Should I Turn My Home into an Airbnb?
By Megan Morrow
Published April 22, 2019
With more than 4 million listings worldwide in nearly 200 countries and 65,000 cities, Airbnb
averages about 500,000 visits each night. You may have stayed in an Airbnb property on a recent vacation or heard about friends who list their home or a portion of it on the site or something similar.
Essentially, Airbnb and other rental sites allow you to make money – to help pay your mortgage or decrease your time until retirement, for example – when you are away (or while you are at home, if you choose to rent out a single room or guest house, for example). But is the earnings opportunity worth it?
If you are considering adding your home to the growing list of Airbnb properties across the globe, first consider the following:
- Ask yourself: Am I really comfortable with strangers staying in my space? Ultimately, not everyone can readily tolerate this facet of home exchange. If you are, determine what would be off limits and how you can secure valuables and personal mementos. It is also important to recognize the potential time commitment that preparing your property and eventually renting it out will entail.
- Examine the legal ramifications. More and more cities now require special licenses or registration before homes can be placed on sites such as Airbnb. Do your due diligence to ensure that you will not be in violation of any insurance policies or homeowner association policies. It is recommended to call your insurance company ahead of time to determine what is and is not covered. Finally, if you move forward, ensure that you report any rental income when tax season arrives.
- Consider your neighbors. If you have neighbors sensitive to the slightest disturbance OR neighbors who are particularly boisterous themselves, then you may want to keep your house to yourself.
- Plan for professional cleaning. Guests will expect a spotless place to check in to, so ensure that you have a contact of a local cleaner who is available on-call.
If you are curious what your space might draw in daily rental, you can check out the Airbnb calculator for a better idea of potential earnings. If you choose to list your property, focus on being a good host: offer a spotless space with an extra set of towels and linens, provide clear check-in and check-out instructions, and share some of the fun aspects of your city or neighborhood with renters.
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The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.