Over the last few years, rental websites like Airbnb and VRBO have become go-to options for travelers looking to break out of the traditional hotel chains. As the options have diversified, the rental market has become reinvigorated with new interest in unique experiences and freedom from a mortgage.
Whether you already have a space or you’re just beginning to research a real estate investment, we’re here to break down everything you need to know about earning additional income from renting.
Know Your Numbers
It’s no secret that there are a lot of factors to consider before investing in a property. Can you afford a down payment? Do you have enough saved to cover any unexpected costs? Here at The Everygirl, we’ve previously covered the five questions to ask before buying, and we also broke down the differences between buying and renting, but there are additional expenses to consider before opening your space to renters.
Start Up Costs
Whether you’re renting out a furnished room or a brand new property, you’ll undoubtedly have some expenses to get it ready for renters. Furniture, appliances, and amenities like an Internet modem or cable box should all be accounted for in your upfront cost.
Your mortgage isn’t your only monthly commitment. Plan your expected utility and Internet expenses up front so that you can be sure you’re covering your costs with your rental income! If you’re eyeing Airbnb for a fast-paced turnover of renters, don’t forget the cleaning fees (your own time or a service) and the replacement of amenities like shampoo, soap, and coffee.
Research the Market
Not all cities are created equal. Now that you know what you’ll need to bring each month to cover your costs, confirming that the price is competitive is imperative before diving in.
There are dozens of rental market reports available online, but if you have a specific neighborhood in mind, there is no better tool than AirDNA. With a quick city search, you can dig into the average nightly price, the occupancy rate, and what the current selection of rentals looks like in the neighborhood; how many bedrooms, what kind of amenities, etc.
Before moving forward, make sure that your break-even price is viable in the market. Skim through the rental listings on HomeAway, HotPads, or Zillow to see how your vision stacks up against the current options for renters.
Market Your Space
Great photos, descriptions, and a social media presence can take an average rental and turn it into a sold-out Internet darling. Properties like The Kutcher Condo and The Joshua Tree House have devoted Instagram followings and beautiful websites that set them apart from the competition.
Put away your iPhone and borrow your friend’s DSLR camera to capture your space in the best light. The more photos, the better — highlight the full space with wide angle shots, but don’t forget the unique details as well. Whether you’re targeting short-term travelers or a long-term lease, great photos are the best way to attract interested renters.
Think of your listing as a product you’re trying to sell and employ your best copywriter voice to tell people why your property is the best option. Be sure to answer every question a potential renter may have; some information about yourself, the property, and the surrounding area are all key.
Cabin Cabin Cabin has a great combination of traditional as well as Insta-worthy detailed photos, combined with an in-depth description that gives travelers all of the information they would need to click “Book.”
Welcome Your Guests
Whether they’re staying a night or for six months, all guests enjoy a warm welcome when they arrive in a new place — especially if they’re new to the area. No matter what your skill set is, there’s a way to make sure that your renters feel at home.
At the very minimum, you should have a sheet of paper with key information and contact numbers waiting on the counter.
Check-in and check-out times, login information for the Internet, guidance for using the TV, and phone numbers for the property manager and a local taxi company are all must-haves!
The Next Level
Websites like Hostfully and Coral allow property owners to create beautiful digital guidebooks to provide guests with restaurant recommendations, public transportation directions, an amenity overview, and your “house rules.”
If you’d rather DIY a guide, everything from Squarespace to Powerpoint can serve as free platforms to create beautiful tools for your renters.