10 Reasons to Invest in Airbnb
In today’s sharing economy, Airbnb is extremely popular and investing in a short-term rental property can be a successful strategy for providing a lucrative income.
According to a report by PricewaterhouseCoopers, the world’s sharing economy could reach $335 billion in global revenue by 2025. And, next to Uber, Airbnb is the second most successful sharing economy company in the world.
Join the sharing economy
Digital platforms like Airbnb have unlocked potential revenue streams for short-term rental accommodation as well as a culture shift for on-demand services. As more people adopt this lifestyle, supply from property owners and Airbnb management companies will continue to increase to meet demand.
Considering taking the plunge?
There are many benefits to buying an Airbnb property. Here are 10 of the top reasons we think you should consider this real estate investment.
- More lucrative than long term rentals
A fully-booked Airbnb property may be more profitable than renting to one long-term tenant because you’re able to charge more for bookings on a nightly basis.
- More security
For short-term rental properties registered with Airbnb, hosts are offered more protection with AirCover. This top-to-bottom home coverage is free to all hosts on the platform and offers up to $1 million in damage protection and $1 million in liability coverage. This also includes income loss protection, pet damage protection, and deep cleaning protection.
- Endless thirst for experiences
Unique Airbnb short-term rentals are ready for guests to experience something different, and the desire for consumer experience is robust. Guests want seclusion, romance, and rustic or idyllic settings or, on the flip side, an opportunity to integrate with communities and immerse themselves in local culture. Airbnb properties are often perfectly placed to meet this demand.
- Lifestyles are changing
The ever-growing shift to flexible working hours and work-from-home opportunities means more people can prioritise travel. For those working remotely, then working from anywhere, including an Airbnb property is far more viable.
- Faster return on investment
When you consider higher occupancy rates with the higher rates realised in the short-term rental market, you could drastically increase the rate at which you pay off a home loan.
- Value appreciation
In addition to making money in the short run, short-term rental homes also make money in the long term. Real estate generally appreciates over time, especially those that are well maintained like an Airbnb property frequented by discerning guests.
- Less risk
Investing in a holiday rental exposes you to lower risk because properties are generally in top tourist destinations where they’re likely to attract high occupancy and high nightly rates. Because of this, rental income is high and, of course, that’s how you as an investor will make money.
- Help at hand
Airbnb management can be a full-time job, particularly if you want to maximise your investment. Imagine having a 9 to 5 job and still having to clean the property, wash linen, meet guests, respond to booking enquiries and ensure everything’s in tip-top shape and ready for guests at the drop of a hat.
Instead of handling it yourself, you can pass the reins to a specialised Airbnb management company to do all the dirty work for you. The better your property is managed, the more likely you are to achieve Airbnb’s Superhost Status, and this can make a major difference to your income potential.
- Somewhere to escape to
Running an Airbnb property also offers flexibility for property owners. When bookings and occupancy are carefully managed, you may even find time in the off-season to enjoy the property yourself.
Adding Airbnb to your income-generating portfolio offers diversity to your assets. It helps mitigate risk and protects you from market volatility. It also offers you the benefits of an established online short-term rental marketplace, such as Airbnb, making it easier to advertise and rent your property.
People will always want somewhere to stay on holiday. If you have the right property in the right location, you will do well. Just keep in mind that for your short-term rental investment to build wealth for your future, your goal should be for both your capital and rental values to increase over time.
Thinking of listing your property on Airbnb, but not keen on the day to day chores associated with it? Or just want someone else to manage your property? Give us a call on 086 111 2842 or email the team at firstname.lastname@example.org and we’ll send you our information pack immediately.
- December 20, 2021
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