Boost your income with Airbnb
With The Rent a Room Scheme you can earn up to a threshold of £7,500 per year tax-free from letting out furnished accommodation in your home.
by Wendy Turner
We had a couple of friends doing Airbnb and it seemed fairy low maintenance and an easy way to increase our income. With the cost of living going up, every little bit of extra money helps. It was an easy decision for us as our five bedroom home was not being used to its full potential. My step-children were spending less time with us now they were older, travelling, going to university, and more of the house seemed empty. There was also another contributing factor – and in all honesty, life now is generally very expensive, especially if you want that extra holiday or some other significant treat. Also whilst owning a large Victorian home is something I’ll always be grateful for, it’s a constant maintenance project.
If you want to do Airbnb you need to own your home and live in an area that gets visitors. If you want to stay in your family home and have guests, like us, you’re effectively running a small-scale hotel, so it's not without faff and hassle – you need to be social and be happy to wash sheets and make some kind of breakfast. Obviously it’s not everyone’s cup of tea having strangers in their home, but for us it’s always been a pleasure. Alternatively, if you’re not in the property, you meet and hand over the keys. This is a great opportunity to help pay for your holiday. Personally the latter is not for us, but it’s very popular with my friends/colleagues who own their own homes in London and have large mortgages.
The first thing you need to do is decide what your goals are becoming an Airbnb host, and how much you’re willing to put into it, both in terms off time and effort as well as time. We decided that we didn’t want to have guests all the time but when we did we wanted it to be a real home-from-home experience and at a fairly premium price point. We have other friends who offer a more modest experience for less money but there is more competition in this space. Luckily our family home has everything that’s needed by guests and we pay for a cleaner on the day our guests arrive, so it’s fresh and spotless.
If you’re curious about how much you can really earn by becoming an Airbnb host, you can plug in your location, the number of guests you can host, and how much of your home you can rent out on Airbnb’s website and they’ll show you an average number. Of course, your true earning potential depends upon how much you charge for your space, and how often you can rent it out— both of which are ultimately dependent upon how much time and money you can spend on furnishing and maintaining your home. Charge too much and it’ll be likely that this will be reflected in the all important ‘Value’ rating. Airbnb’s algorithms are always telling us to reduce the price to improve occupancy but we seem to have found the right balance. You’ll know.
Having decided that we would be at the higher-end, we knew we’d need to do it well. This means good quality beds, Egyptian cotton bedding and towels, organic products, water in the bedrooms, wifi, courtesy drinks including alcohol and a delicious three course breakfast to meet anyone’s needs. We make a huge effort for the whole house to feel welcoming, even the garden. We also go out of our way to give local advice, lending out our bikes and even the odd lift here and there.
Someone starting out should think about three things: affordability, knowing your audience, and knowing your market. You get rated on overall experience, accuracy, cleanliness, communication, check-in, location, and value—and I find that value, even if you’re comparable to other places in your area, is the thing that people will most likely begrudge you if you’re listing at a higher price. These will all be reflected in your reviews and lucky for us is it is. With all our hard work and my husband keeping up to-to-date with the app and bookings, we are now Super Hosts. This helps generate more bookings by improved search placement. There are the requirements on becoming a Super Hosts below.
How to get your Airbnb price
When deciding how to price your house and what parameters to set for visits, the platform has a number of tools to help you. Airbnb’s metrics can show how your nightly prices compare to other homes in the area, or when you might want to consider lowering (or raising) your prices depending on the day of the week or expected surges in demand. You can also set minimums for the number of nights people can stay at your Airbnb—a weeklong minimum, for example, helps offset the cost of turning over the space, which will include cleaning and upkeep. You can charge for extra guests, or for any additional services you may want to provide, equipment rental, or city tours if you want to go all-out.
How you get paid for your Airbnb rental
Airbnb charges your guests before arrival, and they’ll release your money according to the method of your choice (like PayPal or direct deposit) 24 hours after your guest checks in. Airbnb host fees range from 3% to 5%, so the listing price that your guests see is higher than what you earn.
For us is it has been more enjoyable than we ever thought. We love the socialising and the cooking – turns out we’re feeders! We really have met some lovely and interesting people including a couple who simply wanted to escape their small flat in London, and nested in our dining room making plans for their wedding and reading our art books. We also hosted a family of seven going to a wedding and who didn’t leave our breakfast table for three hours as they soaked up each other’s company in the rare opportunity they were all together. These are to name but a few! There are also the guests that you barely notice are there – in and out in a blink of an eye before they head out to dinner, Glyndebourne or the Brighton marathon.
I think Airbnb will become a part of our lives now. Helping us to pay for those extra holidays, maintenance of the house or getting us out of a tight financial spot. We can also see it becoming part of our retirement fund in the future. I can’t believe those words just came out of my mouth!
Requirements on becoming a super host
Host a minimum of 10 stays in a year
Respond to guests quickly (within the hour)
Maintain a 90% response rate or higher
Have at least 80% 5-star reviews
Zero cancellations on confirmed reservations