How To Airbnb Your House
Lauren Nowacki10-Minute Read
January 29, 2020
In today’s digital age, there are so many new ways to make money that didn’t exist 20, even 10, years ago. People are using their talents, computers, cars and even homes to make passive income in 2020. One way people are using their homes to make money – and even cover their monthly mortgage – is by renting out rooms or their entire house on Airbnb.
Laura G. has been an Airbnb host for almost 3 years. “It’s been some of the easiest money I’ve ever made,” she says. Laura, who makes about $1,500 per month through the site, has seen a ton of success renting out a private suite in the basement of her Washington, D.C. rowhome. “It basically pays my mortgage.”
Thanks to Airbnb, Laura has been able to support herself while starting her own educational consulting company. “I could not pay my bills without Airbnb,” she says. Along with the income it provides, her hosting gig has also allowed her to meet travelers from around 20 different countries. “It has been a really positive experience for me,” she says.
Interested in using your home to make some extra money or meet people from all walks of life? Read on to learn more about the popular site, how it works and how to Airbnb your house.
What Is Airbnb?
Founded in 2008, Airbnb is an online resource for renting lodging and booking travel experiences in cities across the globe. What’s unique about Airbnb is that you rent a room in someone’s house – or rent their entire home – at competitive prices that are usually cheaper than a hotel stay. The unique experience allows you to feel more like local than a tourist and often provides such amenities as a kitchen, laundry appliances and free parking that can help you save even more.
The concept is so popular, it has become a part of our vocabulary, often referring to a rental as “an Airbnb.” For example, a friend talking about an upcoming trip may say she’s “staying in an Airbnb.”
There are two things needed for Airbnb to be successful: Airbnb guests, who book lodging through the site, and Airbnb hosts, who rent out rooms in their home or their entire houses.
How Does Airbnb Work?
Airbnb works like a broker. It doesn’t own the homes you rent. Instead, it helps a guest find homes that match their criteria, then handles the transaction between guest and host. It does this by verifying hosts and renters, providing a messaging platform for both parties and collecting and transferring payments in a secure environment. Here’s how it works:
Booking An Airbnb
If you’re a traveler, visit Airbnb.com and enter your destination in the search bar. Once the results populate, you can narrow them down through various filters. Just like a home listing, you can read about the property and look at pictures. You can also read house rules (if available), learn more about the host and read reviews of the home and host from past Airbnb guests. Once you find a place you want to rent, you must create an account and profile before you reserve it. You’ll either instant book, which reserves your stay right away, or you’ll request to book, which requires the host to approve your reservation. The type of reservation will depend on the host.
Making Your Home An Airbnb
To make your home an Airbnb, you simply create an account for free and list your room or home. You can choose the dates you wish to host, set your own price and decide on house rules, like if you’ll allow pets or restrict access to certain rooms in the home.
“You can design it however you want,” says Laura, who restricts access to the kitchen (she includes a small fridge, microwave and coffee maker in the private suite) and declines reservations from single men as a safety precaution. According to Laura, you can only set that type of rule when you’re sharing a living space with your guests.
You’ll also craft a listing for your home, which should include photos of your home and the rooms guests can use, a description of the home and the area and a list of amenities the rental will include.
Once your post is live, guests can start reserving your space. As a host, you can decide whether to rent your space to each guest or decline their reservation request. Once your guests arrive at your home, Airbnb sends your earnings.
“It was so easy to start,” says Laura. “I just opened up my futon, put down some sheets, bought some extra snacks and posted my place on Airbnb. I started getting reservations relatively quickly. I didn’t have any problems.”
What Percentage Does Airbnb Take?
Since Airbnb assists with the transaction, the company earns a small commission from hosts and guests. The host service fee is usually around 3% for U.S. listings and can be more in other countries. For guests, the service fee is usually under 13% and varies based on several booking factors.
Should I Become A Host?
Hosting isn’t for everyone, so make sure it’s right for you and that you’re able to make the commitment before signing up.
“If you’re really disorganized and you’re not quick to respond to text messages, it may not be for you,” warns Laura, “because you have to respond [to guests] immediately.”
You must also provide a safe, inclusive and clean space for your guests. If you don’t live in clean or safe conditions, have discriminatory beliefs or wish to avoid people in general, a hosting gig may not be for you.
“You have to like interacting with people and you have to have a lot of patience,” says Laura. “Sometimes there’s a language barrier. Sometimes people ask a ton of questions. Sometimes people don’t read your requirements and then reserve your home. When that happens, you have to go through a whole process to terminate their booking.”
While the income you make from Airbnb is considered passive, there is some work involved. If you’re not willing to do the work, it may not be the best way to earn extra money.
Legalities Of Hosting An Airbnb
Along with deciding if hosting is right for you, you’ll also need to figure out if it’s legal. Some city laws and local zoning ordinances restrict people from hosting on Airbnb or require you to register your home or get a permit or license before doing so. You’ll also want to check with your homeowners or renter’s insurance policy. Keep in mind, some insurance companies frown upon rental activity. Other insurance companies have started offering certain options for home-sharing. It may be necessary to check with your homeowners association to make sure there are no rules or regulations on short-term rentals.
Is Being An Airbnb Host Worth it?
When asked if being an Airbnb host was worth it, Laura was quick to answer “definitely!” And it wasn’t just about the money, either.
“It’s been worth it in terms of my hope for humanity,” she said, adding, “I’ve met so many amazingly kind people.”
A social worker by nature and profession, Laura also enjoys the chance to build community and meet new people from all over the globe. She says, “Most of my career has been doing immigrant and refugee work, so I love hosting people from around the world. I feel like I am helping build bridges between cultures and helping build a sense of community.”
There are other benefits of making your home an Airbnb, too.
Pros Of Hosting On Airbnb
If you take pride in your home, this will give you the chance to show it off to people around the world. And if your space is too big for just you and your family, you can put unused space to good use – and make money off of it. If you’ve always wanted to run a bed and breakfast but never had enough money to buy one, this is your opportunity. You’ll also have the opportunity to meet new people, hear new stories and be a part of someone’s adventure and lasting memories.
Of course, there are also drawbacks that come with hosting that you should consider as well.
Cons Of Hosting On Airbnb
Along with the aforementioned issues that you may experience if hosting is not the right fit for you, there is also the risk you take when renting your home to complete strangers – the potential for damage, theft and injury. This is one of the most popular reasons people don’t rent their homes on the site. And while this is the biggest risk you’ll take, you may take some comfort knowing that Airbnb provides insurance for these matters.
Airbnb also offers a Host Guarantee, which will cover up to $1,000,000 in damages to the host’s property. It also provides Host Protection Insurance, which covers up to $1,000,000 of primary liability. These are automatically applied to every reservation for free, with no required premium or deductible. However, these programs don’t cover everything. For example, cash, jewelry, pets, collectibles and rare artwork are not covered.
What Is Some Advice For Beginner Hosts?
Are you new to hosting on Airbnb? While Laura says that you’ll learn as you go, she did offer a few things she’s learned along the way, so you won’t have to figure out everything the hard way. Here are a few pieces of advice she has for first-time hosts.
Use Locks To Keep Items Safe
Remember, not everything is covered by Airbnb’s insurance programs. To ensure your valuables are safe when you’re not around, put them in a safe or other storage containers that lock. And to ensure guests don’t go into rooms you want to keep private, install locks on the doors.
“I’ve never had anything stolen,” says Laura, “but I do have locks installed on my bedroom and office doors. I use them when I am hosting and not in the home.”
Limit Your Lengths Of Stay
At first, Laura set the length of stay for one month. However, that length of time brought other types of guests, not just travelers.
“D.C. is very transient and there’s a lot of poverty. When you set a long length of stay, you also get people who are evicted or looking for places to live,” says Laura. “I preferred travelers, so I learned it was necessary to limit the length of stay. My max is 2 weeks, and I rarely have people stay that long. When people stayed longer [before I set a max], they started to feel like a roommate instead of a guest.”
Along with setting a maximum length of stay, Laura advises setting a minimum, too, for various reasons. One-night reservations can overlap requests for longer stays, which can be more lucrative and you miss out on those. And according to Laura, one-night stays are “too much laundry.”
Utilize Airbnb Support
“Don’t be afraid to use Airbnb support people,” says Laura, who says the site has case managers who help resolve disputes, offer assistance with guests who don’t abide by check-in times and any other issues you may have. According to Airbnb, this support is offered globally, 24/7.
Guard Against Bed Bugs
Bed bugs are gross. They bite and can cause skin rashes, and they can spread. Along with being a nuisance, they can also cost you money. If your home gets bed bugs, Airbnb will take your listing down until your home has a clean bill of health. The company will pay to have an inspection completed on your home to ensure you are bed bug-free. However, it will not pay for treatment.
To help reduce your risk of bed bugs, Laura suggests buying mattress covers that protect against bed bugs. She also recommends buying luggage racks for guests. That way, they won’t throw their bags on the beds or furniture, causing bed bugs to spread if guests have them.
What Are Some Tips For Being A Great Airbnb Host?
We looked back on our own experiences and combed through listing reviews to see what people loved about their stays to curate a list of quick tips for being a great host.
- Create a home binder with a nice welcome message, emergency phone numbers, a printed copy of the house rules, directions for tricky appliances, local coupons and a list of your favorite restaurants, shops and attractions along with directions to each place.
- Create a guest book for guests to sign, write messages and read notes from past guests.
- If you’re there when they check-in, give them a tour of the home and refresher of the rules.
- Keep a stash of books, board games, and other at-home entertainment in case the weather is bad or guests just want to stay in and relax.
- Provide snacks and beverages, like bottled water.
- Provide travel-size toiletries in case guests forget to pack something.
- Offer outdoor apparel that may be difficult to pack, including umbrellas, rain boots, snowshoes, gloves, ice scrapers, etc.
- Keep a first-aid kit handy, along with extra phone chargers and a flashlight in case of a power outage.
Follow these tips and you’ll not only be a great host, but you could also become a superhost. Yes, that’s an actual thing – and it can help you book more reservations and earn more money. The Airbnb Superhost program rewards experienced and top-rated hosts with travel coupons and an extra 20% on referral bonuses. Superhosts also get a badge on their listings and gain more visibility to guests by having their listing placed at the top of search results and featured in emails. There’s also a superhost search filter for guests who only want to work with top hosts.
“You become a superhost when you have the experience, a number of great reviews, a good record of responding quickly and if you don’t cancel on people,” says Laura, who has reached superhost status herself.
Making your home an Airbnb requires some work and an ability to open your home and mind to strangers from around the world. If it’s the right option for you, it can be a lucrative adventure. Whatever your living quarters, it’s simple to sign up and start renting. Just make sure your lease, homeowners insurance, HOA or local laws allow it. If you want a bigger space to rent, talk to a Rocket HomesSM partner agent today to begin your search for a perfect home for you and your guests. Who knows, you could even make enough as an Airbnb host to cover your mortgage each month.