also in charge of your own marketing. You have to have the right copy to describe your property as the right property for your future guests. You may also need professional photography to ensure your property stands out on the social media platforms.

Overall, Airbnb has, without a doubt, changed the real estate industry by disrupting average apartment rents and traditional rental scenarios. Whether a serious real estate investor or a newbie investor in real estate, venturing into Airbnb does have its rewards. The pros outweigh the cons if you work hard as a host and improve or use your financial literacy to your advantage.


FAQs
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What are the downfalls of Airbnb?

The downfalls of an Airbnb include high operating costs, regular maintenance, incurring property damage, and irregular bookings from guests during off season.


What type of property is best for Airbnb?

The type of property best for Airbnb boils down to the right property location. Locations with strategic access to top tourist spots, places of convenience and leisure are all surefire ways to book short term rentals. Ensuring that your property has a photogenic interiors can easily attract renters too.


Is it worth it to be an Airbnb host?

Investing in Airbnb offers a good source of monthly income and extra cash. It is a smart way to earn from investing in properties whether you are an OFW, millennial, retiree or anyone who wants to invest in real estate. It comes with its own pros and cons but if you are determined and work hard, investing in an Airbnb can be rewarding.