Pros and Cons of Buying a Home for Airbnb

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.