We reported at the end of 2020 that Airbnb (NASDAQ: ABNB) bookings have more than quadrupled over the past five years. Clearly people are using and making money with this short-term vacation rental platform. But like plenty of other industries, the short-term rental business was hit hard by the coronavirus. Second-quarter revenue for 2020 was down 67% from the same time in 2019.
If you're an Airbnb host (or want to be), you can still be successful -- people are getting sick and tired of staying home. You just need to know what might be different now and how to address it. Here are four action items to take in 2021 to make the most of your investment.
1. Location, location, location: Choose a good one
The real estate mantra of "location, location, location" referring to primary residences goes for the short-term rental business, too. Regarding Airbnb, it's a good idea to choose, now more than ever, an attractive yet affordable locale: affordable so you don't break the bank on a possible risky venture (we still don't know how much Airbnb will bounce back), and attractive -- that's always a must for enticing an Airbnb crowd.
You can get help choosing a good location by working with a real estate agent who can help you locate and find the hottest neighborhoods and vacation spots.
Or you can use an analytics tool. AirDNA provides short-term rental hosts with vacation rental data. This analytics site shows the active supply of vacation rentals and the revenue being made. CBRE Group (NYSE: CBRE), a commercial real estate services firm, found the site 97.5% and 96.2% accurate in these regards, respectively.
2. Market your Airbnb as a ‘staycation'
Although people aren't flying as much these days, they're still driving. It makes sense to hit your local market. The "staycation" phenomenon is big right now. Many people, stuck at home too long, just want a change of scenery.
Get to know what your Airbnb town has to offer. A funky art district? A family-style brewery? Plan an outing and market it.
Another draw for domestic traveling guests is to offer an unusual or novel experience, such as staying in a tree house, barn, or cottage, perhaps. And, of course, if you have a great lake, beach, or mountain view, plenty of people probably want to stay there, from the working-from-home types to girls' night out groups.
3. Be creative with your listing
If you haven't been creative before with your listings, now's the time. For the heading, you can use something like what some guests have done, such as "Elegant Art Deco Home with Garden," "Luxury City Center Loft on a Traffic-Free Street," or "A Cozy A-Frame in the Redwoods."
In the same vein, make sure to promote all the services your guests can enjoy. Play up what makes your property special and its amenities. It might not sound flashy, but people appreciate free parking and in-house laundry, for example.
4. Implement hygiene protocols
These days, people have a raised awareness about hygiene. They want to stay in a place that's as germ- (and coronavirus-) free as possible. You can make guests feel more comfortable, which translates to more likely to book your place, if you have a system to disinfect your Airbnb.
Airbnb has implemented a five-step enhanced cleaning process for hosts. It includes everything from airing out the space to how to properly clean and sanitize each unit. Some hosts, because of the extra expense involved in the upgraded cleaning procedures, add a cleaning fee to the rental cost.
The Millionacres bottom line
Although Airbnb took a hit when travel tanked, people are still making money using the platform. It might not be as much a no-brainer as before, but if you have a plan and a market in mind, you'll have a better chance of success.