Do you want to get into Airbnb investing, but heard that Airbnb is broken? Are the whispers of missing the Airbnb investing wave making you second guess getting started? Do you wish you knew what you needed to do to make money as a new Airbnb investor?

If so, tune into Episode 27 of the Host Coach Airbnb Podcast! We’re unpacking the fact that the Airbnb investing opportunity is NOT dead and the pitfall impacting 95% of hosts’ profits.

Read on to learn to learn how to strategically choose an investment location, the importance of keeping high occupancy, and the professional host mindset necessary to view and run your Airbnb as a profitable business.

Topics discussed in this episode:

• How to successfully invest in the new era of Airbnb
• The pitfall impacting 95% of Airbnb hosts’ profits
• The best software to select a market to invest in
• Listing set up no-nos that can kill your business
• The amenities to invest or reinvest in to attract guests
• The professional host mindsett

Host Coach Airbnb Podcast Episode 27 Show Notes:

Why are we hearing Airbnb is dead or busted? Who's saying this? Who's asking, is it too late to jump in? This is two sides of the same coin. We're hearing this not from guests.

Airbnb is NOT Dead

I don't hear any guests saying Airbnb is dead. Airbnb's profits are up year over year. People are staying more and more. We're hearing this from hosts. Hosts are concerned that they're not doing as well as they once were. And this is because in the COVID era, so many people got involved in the Airbnb market.

It was very easy. You could take some photos, do a okay job in a listing, be lackluster in your hospitality. And the money poured in, it came in in buckets. It was easy post COVID the demand has slowed. The demand is still strong. It's just not as obscene as it was when we had all that pent up money and energy right after COVID to get out of the house and go do something it's returned to a normal historic demand.

The New Era of Airbnb Investing

Nothing's busted. Nothing's broken. It's not too late. It's just a new era. Times have changed. The demand is a little lower. We just have to up our game as professionals or get into the game as a professional. This is an opportunity. Anytime an error change, anytime there's a shift in markets, there's an opportunity.

There's an opportunity to be more successful as an Airbnb host, because Petitors are getting out or aren't keeping up, or it's an opportunity to get started as an Airbnb investor going in with a plan. Proper professionalism mindset.

There's no more set it and forget it investing. And so in this new era, you need to choose your investment location wisely.

We have a whole episode on finding your where, but pay attention. You can't just buy a place cause it's a good price somewhere and expect to make tons of money. You need to look at the market demand. Use a tool like AirDNA. See what the score is for whether this is a great area to invest in or not. If it's not, keep looking, don't force it.

If there's only, two or three or four Airbnbs, it might not be a great market on the other side. If there's 2000 listings in a small city, it's saturated and that may not be the easiest place to break into and make money. So again, choose your investment wisely.

HDR Photos

Next up, HDR photos. The time period where you could just snap some photos. We all have great phone photos. I get it. They're getting better and better, but they are not high definition professional real estate photos. You need those to stand out from your competition. You need to jump off the page when guests are looking in your area.

And in that same vein, you can't have HDR photos of a boring, HDR Drab condo and expect to make money and be fully occupied. It could be as small as just adding brightly colored duvets and some nice art, but you have to up your game in design so that photos can capture it and convey that, Oh, this place is special. I want to stay here. It's not hard. It just takes a little bit of attention to detail, right?

And once you have those photos, there's some really key. Listing set up pitfalls that a lot of hosts that got started on the quick and dirty fell in, and we're going to help you avoid those listing pitfalls or go back.

Airbnb Listing Pitfalls to Avoid

If you have an Airbnb listing, take a look at these couple of things. First and foremost is minimum stay requirements. I'm a big advocate of a two day minimum stay. Requirement. A lot of people will say, well, I have three or four that may work in season at the beach. But the bottom line is you can't make me the guest decide to stay for three days just because you have a three day minimum.

If I'm going to visit some friends for the weekend and I just have off Friday and Saturday night and you have a three or four day minimum, I'm not going to be shown your listing. The guest who's looking for a two night stay they're just plain not going to see your listing. So you're not going to get the views.

Next is your cancellation policy. Airbnb gives us five or six cancellation policies. They're all on a range from the most flexible to the most stringent. I pick the middle ground. If you have a strict cancellation policy, people sort by this you're going to get less views and you're going to have guests less inclined to stay. And these aren't guests that are hoping that they can cancel last minute. These are families. These are working professionals. Life happens. I look at it like there's going to be an unforeseen lacrosse tournament and we'll know a week before, but we're not going to know 20 days before. Exactly. So having that flexibility allows me to book Airbnbs for our family.

The Best Cancellation Policy for Airbnb Hosts

And I think some of this comes out of fear as well. And I can tell you we've hosted 3, 500 odd guests. Every time we have a cancellation, we rebook almost immediately. And I feel the algorithm almost knows it favors it. But if you're doing a good job, keeping a full calendar and someone cancels six days out or four days out, you're going to rebook.

So go ahead and feel comfortable with that moderate cancellation policy. Next is instant booking. Instant booking is paramount to Airbnb's internal culture and success. Why Airbnb is in competition. With the hotel industry. And if I'm looking to book a hotel at a Marriott, in Orlando, I can book that 11 o'clock at night from my computer, Airbnb must be able to compete with the hotel industry.

And that's where they got started with allowing instant booking. If for some reason you're not comfortable with instant booking, talk to us, give us a call. We want to hear, we want to hear about it. Instant booking is paramount to being shown and being seen. It's so important to Airbnb that it's a must have, maybe don't consider hosting , if instant booking doesn't work for you.

Turn OFF Guest Good Track Record Requirement (Really)

A subset under instant booking, that's kind of controversial in that it's changed. It's called a good track record and it's a little lever under instant booking. Go take a look at this. I've seen it defaulting on, I've seen it defaulting off, , it's something to go and check if you had a listing for a while, the language is kind of confusing, , good track record.

Yeah, of course. Why wouldn't I want somebody with a good track record? Well, the definition under that means that that guest must have one. Previous Airbnb stay and have one review. So you would think, okay, well, they stayed once and they got a review. Not all hosts give reviews, not all of us are that diligent about it.

So someone could have used Airbnb three times and not have a review. Or, I would say close to half of our guests are first time Airbnb users. So if you have that require a good track record turned on, you're lisiting is going to be invisible. You're not even going to be shown to any of those guests.

So that's a huge pitfall to avoid.

The Pros of Being a Pet Friendly Airbnb

Finally be pet friendly, if at all possible. What was the stat you said the other day, Danielle?

Over 60% of US households have a pet and are actively looking to travel with that pet. Yet, less than 30% of U. S. Airbnbs are pet friendly. So there's a mismatch.

There's high demand for pet friendly and not a match on Airbnb yet. So , being pet friendly, if you can, if you have the correct flooring and the correct housekeeping measures in place, is a great way to stay at the top of search.

Occupancy Levels are Key to Success

The next is occupancy levels. And again, this becomes an emotional thing and it doesn't have to be, this is really just dollars and cents.

We must maintain a full calendar. We operate our portfolio at about 94 or 95%. Occupancy over the year over, 10 properties and , people tend to, ooh, and ah, when we say that, well, how do you do that? It's very easy, right? We can book any property, to a hundred percent occupancy, and it's just a matter of setting the right price to meet the demand, on any given day.

You take that property to $5 a night, it's going to book every night, right? So the idea is more about revenue management, we want to get the highest price possible, and the other part is just that emotional barrier of, "my place is worth $200 a night, or I don't want to take less than $150 a night."

I'm not making money at a hundred dollars a night. The fact is, guys, I've got a degree in economics, by the way. , your marginal. Cost for a night is nearly zero. We're going to pass our cleaning fee straight through. If we're charged $60 for cleaning, we're going to charge a $60 cleaning fee.

So our marginal costs, we're still paying our mortgage. We have to pay our internet. We have to pay our electric. Yes. Somebody is going to open the front door two or three times in the refrigerator, two or three times. It might cost us 50 cents in electric to have that place occupied versus not occupied.

Impliment Dynamic Pricing for your STR

So we got to get over the mental, emotional barrier of what our lowest minimum price is. So the other opportunity here, and this is huge! I've seen so many people get into Airbnb worried, "Is it too late for me?" 95 percent of hosts listings are not using dynamic pricing.

So they're missing the revenue mark and they're operating at 50 percent occupancy. If you come in with a professional mindset, set up dynamic pricing, get over the emotional barrier to what your place is worth on a nightly rate - you are going to have a leg up on 90 percent of all hosts out there!

It's so true. And circling back, one of the other holdbacks, on the lower price for an evening at your place is, "I don't want bad people to stay in my home." We have had the opposite happen where we've discounted nights to make sure that they booked and the people were so grateful.

They're like, "this place is amazing. I can't believe we got it for this price." And they leave a glowing review, which is never a bad thing. So if that's the fear that's holding you back, let it go. It's like Elsa sings, "Let it goooo! "

Professional Airbnb Hospitality

The next thing to think about as you're becoming a professional Airbnb host is your level of hospitality.

We need to have a professional level of hospitality. Your place has to be super, super comfortable. clean. You need to have automated messaging, concierge list of to dos in your area, restaurants, activities, parks, and you need to personally have an eagerness to make your guests happy. You want them to love your place, not just so you get a five star review and make money, but because you love it.

You love your place and get joy from other people's joy. We were just actually out for Culin's birthday lunch yesterday and an employee ran out and went to Starbucks to get a specialty coffee for a different table. And that commitment to excellence and guest satisfaction. I was like, wow, that's the level you want to be at.

No, you don't have to go get people coffee. You just have a nice coffee maker in your place, but pay attention to what guests need and want to feel. valued and cared about. Along those lines, as a professional, mark your calendar and go and do quarterly owner's eye inspections at your listing or listings.

This is how you keep up with property needs. This is where you see the wear and tear that a guest or a housekeeper may not say like, Oh, you know what? The linens are a little bit threadbare or the deck needs to be stained again. There's all of these little things that add up over time, and you can't expect your housekeeper in a quick turnover to see all of that.

So it's incredibly important to have the professionalism and treat your Airbnb as a business and spend the time quarterly to go check it out so you know what to fix.

Review Your Reviews

There's also gold to be found in the reviews, the feedback that you're getting from your guests. I don't think many hosts do this. Your guests are going to tell you in private feedback and in public feedback what was lackluster or what was missing review those reviews. Go through them to find the small things that need to be fixed or that impact your listing or suggestions for wouldn't it be great if it had this.

You've got a valuable information stream there from your guests. Was there a bee's nest, or a sink draining slowly, or broken bed slats? That one happens to us a lot. But people tell us about that. It's not something that the housekeeper is necessarily going to notice, but your guests will notice and they'll let you know. And by taking care of that, then it doesn't become a big enough problem that it makes it into a formal public review and lowers your number of stars.

Reinvest Profit into Amenities

And as you're rolling along, use some of your profits to reinvest in amenities. We've had satellite internet, because we're in a rural spots, for a long time. Now Starlink has come out. So we've gone back and upgraded to Starlink and it's hundreds of times faster than what we had before. And guests are happy about it. People are working these days from our places, and from your place, presumably.

Also consider investing in the biggies: hot tubs and saunas and gazebos and grills. Add those things in to make your listing stand out. Your Airbnb is not just a place to stay. It's an experience. So if you can provide experiences that your next door neighbor isn't providing...

I just chuckled to myself there because I was telling a friend that they should add a outdoor sauna to their place and he hummed and hawed about it. He said, "You know, the Airbnb right next to mine's got one of those." And I was like, "that's the point, right?"

We want to have amenities that create experiences that perhaps our competition doesn't have. Again it is an opportunity. And we talked about if you have to launch and you're not pet friendly, but you want to be, and you see the value in it, just use those profits over time to go back, replace that flooring and make the place pet friendly.

Treat your Airbnb Like the Business It Is

So in a nutshell, you need to view your Airbnb as a business and treat it like one. Become a professional host and investor, educate yourself, read books, listen to podcasts like this one, build a team that values each guest and strives to make their experience the best ever. Take The more you care about your Airbnb and your guests, the more it shows and the more it positively impacts their stay and your cashflow, people are willing to pay top dollar for incredible stays with incredible hospitality.

An example of this is the most recent cabin we bought, rennovated, and listed: Stargazer. We have 54 five star reviews, and that has led to someone booking a weekend June for over $3,000!!

The reason someone is willing to pony up three grand to stay in a three bedroom cabin as two people is because it's obvious from our reviews that we care about our guests and our cabin.

We've provided an insane level of service in a very remote location, and that makes our listing highly desirable. And actually, Airbnb gave it the guest favorite banner, which once again feeds into guest demand and their pricing insensitivity. The better it is, the more people are willing to pay as long as you deliver on that promise.

So there you have it. You now know the opportunity to make money on Airbnb is still there. You just need to have a professional host mindset. View your Airbnb as a business and actively work on your listing and your hospitality skills. You also learned our pricing strategy to force maximum occupancy to generate maximum cashflow as an investor, along with actionable tips for keeping your Airbnb in top shape for top guest satisfaction.

If you need to figure out your path to financial freedom, Airbnb investing is an amazing way to achieve it. Should you need personal online Airbnb coaching - that is what we do! Sign up for a free 30 minute Airbnb coaching call to explore your needs and how we can help you succeed as an Airbnb investor.