Over the past couple of years AirBNB has become a household name, and has caused great waves in the hospitality industry. While this may not be great news for motel and hotel owners, this has opened up many doors of opportunity to our clients.
There are investors that have started to rent units specifically for the purpose to rent them out as AirBNB units, and a lot of them have been making +100% returns on their rent! Being open minded and adventurous, we’ve decided to give it a try ourselves and have been quite pleased by what we’ve found.
Here’s what we’ve learned so far.
In Tomah, WI, we have a 10 unit complex with a mix of 1 bedroom and studio apartments. These were renting at around $450-500 for our year long leases, so we figured these would be low risk apartments to test the AirBNB market.
For our AirBNBs we fully furnish them and try to include as many of the amenities that AirBNB recognizes as possible, this is a way for us to optimize these listings to rank at the top of the AirBNB listings for the area.
After about half a year we have found the units renting at $450-500 are now consistently grossing around $850-900, and we’ve had some months where they rent for over $1,000. Of course there are cleaning costs and operating expenses, but on average these cost around $100-200 per unit each month.
We’ve found a market of short term 1-6 month lease inquiries for these units, as well as the typical nightly stay. AirBNB Guests also seem to have realistic expectations and are generally impressed by the level of care we put into our units. We aren’t doing anything special or providing any above average services, we just ensure the units are clean and have all the amenities we claim on the listing.
