Investing in an Airbnb can be an exciting process. But with so many factors to consider ahead of time, it can be impossible to know where to begin. Whether you are new to the world of property investment or an established real estate mogul, you must weigh up the pros and cons before making an informed decision. Continue reading to find out what you must consider before jumping aboard the latest home-sharing trend.
- The current real estate market
The real estate market can be infamously volatile. Before you invest your time, effort, and money into an Airbnb property, you must ensure you have at least a basic understanding of the current real estate market. You should research a rough ballpark figure of how much profit you are likely to make as well as how long this is likely to take. If your local area is experiencing a rapid surge in tourism, getting a head start on the real estate market and investing in an Airbnb could be a great way to double your income. An Airbnb in Bristol, one of the country’s most popular city break destinations, for example, may be booked by tourists looking to immerse themselves in the local medieval architecture, thriving music scene, or street art culture. To invest in an Airbnb in Bristol, you should research the current real estate market to find out whether this would be a viable option or whether you should continue your search elsewhere.
As with any investment opportunity today, you must budget accordingly beforehand. This includes deciding how much you are willing to spend as well as factoring in any additional property-related costs. If you are financially unable to purchase an Airbnb property in cash, you may be required to take out a second mortgage. On top of that, you will have to splash out on fixtures, fittings, and soft furnishings to ensure your Airbnb is attractive to prospective holidaymakers looking for a place to stay online. You must also consider how much it will cost to secure and operate the property. This includes internet, television, water, electricity, insurance, and tax.
As well as researching the current real estate market and determining a budget, you must also decide where you want to buy. If you live in an up-and-coming city, an Airbnb nearby can not only guarantee a return on your investment but allow you to be involved in the entire process from start to finish. You must also consider whether or not you are likely to have neighbours and how they might react to having a brand-new neighbour each week. This can vary depending on whether you are looking to buy in a city or in the countryside. To boost your prospects, you should consider purchasing a property near key transport links.
When it comes to investments, none demand more time than that of real estate investments. Unless you hire a small roster of dedicated staff members to maintain your Airbnb property, you must ensure it is kept clean and tidy between bookings, check guests in and out, restock amenities on a regular basis, respond to guest enquiries around the clock, deal with complaints, and carry out any minor repairs. If you have a full-time job or have your hand in many pots, an Airbnb investment may not be the best option for you. If you only work part-time or are retired and are looking for a secondary income stream, an Airbnb could be a viable investment.
- Local laws and regulations
Each city is subject to laws and regulations that govern how, when, and where Airbnb can operate. You must familiarise yourself with these rules before you submit an offer. For example, zoning laws will determine whether or not a certain area can be used for residential, business, or dual use. Even if you are permitted to purchase an Airbnb property, you may be required to obtain an additional licence in order to rent out the space.
When it comes to investing in an Airbnb property, access should be one of the first factors you consider. If you are purchasing a property in a different neighbourhood to that of your own, a self-check-in and check-out box could allow overseas guests to arrive and get settled in at their own leisure. In today’s digital landscape, most tourists prefer automated processes as opposed to manual processes.
Airbnb investment has surged in popularity in recent years. With a wide range of benefits for you as well as your guests, it could be a great way to boost your income. But before you seal the deal, you must consider a number of important factors. This includes the current real estate market, budget, location, time, local laws and regulations, and access.