Is AirBnB a Good Side Hustle?
We’ve been users of the popular platform, AirBnB, for a long time. Everyone is familiar with it, but not everyone has taken advantage of using its “Host” feature to bring in a little extra cash. But we wanted to know if AirBnB is a good side hustle.
Full disclosure, we have been hosting on AirBnB for a number of years.
According to IPropertyManagement AirBnB currently has over 650,000 hosts around the globe. The average AirBnB host, offering a full 2-bedroom condo, is bringing in around $21,000 USD per year. That’s a good chunk of change.
So how can you get a sliver of that $8.5 billion industry? Well that’s what we wanted to find out.
Getting started was as easy as registering with AirBnB.
Once registered, simply click the “Become a Host Button” in the top right-hand corner of the screen.
Follow the prompts to list your first rentable space. AirBnB is flexible with what qualifies as a rentable space, but make sure you familiarize yourself with their terms of service first.
I’ve seen listings for everything from RVs to Igloos, even one host that was listing each area of a one bedroom plus den condo separately. That’s right, the den was $75/night, the bedroom was $100, and the pull-out couch in the living room was $45. I’m not sure if it was in keeping with the terms of service, but that host was definitely maximizing the condo’s potential. As always, it’s important to play by the rules though, as breaching the Terms of Service could result in a ban from the platform.
Once your listing is live, it’s easy to set your calendar to your available dates and let the cash roll in.
AirBnB let’s you set your own price, or let its algorithm set a competitive price per night for you. We opted for the latter.
Our First Guest
Within 5 days of posting our home on AirBnb, we had our first booking. This pattern repeated itself whenever we opened our calendar on the AirBnB Dashboard. Our average wait time for a booking was 3 and a half days.
I found the arrival of our first guest to be somewhat stressful. We opted to clean the house ourselves in anticipation of their arrival. As we were renting out a lived in space, we had to ask ourselves, and find answers that we were comfortable with, to the following questions among others:
“When is clean, clean enough?”
“What do we do with our personal belongings?”
“Do we provide bathroom necessities like shampoo?”
“Do we give them access to the food in the pantry?”
Ultimately, we took a low-key approach to hosting. Clean enough was when I felt comfortable enough for my mother in law to stay at the house. We replaced the lock on the master bedroom door and left all of our extra stuff in there. We bought small containers of shampoo and conditioner and left those out for our guests, and generally, left them with free-reign of our pantry.
As our rented space was our own home when we were out of town your mileage will vary if renting out a space exclusively for AirBnB guests.
I have been very happy with our results. Over the years we have rented out our space on 5 different occasions.
The resolution payments you see above are times where the guest cancelled at the last minute. Due to the nature of the cancellation policy we had in place, we were entitled to retain the deposited amount.
On one of the other occasions, our guest failed to show up, but paid the full amount. There is another payment of $230 on a different account, bringing our grand total to $870 for about 6 hours worth of work.
That’s an average of $145/hour!
AirBnB is a Good Side Hustle
Space sharing is a lucrative side hustle with a lot of possibilities. If you have a spare room or two, renting them out is a no brainer. Looking at the average rental price of a single room in shared accommodation in my area ($40/night) and assuming 60% of the year is booked, an AirBnB host can make $744/month easily.
That number increases significantly if you are renting out an entire space. The average “Entire Place” rental in my area goes for $85/night. Based on the same capacity above, that’s an average of $1581/month.
AirBnB scores a High in Viability.
There are some barriers to entry. First and foremost is the requirement that you own the space or have permission from your landlord, which most landlords will be hesitant to provide.
This means that in order to reap the benefits of your spare room, you also have to be paying for the maintenance of the property, property tax, insurance, etc. If you’re living in the space full time those costs are being paid regardless of your side hustle, but if you have a spare property sitting idle, those costs should be included in your assessment of the financial feasibility of your business.
Factors such as cleaning and potential property management should be taken into consideration as well. Those are costs in both time and/or money. Many vacation rental management agencies exist and in exchange for a small percentage of your revenue will maintain the property and listing on your behalf. I’ve seen agencies listing their services for anywhere between 10-30%.
AirBnB scores a low on Affordability, unless you own a property, or multiple properties, already. In which case it scores a High.
How scalable your AirBnB empire is is entirely up to you. In tourism rich areas your rental income can bring in enough to invest in multiple properties, or you can simply use it to pay off your mortgage. Either way, vacation rentals can meet your income goals regardless of whether they are a few hundred extra a month or a few thousand. As scalable as this hustle is, it will never net you millions, not unless you have hundreds of properties at your disposal.
AirBnB scores a Medium for Scalability.