If you are considering purchasing a property to rent through Airbnb or are debating converting a current long-term rental into a short-term rental, you're likely weighing the pros and cons of running an Airbnb in Middle Tennessee.
You’ve probably heard that renting properties through Airbnb, VRBO, or booking.com can be far more lucrative than long-term renting, which can be true but isn’t always so. Furthermore, even a successful Airbnb host may decide that the gig isn’t a good fit for their personality, lifestyle, and location.
So, let’s dive right in: what are the pros and cons of becoming an Airbnb host?
1.) Higher Income Potential
The first, most obvious benefit to choosing short-term rentals is that they bring in anywhere from 2x – 4x more money than comparable long-term rental properties. Just like hotel rooms, short-term rentals charge far more per day than a long-term tenant would ever agree to pay.
2.) “Bad” Tenants are Gone in Days
As any property owner who has had to evict a tenant will tell you: long-term renters have significant legal rights that make it an enormous, lengthy, time-consuming hassle to remove them.
A short-term tenant, even a bad one, will be gone in a matter of days.
3.) The “Airbnb Host Guarantee” Safeguards Your Space
Even if a short-term tenant damages or destroys your property, Airbnb will cover the cost of your damages. Having the backing of a successful, reputation-dependent corporation is reassuring in the face of the uncertainty that comes with a cavalcade of strangers passing through your rental unit.
4.) Diverse, Rotating Rental Base
Your Airbnb guests are likely to come from a variety of backgrounds, professions, and geographic locations. While it’s true that they’ll all be strangers to you at first, if you enjoy getting to know people, this fun facet of hosting can result in a cavalcade of new friends.
5.) It’s Easy to Keep an Eye on Your Property
Assuming you live close to your rental (which may be the only easy and safe way to be a host), short-term guests mean you’ll have frequent access to your property to ensure that it’s clean, well-maintained, and kept to your personal standards.
Long-term renting can make it a challenge to oversee your rental as often as you’d like, even if you do live nearby.
1.) Airbnb Renting Isn’t Permitted Everywhere
It’s vital that you make sure the ordinances in your area permit Airbnb renting. This is determined by local governments, which means the rules can change at any time. Even if short-term renting is legal this year, we recommend keeping a backup plan on standby in case your town nixes your gig in the future.
2.) Higher Costs
If you choose to rent your space as an Airbnb, it’ll be up to you to make it appealing to today’s travelers through upscale, fashionable furnishing and decorating choices. Because long-term rentals are usually leased as unfurnished spaces, these initial costs of renting as an Airbnb (and the cost of updating décor as needed), must be considered.
Additionally, the cost of internet, television service, and utilities will be your responsibility.
Going the extra mile by stocking a few food items like tea, coffee, fruit, eggs, snack bars, and milk (ask guests to choose animal-derived or plant-based ahead of time) can go a long way toward making a great impression.
3.) You’ll Spend More Time, More Often
In order to turn a serious profit on your Airbnb, it must be spotless—and you’ll be the person who will make that happen. Hiring a professional to come in and clean twenty or more times per month will eat up a huge chunk of your income, so consider the time and elbow grease you’ll have to put into your property if you want to succeed.
Do you want to wash linens, clean the kitchen and bathroom, sweep, mop, vacuum, and disinfect your property multiple times per week? Does your schedule allow for it?
Hosts are quick to point out that joining their ranks means that you’ll stop being a landlord and become a hospitality worker. Making this switch in mindset can be helpful when envisioning how your responsibilities will change.
4.) Expect Gradual Success
Even if you do everything right, your success in your chosen marketplace won’t happen overnight. It will take time to build up reviews, which are your digital reputation for delivering outstanding stays. If you require your rental income in order to remain financially solvent, the first few months of hosting may be a struggle.
5.) Your Property’s Income Will Vary Seasonally
Even after you’ve earned a great reputation, your income will still almost certainly vary seasonally. It will be up to you to determine how much you should set aside during lucrative seasons to carry you through dry spells.
As you ponder our list of pros and cons, examine your goals. What do you hope to accomplish with your additional earnings? Are you going to travel yourself, save for your retirement, or funnel cash into repairs on your own residence?
Keep your goal clearly defined and at the forefront of your mind as you consider the work you’ll be required to put in as an Airbnb host. Is this the best path for you? In the end, only you can answer this question with clarity.
Are you shopping for a property to rent out through Airbnb? Have a thriving portfolio you’d like to expand? Reach out to us at Parks Realty for savvy, expert assistance navigating the competitive, fast-moving real estate market anywhere in Middle Tennessee.