It’s the end of the year and New Years Eve is only days away. I had a last minute guest cancellation for NYE. I took this as an opportunity to increase my price for the night. It was booked again within an hour for a 50% higher price. Clearly there is a last minute rush to find a room and that is when you can really get that extra profit.
Reducing your prices can start a cascade of bookings
December I find is a quiet time of year and usually so is early January. At one point during the month I reduced my prices by 20% to avoid being empty, the first time I have done such a thing in as long as i can remember. Reducing prices instead of being empty is sometimes the best thing to do. I am very much of the opinion that bookings usually follow other bookings. By this I mean that if you reduce your prices to get a booking the airbnb algorithm will see you got a booking and therefore promote you further as usually this means more bookings will flow. Its a virtuous circle.
Warn your guests from overseas about Christmas
It seems every year I have a guest who seems to not know the consequences of being in London on Christmas day. A guest from South Korea arrived at my house on boxing day. I had already warned him when he booked that the 25th of December is a public holiday and there will be no public transport and that most of London will be closed. When I spoke to him he started asking me about how he can get to the British library. I explained to him that there is no public transport and even if there was public transport the British Library would be closed! He seemed extremely surprised. I guess some countries so not understand the enormity of Christmas day in the west.
It’s nearly October in London and it’s gotten much busier now that summer is nearly over. Over summer I had plenty of bookings but I was not 100% full. Since the start of September I have been full every day and with higher prices that July or August. I recall this being the same last year also. Most of my airbnb customers stay only one or two nights. This means more bed sheets to clean and more hassle checking in and out guests but I prefer this to having empty listings. In previous years I used to keep my prices very low to ensure I get plenty of guests but now I think I don’t need to do this as much as I have over 600 reviews. Having so many reviews gives people confidence they will be getting what they are paying for.
Can you get an Airbnb Mortgage?
As far as i’m aware there is no such thing as an Airbnb mortgage and I think it’s highly unlikely there will ever be. Despite what you may have heard from friends or from some get rich seminar you can’t walk into a bank and borrow huge amounts of money on the promise you will run a very good airbnb with the money. Now more that ever banks are under very strict rules of what they can lend to who. Unless you have a large provable income you won’t be getting a mortgage that would allow you to buy an property for an airbnb business. The vast majority of airbnb hosts who let whole apartments are using the standard buy-to-let mortgage and have not told the bank they are letting on airbnb.
Superhost secrets – what REALLY gets you more bookings on Airbnb
There are lots of blog posts on the internet giving tips on how to be a great airbnb host and how to get more bookings etc. Most have pretty much the same content. A good example is this blog post on the airbnb website (presumably the content is acceptable to airbnb and factually correct so bear that in mind). But a lot of this stuff is not overly useful unless you can actually get someone to book your listing. Your place might be amazing but if nobody books it the world will never know.
So here is my advice on how to get more bookings and be full all the time: –
Be good value for money. Or in other words be ‘cheap’. Everyone wants a bargain and you can be that the cheapskate in everyone will usually win out. Be at least a pound or two cheaper than your nearest rival.
Have lots of reviews. People want safety of choice. There are no instantly recognisable brand names when it comes to listings. If you have lots of reviews (and I mean hundreds of reviews) you become a ‘safe bet’. Get more reviews by getting more guests so be willing to accept a smaller amount of money and more short term guests to get those reviews stacked high.
Be flexible. Accept short term guests. So many of my guests are one nighters. This may seen like so much more trouble (and it is) but since so many people have a 2 night minimum stay you will never have an empty listing.
Have professional looking pictures – both of The Listing and Yourself. Use the airbnb photographer to get professional looking pictures done (also they become airbnb verified). You might seriously want to have a nice clear professional picture of yourself in your profile. Not a picture of you trying to look cool at some party, a proper professional picture like you might see on Linked In. If you look like a joke then you can’t expect to be taken seriously.
It’s September in London and Summer is drawing to a close. Like every year so far the July and August period has been slow. It’s unusual for me to have empty listings so I really notice the difference. I believe things are now picking up as i’m full for the next few weeks. The prices I have been charging for my airbnb listings are higher this year than in previous years but only by a small amount. So far no great wealth has flowed from airbnb for me but it has paid my mortgage and then some.
Should you pay for the official Airbnb Photographer?
When I started doing Airbnb nearly 3 years ago the airbnb photography was free. You simply used the online link and then a photographer was sent to your listing and usually did a very good job of the photography and a week later your listing looked beautiful on the website and more bookings flowed from it.
I have 4 listings and three of them had the free airbnb photographer. When it came time for the forth listing to have its photo’s taken all of a sudden I started receiving the message “no photographers are currently available in your area” from airbnb. I kept trying and got the same message until eventually I forgot about it. I recently tried again and was told that I needed to pay £77 to have the photo’s taken. So is it worth paying for the official airbnb photograher?
The advantages of the official photography are twofold. First you get excellent professional photos of your space usually much better than you might ever take yourself. Second your photos become ‘verified’ which means your listing should rank higher in the search results. If your expecting to be a airbnb host in the long run it must be worth having the official airbnb photos.
Why you must use Instant book!
It seems now that airbnb will automatically apply the Instant book filter whenever someone is searching for a listing in the immediate future. So if someone is looking for somewhere to stay tonight or maybe tomorrow then when that person searches in airbnb it will show only those listings which are ‘Instant book’ ready.
So if your listing is not instant book and your hoping to fill a last minute vacancy then your chances of getting a booking just dropped through the floor. Anyone who is searching for a last minute airbnb deal is going to go for those places which are instant book ready; as time is short. So you could be losing your best deals by not being instant book ready. I find I can charge much higher prices on last minute bookings (sometimes 50% higher).
This is only for new users of Airbnb. As far as I know there is no easy way to get free travel credit if your already a registered user of airbnb. If you have not linked your account to Facebook it is possible that you can sign up with a new email address and get another £30 free credit.
There are terms and conditions such as that you need to make a booking of £55 or more the use the free credit. The amount of the free credit has varied from time to time from as low as £15 to the now high £30. There is also a bonus for new hosts but this has been wound back recently. It was the case that if you referred a new host that you received £90 in cash from Airbnb but again this has been wound back and you now get £55 in travel credit.
It’s now May in London and it’s finally gotten warm like summer. I no longer need to keep the radiators bering all day and night to stop my guests complaining about being cold. Its been steadily busy the last few weeks. I have so many regular airbnb guests now (those that come almost every week to London, usually for work purposes) that I feel the slowdowns in bookings much less than previous years. I read a newspaper article recently that more tourists are visiting London than ever before so I expect most hosts are doing quite well.
Getting a mortgage with Airbnb
Recently I applied to re-mortgage my house. I was set to re-mortage with Santander and the deal was almost complete. The final hurdle was the usually quick and easy valuation of the property the bank does to make sure the house is worth what you say it is (in my experience they always value the property at exactly what you say it’s worth). I was not expecting any problems as my house is relatively new and in central London. I did not tell Santander that I run an airbnb business from my home. I felt it would not add anything to my application (current attitudes are to airbnb it seems is earning more money makes you a bigger risk, go figure?) so I didn’t tell them.
The valuation expert who visited my house reported back that I was running a bed and breakfast in my attic. There we no guests staying in the house at that time (some were due to arrive later in the day). So I was first amazed about how he knew this and secondly why he had reported this as it was in my opinion not his job to report on such things – he is supposed to be an independent expert to value the property. Santander refused my mortgage on these grounds. I later heard that the valuation expert had seen the bottles and water and chocolates placed by the beds.
Getting a mortgage for an airbnb is still an issue. Airbnb is seen as a commercial business and would therefore require a commercial loan. It does not seem even possible that anyone could use airbnb on a residential application for their own home. The ability to earn extra income to help pay the loan you are taking out to me seems like an excellent safety net. Most people rely on their employment income to pay their mortgage which is nowadays not so secure and reliable. Having a second income should make an application stronger but this seems not the case. How long will it be before banks change their attitude? I think not until they are forced to.
How to Automate your Airbnb
For me the worst thing is when a Airbnb guest arrives at your house early and your not at home. You may have no choice but to drop what you are doing and rush back to let your guest in. This is something that has happened to me on a few occasions. More often I plan to go out but a guest is booked to arrive later so I have to wait until they arrive before I can leave the house. So now I automate my airbnb in two ways.
Install a Keysafe outside the house
Install a intercom on the door that can call your phone
I bought a police approved high quality key safe and bolted it to the wall near my front door. It’s not visible from the street and has a protective cover so it looks like a wire box or something like this. A set of keys can be placed inside the box and a special code is needed to open it. Therefore if you can tell your guest the code and how to find the key safe they can enter your airbnb when your not at home.
For a long time I wanted to buy an intercom for the front door which would tell me if someone rang the bell and allow me to speak to them from my mobile phone. I understand the likes of Apple plan to develop such a device but have yet to do so. There are many such devices on the market already but none especially stand out. I was waiting for a reliable high quality intercom to hit the market for some time but so far none have appeared. Not willing to wait any longer as I was occasionally having trouble with guests arriving at my house but was not able to reach them on their mobile phones. I did purchase this intercom from Ring. It does work but if your in a area of low internet connection it can cut out easily.
So now It is possible for a guest to arrive at my house and they can speak to me on my intercom when I’m not at the house and I can tell them how to get the key from my key safe and they can get in the house without me being home. So I no longer need to rush home across half of London to answer my front door.
It’s March in London and we just put the clocks forward one hour which means only one thing – spring is on the way. We are now out of the worst of the Airbnb low season and things are already picking up. I’ve had several bookings as far in the future as August but still most of my reservations come in less than a month before the actual booking date.
Airbnb Guest Review ‘Issue Categories’
I’ve noticed that the guests reviews now reveal the actual number of stars you received (it’s between 1 and 5 stars). When I first started hosting this was not actually revealed to you. The only way to know for sure what star rating each guest left you was to keep track of the number of stars you currently had before the guest arrived and check it after they left and then do the math. This new system does make the whole thing easier to follow and can alert you to issues you may have quicker.
If a guest leaves you less than 5 stars for any category (cleanliness, check-in, accuracy etc) then they have the opportunity to be more specific on what was not up to standard. My main negative feedback point is LOCATION and SIZE OF HOME. These are not a surprise to me as the area I live in although is relatively close to central London the street do look a bit shabby. The other issue is ‘size of home’ which I can only guess is because the guests are sometimes surprised that I have more than one room in my house on airbnb and either it feels less private, or less safe.
Adding a Airbnb Co-Host
For those Airbnb hosts who are just too busy to stay on top of their bookings a co-host could be very helpful. And more importantly can help avoid income tax. If like me you get booking requests and guests questions at the wrong time of day (in my case when i’m asleep) then a co-host could be the answer. I currently do not use a co-host but I like the idea and may start using it soon. My wife would be my obvious co-host but it may make sense to have someone else you trust but who has very different financial circumstance.
To all those people out there who think the money you make on airbnb is not liable for income tax you are 100% completely and utterly WRONG. In fact ALL earnings must be taxed – except in certain circumstances. Yes there is the rent-a-room allowance (currently £7,500) which is free of income tax but beyond that your going to have to pay. That is unless you can shift the income to someone else who is already not using their full tax free threshold (currently £11,500 a year). Say a stay at home relative who has no other real income. Someone who you can co-host with and pay them for the excellent service they are doing for you (or pay them anyway even if they do nothing). After your co-host has taken their tax free income they might want to give you an early birthday present in cash?
Its January in London and cold and wet. The number of bookings I am getting has reduced and I have the occasional empty day. This is the same as last year i recall so I’m not worried. The low GBP will keep the tourists coming to London and I keep my prices low so I’ve always got a steady stream of customers. I have many ‘regular’ customers who found me on airbnb but have kept coming back and now pay me cash.
Should I accept guests who pay cash?
Nobody want to pay the airbnb service fee but that’s the price you pay for using their platform. Without the airbnb platform I would find it very difficult to find new customers so it’s only fair I pay them for this service. But what if I already found a customer should I accept them? Well yes if your happy with that person. Airbnb does keep a record of who stays at your place and should have copy of their ID etc so there is some safety. If you accept a cash payment then you open the possibility of getting into some unexpected trouble perhaps. Most of my regulars are UK citizens who are working in London a few days a week so I’m happy with them. Guests who pay cash might also be a way of getting round the 90 day rules in London.
How to automate your Airbnb Home
If you are a live-in airbnb host like me then from time to time you might feel unsure about leaving your guests in the house alone when you go out to the shops or where ever. It’s hard to relax when there are strangers in your home even if they seem very nice on first impressions. So there are a few small ways to keep an eye on your home and give you some piece of mind.
Install security cameras
Now don’t get me wrong here the idea is not to spy on your guests. I have a camera in my living room, which is off limits to guests. The purpose of this camera is partly to keep an eye on my little dog but also in case any guests decide to break the rules and enter my living area and kitchen. I use this camera from Canary https://canary.is I find it excellent quality and easy to setup. I am also considering putting one facing my front door so I can see who comes in and out of the house.
Door Sensors and Motion sensors
I once had a guest who sent me a complaint via my mobile phone that the house was too cold. I was not at home at the time so was unable to switch the heating on. Shortly after I installed Hive Active Heating in my home so I can control my heating using the mobile phone application. As part of the pack I was send a door and motion sensor. Both of these I have found very useful in keeping an eye on my home. The door sensor lets me know when someone opens and closes the door. The motion sensor detect movement. I put the motion sensor near the guests door so I know if they are at home or when they come and go. It’s non-intrusive and can make you feel more comfortable when away from your listing.
It’s December in London and Christmas is coming. After a very busy Autumn Airbnb has started to go quiet. I am booked most of the time but some days I have one or two empty listings a week. It has been the same the previous two years and usually pics up towards the end of January. The price I am charging for the each listing has risen slightly this year (after being flat for two years). I believe this is possible because of the lower GBP versus the Euro and the Dollar.
the cumulative number of nights of use as temporary sleeping accommodation does not exceed 90 nights in a calendar year
The vast majority of hosts in London will be letting out for more than 90 days a year so this could be a real problem for hosts. It is possible to apply for permission to be exempt from the rules by obtaining planning permission. Obtaining planning permission for temporary sleeping accommodation (effectively a hotel) is not going to be possible for most hosts as the criteria is exhaustive and would be opposed by neighbours.
Airbnb is limiting their platform for hosts from 1st January
In a letter recently sent to hosts Airbnb says it will limit the number of bookings to 90 days (presumably the website will automatically de-list the listing when the 90 day limit is reached).
As of 1 January 2017, Airbnb’s systems will automatically limit entire home listings in Greater London to 90 nights a year…….we are introducing a change to our platform that will create new and automated limits to help ensure that entire home listings in London are not shared for more than 90 days a year, unless hosts confirm that they have permission to share their space more frequently.
Do the new rules only affect entire home listings?
The letter from Airbnb to hosts clearly says that ‘entire home’ listings are not shared for more than 90 days a year. Presumably we can take from this that those hosts offering private rooms in their house will be exempt from the 90 listing rule. The deregulation act does mention ‘This applies even if only part of the premises is used as temporary sleeping accommodation’ so those hosts who have only private room listings may also fall foul of the new rules.
I think that Airbnb is trying it’s best to conform with local rules (the bad press the company has received all over the world is surely on the mind of the directors) but hopefully is doing it in such a way to give hosts a chance to be seen to adhere to local rules and still host without interruption. We will have to wait and see how the new rules will affect bookings on the website. A obvious solution to getting around the rules would be to have the same listing under numerous profiles (presumably 360 days per year/ 90 days = 4 profiles needed).
It’s worth noting that up until 2015 short term lets were effectively illegal in London and the vast majority of hosts had no problems. At the very least we are now getting some clarity on what the rules are and will be in the future so hosts can plan properly. To be honest the rules do make some sense and will deter those ‘professional’ hosts from investing large sums of money buying property purely to let on airbnb. Those hosts who simply let out a spare room and work in regular jobs hopefully will be unaffected.
After a very quiet August bookings have picked up in September. I also have removed the minimum two day booking rule on all my listings. I was starting to get empty rooms and I just couldn’t see that money go to waste. This means more single night bookings and therefore more sheets to clean and checking guests in and out but this is the price to pay for keeping a full calendar.
Last minute bookings
Last minute bookings can be very rewarding. If I have a gap between bookings I sometimes put the price really high (usually 50% price increase) in the hope of getting a last minute windfall. I have found on many occasions that if you take the risk for last minute bookings you can earn some very good extra money. Some people for whatever reason need a place to sleep. Often they are last minute holiday makers or people stuck in London unexpectedly, perhaps a delayed flight.
If you want to make money above and beyond what you would normally expect then putting your price high in the expectation of a last minute booking is a way to do it. To make this happen I recommend using Instant Book because those guests looking for a last minute booking will only want to book instantly and not wait for a reply. Also you will need to set your calendar so guests can book later into the night – say as late as 9pm.
Will the lower GBP mean more airbnb bookings?
The GBP dropped by 15-20% against most major currencies after the Brexit vote on 23rd June. This means it will be cheaper for foreigners to visit the UK. This could mean either more tourists will visit the UK (because its cheaper than other destinations) or that anyone visiting the UK will be willing to spend more money when they are here (because it’s cheaper). Perhaps both will happen and the UK will have a kind of tourist boom. Airbnb hosts should be benefitting from the lower GBP as more people may choose to visit the UK than previously would have done.
It’s August in London and it finally turned hot after many weeks of rain. I was really busy in June and most of July but it has gotten quieter in August and I have decided to drop my prices slightly to reflect that. Although I did put the price up on one room on a Friday night by 50% (because I didn’t want it filled that night as I had plans the next morning) but it sold suddenly at the last minute to a really nice man from Taiwan.
Brexit and Airbnb
In June the UK voted to leave the European Union. The immediate effect of Brexit was the £ Sterling dropped a significant amount against mainly the US dollar but also against many other currencies. This means visitors to the UK will find prices cheaper so I think this is good for Airbnb hosts. More people may choose to visit the UK (a place previously seen as expensive) when they realise it will be cheaper than other major destinations.
Although I do get many guests from the European continent I get much fewer French and German guests than I do from Eastern Europe. Why this might be I’m not sure. I may start seeing more guests from Asia and North America because of the more favourable exchange rate and because their economies are better than Europe.
Can a guest amend a booking if it has already started?
A guest recently stayed with me who had come to London from France for a new life in London and only wanted to stay with me for 3 nights to give her enough time to find a permanent place to stay. I prefer guests who come to London for sightseeing and not those who are coming here to find work etc. One of the reasons for this is because some guests start using my address when filling out forms etc when they first arrive. For example this guest even ordered GiffGaff sim cards to my house before she arrived. The problem with this is now I will be receiving junk mail to my house in her name for the next few years.
The guest asked to end her stay one night early and sent me a booking change request on airbnb. The reason she wanted to end her stay early was because she had found a new permanent place to live and she wanted to get some money back from her stay with me. I was surprised because I had no idea this was possible. I had even been paid out for her stay and had spent the money, so I had no idea how this would even work refund wise (I have since learned airbnb take the money from your neat booking payout).
I told her I would not agree to the amendment. It was not in my interest to lose a nights payment and because of the short notice I was unlikely to get another booking, which would anyway be more hassle for me to clean everything and check-in a new guest etc. I have a 5 day minimum notice cancelation setting for my listing anyway. I gather she was not impressed by my decision (I don’t think I was unfair under the circumstances and the amount of money was quite small at £20), and she even went to the extreme of cancelling the reservation presumably in an attempt to try and reclaim some money, which achieved nothing of the sort.
For the first time since becoming a Airbnb host more than a year ago i’ve had to use the Airbnb Resolution Centre. I was impressed with the results but perhaps my case was an easy one fortunately I haven’t had any serious problems being an Airbnb host.
I raised a Airbnb Resolution Centre case because a guest had booked the room for one person but sneaked his girlfriend in to sleep the night. He checked in by himself but at some point during the night while I was sleeping very quietly brought his girlfriend home. It was almost certainly pre planned and I would never have known about it but they made no effort to hide it the next day.
Spring is in the air in London and I’m fully booked. I occasionally raise my prices on days where I would prefer to not be full (to give myself a bit of a break) but even these slots were booked up. After 3 months of cold weather and horrible rain it looks like the weather in London is about to improve. Better weather usually mean more guests so it could be very busy over the next six months.
How much should I increase my prices during the summer?
Although I do increase my prices during the summer it’s not by much. Only a few extra pounds per night. Part of the reason is that I don’t want disappointed customers who rate my listing less than five starts for value. If I put my price high then there is a certain expectation to live up to that price. A lower price has much less expectation – “at least it was cheap.”
I did notice this on my listing for the first time. “This is a rare find – Richard’s place is usually booked.” Being a ‘rare find’ must be some sort of special Airbnb host badge. It does at least create this extra impetus to buy for potential guests – If Richard is usually booked then he must be good. I have no idea what it takes to become a rare find but I have had over 300 guests and I’m usually full so maybe thats it.
My strategy is simple – stay booked all the time. If I have to lower my price I will. The way I see it Airbnb wants good hosts who will take bookings at any time. If your a reliable host they will reward you with more business (hopefully). Being too choosey on what price your willing to take and which type of guests your happy to accept will reduce your future bookings.
The more guests you’ve had the more guests you will have. It’s all about being a safe bet. Most of your guests will be from out of town and will not know your area and will judge on your pictures firstly and secondly on your reviews. A good looking picture helps a lot but it’s the reviews that make the sale. A long list of great reviews will put someone at ease and be confident they are getting what they see in the picture. To get those reviews you need lots and lots of bookings which means taking almost anyone who wants to stay and at the times when it doesn’t always suit you. Thats business.
Finally we are coming out of winter in London. Its getting brighter in the mornings and evening and Christmas is just an old memory now. The heating is still on non-stop in my Airbnb house as the couple from Singapore find it very cold even on a nice day. My gas and electricity bills are double last years despite the recent global fall in energy prices. Being an Airbnb host means higher costs and greater wear and tear on everything. Demand did fall over winter especially when the temperature started to get very low but now i’m getting fully booked every day again.
Do I need extra security in my Airbnb listing?
I let my guests come and go as they please in my house. I have three rooms listed on Airbnb and they are usually full. This means I have guests coming and going late into the night. Most forget to lock the front door despite the little notice I put up above the door handle. To make things worse none of the guests know each other so if a stranger were to enter the house and I was not there the other guests might not even know that person is not supposed to be there.
I am considering beefing up security by placing cameras around the house especially in the entrance way. I’m told that eye level cameras are the best as the police have facial recognition technology. I would much rather deter an intruder rather than catch him afterwards. There is some excellent advise here from the Metropolitan police. I can strongly recommend having locks on all the bedroom doors. I understand that this might cause a problem if the event of fire but it goes a long way towards making the guests feel safe.
Most of my guests come from overseas and about 99% have been very nice people. I would warn against allowing guests to bring any friends over as in my experience it’s those people who always seem to be the ones who cause the most trouble. I don’t allow any friends to come into the house. If they ask just say “no sorry it’s a house rule” if they ask why just say “it’s for the safety of everyone.” Airbnb will back you up on this as only paying guests can are allowed in the listing.
The £GBP is falling. Will my Airbnb listing reap the benefit?
If your an Airbnb host in the UK you may be surprised to know your a British export. Tourism is an export and is one of the UK’s biggest. So the next time you ready something in the news about British exports increasing you can pat yourself on the back. Exports generally suffer when a the nations currency is high (as it’s costs more for foreigners to pay for goods/services) and of course improves when a currency falls (goods and services become cheaper). The British pound recently took a fall against major currencies like the Euro and US Dollar partly because of the upcoming European referendum. Most of my customers are from the Eurozone so demand may increase to a point I can charge much higher prices.
A friend of mine has just become an Airbnb host for the first time. His first guest had just finished her stay with him and had left a nice review. The listing is a private room in his London flat near Shoreditch High Street and he charges £35 a night. Being an experienced Airbnb host myself my first question was “did you use the airbnb photographer for your listing?” He said “No need, I did the photo’s myself.” This is a big mistake.
You need to make your Airbnb listing as professional as possible
I did a search for my friends Airbnb listing and it was full of classic mistakes. He was not using the free airbnb photographer and consequently his photos were a disaster. The bedroom looked like a hostel room. The bed was badly made and looked like someone had just slept in it (the dull grey sheets didn’t help), no other furniture was visible expect for a mirror (not hung on the wall just left on the floor). No flowers or any pleasant decor. The bathroom continued the hostel vibe being clean but otherwise uninviting and the toilet being centre of the picture – with the seat up!
Using the Airbnb phtographer is important for two reasons: 1 – the pictures will look better and 2 – the photos will be verified which means your listing will get a boost in the airbnb search rankings. I read through the description of my friends first Airbnb listing carefully and it had several grammatical errors and used some texting type like PPL instead of people, which to me looked unprofessional. The profile picture for himself also looked dark and with a serious face instead of a big smile.
How to decide if you should be an Airbnb Host?
Being an airbnb host is not for everyone. Its much more demanding that being a traditional landlord and guests can be difficult and unpredictable. Although the amount you can charge is greater than with traditional lodgers and renters there are additional cleaning costs and more importantly the personal time it can take off your hands is high. A handy guide to help you decide if being a host is right for you has been written by learnairbnb.com website and can be found here:
Its December in London and the weather has been unusually mild for this time of year. Bookings have dropped off since the autumn and I’ve reduced my prices again for the new year. I’m now charging £28 a night for a double room for two people – this time a year ago I was hoping to be able to charge £35 a night by now, so its very disappointing. I have 200+ reviews and most of them have been positive but my five star review rate is still languishing at 64% and has been for about a year. I have noticed that there are more listings in my area and they are mostly double rooms at prices barely above the price of a single.
Airbnb Hosting Mistakes
Airbnb has been around a little while now in the UK but I’m seeing some very obvious mistakes with some listings such as:
Messy rooms in the pictures especially the cover image
Not using a real picture of yourself in your airbnb profile (hiding your identity on a website built on trust is not clever)
I have noticed the airbnb price tips to be different for my two single rooms (which are in the same house and are very similar) having wildly different suggested prices. One room currently has a suggested price of £21 the other £25. The one with the £25 price tip has in general received better five star reviews than the other (why I can’t really say as they are very similar) so this may be the reason.
Airbnb price tips are handy if your not sure what price you should be charging but I don’t find them very useful. The obvious problem is that if everyone is using the airbnb price tip then you will all be charging the same and therefore have as much chance of being booked as everyone else. I like to be full at all times even if this means selling at a discount (I would rather lose £2 than £20). I see an empty room as money lost so any sale is a good sale.
I would say on average most of my guests are very nice. They tend to be young, employed, and most come from Western Europe but occasionally from Brazil, USA, and East Asia. Surprisingly many are female which might say something for the level of safety I provide in my accommodation (lockable rooms and live-in hosts).
Guests on Christmas Day
Over the Christmas period I do have airbnb guests staying at my house. I still have my usual family Christmas and the guests were out of the house most of the time. I did have to explain to some of them that Christmas day meant that there would be no public transport in London which they found surprising for some reason. I did get some guest enquires about arriving on Christmas day which I had no problem with but I quickly explained to them that getting from Heathrow airport to my house on Christmas day would mean a taxi and and a very expensive one at that. It makes no sense saving money on a airline ticket because it arrives on Christmas day only to loose all your savings on the taxi trip from the airport in my opinion.
Its coming close to winter here in London and although the first snow has not yet fallen bookings have become thinner on the ground. I am lucky that London always has someone arriving from somewhere, so bookings do come in no matter what the weather is but sometimes it’s nice to have firm bookings in advance – or so I used to think?
The problem with being an airbnb host is that it becomes your life in many ways. For some this is a good thing and can add meaning and a source of enjoyment. For me this means I am effectively on call 24 hours a day. I can’t afford to pay anyone else to look after my business and nobody will ever care about it as much as I do. Thankfully there have been few occasions where I have had to run away from my real 9-5 job to sort out a problem at my listing. However I am conscious of the fact that one day something may go very wrong.
Airbnb Calendar Settings
To reduce the chance of future issues I have decided to limit my calendar to only a month in advance. To my knowledge there is no way of doing this other than blocking off the dates. There is a function to limit bookings for only 3 months in advance but this is too long for me. Why do this? Because my life doesn’t work on more than a 1 month ahead schedule. If I take a booking 3 months in advance and my life changes to the point where I can’t handle the booking then I have to cancel and that means I get a penalty from airbnb and then no more bookings.
I get a lot of last minute guests so I can still turn a profit only allowing bookings in the same month. In fact I have found that last minute bookings can achieve the highest prices (due to other good listings being already full) and the guests tend to be those who are in the city for a short time and just need somewhere to crash before they leave – this means they tend to arrive in the evening after I get home from work and therefore there is no mad rush to get the room ready.
Airbnb Instant Book
I will have to stop using Instant book also as I need to control what time people will be coming and going to my place. Instant book has been very successful for me. I think all my Instant book guests were very nice people and knew what they wanted. As mush as I like this tool its got to go as one wrong booking could cause a nightmare for me. I already had a problem a few weeks ago with a guest who was coming and I couldn’t be there to meet her. I asked a friend to stay at my house and wait for the guest who was supposed to be there about 11am. My friend ended up waiting four hours for the guest (which is not unusual as many people misjudge the amount of time it will take them to clear customs at Heathrow airport and then actually make it all the way to my place) but it was very embarrassing for me and it really put my friend out.
The main point is Airbnb hosts could be exempt from the new rules and still be able to claim the full tax deduction. This will come as some relief for many an airbnb host including me. The general reason for this is that the government is considering “furnished holidays lettings” as a business and not just and investment. To qualify as a furnished holiday let the government has provided some criteria:
The accommodation must the in UK or EEA (part of the Eurozone) and be commercially let
It has to be furnished
It must be available for let at least 210 days of the year
It must have been let for at least 105 days
It cannot be let for a single trip of more than 155 days
For most hosts the above criteria will be no issue at all. The new rules do make some sense. Those hosts who are letting for less than 105 days of the year will most likely be claiming the rent-a-room scheme allowance and not be claiming any deductions anyway.
These changes only take partial effect in 2017 and not fully implemented until 2020 so a little planning should see you right.
I recently changed my Airbnb cancellation policy from Flexible: Full refund 1 day prior to arrival, except fees to Moderate: Full refund 5 days prior to arrival, except fees. The reasons for doing this are that I did have a few cancellations over the summer and although I had managed to refill most of the empty spaces in my calendar I started to think there is a real risk of a last minute cancellation causing significant financial loss to me so I decided to change to Moderate. This at least would give me 5 days to refill the space. What I didn’t think of was the possibility of selling the room twice.
Get paid twice for your Airbnb listing
If your cancellation policy is either Moderate or Strict: 50% refund up until 1 week prior to arrival, except fees then there exists the possibility of getting paid twice for the listing. For example if a guest books for a week but two days prior to check-in decides they can’t or don’t want to use their booking then they will not be entitled to a refund. You are then free to re-sell the listing to someone else and thereby get paid twice. This can only happen if the guest officially cancels the booking. To do this they need to officially cancel on the website and not just send you a note. A host can’t cancel a trip for a guest as this will give them a black mark (Airbnb will assume the host cancelled for their own reasons).
Selling a room twice can really boost your income for the month so it’s worth considering changing your cancellation policy.
How to automate your Airbnb listing
If you’re a live-in Airbnb host then sooner or later the issue of what to do if you want to take a holiday yourself arises. Even when I’m not on holiday I don’t like to leave the house for too long a period of time, in case there are issues when I’m not there. I certainly don’t like the idea of leaving the house for a week with guests in situ. Security is one thing that worries me most. Only I know who is a paid guest and who is not. No one else in the house knows each other and a stranger could easily enter the house unchallenged.
If I want to go on holiday the safest thing for me to do is to block off the calendar and have no guests over this period. Of course this means no income for a week which adds up to a lot of money. I could find a friend or family member who would be willing to look after the house but this is unfair on other people as they have their own lives and it’s actually more hassle for them than they realize (being a host is not as much fun as people think).
There are agencies you can you who offer a professional greeting service such as Hostmaker and airsorted. These agencies help you automate your Airbnb business so you can be lounging on the beach drinking cocktails and just let the money roll in. In reality the amount on money these services charge is likely to wipe out any profit you could potentially make from your business as the margins for this business are wafer thin.
August has possibly been my worst month for new bookings. My calendar for the month of August was actually quite full but September onwards is looking pretty empty. I find that guests tend to book about 4-6 weeks in advance so to have so many blank spaces at this stage is not good. Some guests do book much further in advance of course but the main bulk tend to come in only about a month ahead. I do get a lot of last minute bookings due to my location in central London but I would prefer to have bookings all my bookings in advance given the choice even if it meant losing a few quid.
Why have my bookings dropped off?
Well A quick search of my local area in Newham, East London, has revealed that there are many new listings in my area. Most of which are priced lower than me. I recall only about a year ago there were less than 5 similar listings in my area which consisted mostly of old ladies and couples with a spare room. Now there are multiple listings of small rooms in former HMO’s all over the area. Clearly those former slumlord landlords who formerly let single rooms to asylum seekers and desperate immigrants have now switched to becoming Airbnb hosts.
Why is there more competition in my area?
One of the reasons why I think these slumlords have switched from the desperate poor to Airbnb holidaymakers is the recent tightening up of Newham council’s HMO license and additional licensing scheme. HMO licenses’ are mandatory across the UK for properties which fit House of Multiple Occupation criteria. But the additional licensing is a newer scheme and has made it less desirable and more expensive for landlords in the area.
So what can I do about my empty calendar for September?
Well this first thing I did was drop my prices. I now have the lowest prices since I started hosting. I was expecting that as my hosting experience grew and my good reviews piled up I could start charging more and more for each listing. Sadly not! I also removed my deposit requirements for each listing. A risky move to be sure but it seemed worth a try even if it just got the ball rolling. For a few more days it was deathly quiet but then the bookings started to flood back in. It’s hard to be sure if this was just a quiet patch that we just came out of or if my pricing strategy did the trick but I’m sure happy to be getting bookings again.
Should I change my cancellation policy?
I’ve had a fair few cancellations recently. Almost always I have been able to get another booking at the last minute but I am starting to think it’s not a good idea to be so flexible with the cancellation policy. I currently have my cancellation policy set to Flexible which means a full refund if cancelled 24 hours prior to check-in. I am going to change this to Moderate – Full refund 5 days prior to arrival, except fees. I think this shouldn’t turn off too many people who are serious about their bookings.
Can you get rich using Airbnb? Some DO I’m sure. But how do they do that exactly?
Most of the stories I’ve read about those who’s say they’ve made sooo much money using Airbnb go something like this – “I was taking a six week vacation (they are usually from the USA) and decided to give using Airbnb a try to rent out my apartment while I was away. I was making so much money I decided to quit my job and stay on vacation forever.” Or some bullshit like this. The obvious point they never seem to touch on is the fact they already own a apartment in a very central location in a major city, presumably mortgage free, and had they rented this out in the normal fashion to a local worker would have made almost as much money anyway.
So do I know a way to get rich using Airbnb? Well not exactly but I did come across a listing once in central London looked like the best way of getting some serious earnings. It was a one bed flat with a double bed in the bedroom and instead of a sofa and dining table etc in the living room it has two (2) double beds. So that makes 3 double beds in a one bed flat. It was advertised as ‘sleeps 6 persons’, which is does of course with three double beds. It had the one shower room and a small kitchen. The price was £150 a night – THATS £1050 A WEEK!
So to get rich on airbnb do as follows:
Get a one bed apartment in central London
Put one double bed in the bedroom and two double beds in the living room. No other furniture is needed