Renting on Airbnb is a daunting leap to take, especially when bills are mounting or you need some costs covering. One of the first questions would-be hosts ask is “How much can I earn on Airbnb?”
When I first started hosting, I honestly didn’t know what to expect or how successful it would be. My first booking happened about 2 weeks from going live in August of 2021. That one-off 5-day booking paid the mortgage for that month.
Within 24 hours of the guest checking in, I got the full booking payment in a lump sum. From that moment on, I was instantly hooked. It was by far, the easiest money I’d ever made. All I had to do was tidy and clean my property and put clean sheets on the bed.
At the start of my Airbnb journey in renting out my 1 Bedroom flat, I was more than happy to have my mortgage covered. I had expected only one or two bookings a month (which I would have been happy with). In the beginning, I had little competition in my local area and there was only a handful of 1 Bedroom apartments nearby. None of these were as nicely furnished or developed as mine which was new and modern.
Fast forward to a few years later and the availability of properties in the area has exploded. Partly as more and more people join the platform as hosts driven by the huge growth in Airbnb awareness. What’s more, this growth has rapidly kept up with the increase in demand for stays in the local area. According to Airbnb statistics on my account, searches for stays in my town in 2023 have increased by 136% on the previous year. This is a huge increase year on year – and it keeps growing.
So how much can I expect to earn?
The truth is, it’s difficult to determine how much you can make on Airbnb without knowing several factors. I.e, what you have to offer, where in the country it is, your local amenities and tourism pulls, whether there is demand for that area, whether there are hotel choices nearby and lastly how much other short term rental competition is around you. Having said this, I think you’ll be surprised at how much spare income you can bring in.
Most hosts rent out a spare bedroom and this is a great way to help cover costs in your home. In my area hosts charge anything from £38 up to £80 for a single night stay in their spare bedroom. This varies from between £110 to £383 for full properties with the average nightly price being around £160 for a 1 Bedroom property.
My experience
My nightly rate varies all the time and has varied since I first started. I will usually have a nightly rate of around £129 but this increases to up to £159 and goes down to £109 depending on the time of year and whether I notice a reduction in bookings.
This pricing structure and my current circumstances means that I only need about 4 bookings a month to cover the mortgage. When I first started, my first few months were busy and I regularly had about 8 bookings a month.
Due to my work circumstances and schedule, I adjusted my availability and got more selective with my bookings. This reduces the occupancy in a given month.
I’m lucky in that my area doesn’t seem to be hugely governed by seasonal bookings either. I have pull factors at my property for both summertime and wintertime so don’t see a lull. A bad month for me is usually about 3-4 bookings. This equates to about £400+ a month, an average month is £600+.
The great thing about hosting on Airbnb is that with the exception of a mortgage – which you’d be paying anyway – your costs to physically host are actually very low. Your only real expenses are the cleaning of linens, additional electricity, and home cleaning.
You’ll notice you’ll get more bookings and more income if you can undercut local hotels or B&Bs. That is, if you have any professional local competition at all.
If you live in a remote location or small town with limited B&B’s or hotels you can do very well.
If you live in a town or city, or have local tourism pulls that encourage people to visit your local area, you’ll have no issue with getting bookings.
Good transport links into tourism areas, such as a property on the outskirt of a major city, will be an attractive location for travellers. You’ll find many people search for a bargain outside expensive city centres. Finding your USP or ‘unique selling point’ particularly in a highly competitive area is what will set you apart from the rest.
Every host can find their place and get bookings.
It’s a fundamental step of booking to do some research on the other properties in your local area. You can see beforehand what else is being offered and what your competition is. Don’t be put off if all you see is modern, highly stylish apartments if all you have is a tired spare room. There is a market for everyone. You can make a killing catering to a different crowd who won’t want to spend £150+ a night on a rental. There will always be someone looking for your property within their budget.
Charging £49 a night for a spare room in the right area can see you undercut your local chain hotels. This way you can also stay booked regularly throughout the month.
The great thing about hosting on Airbnb is that you pretty much have control over your success. You can decide how many bookings to take and how often you are available.
Offer your rental super cheap and you’ll be busy the whole month and your calendar will be fuller. Price your rental a lot higher and you can be content with one or two bookings a month.
This is great for someone with a busy schedule, but that wants to earn a little bit.
Just because your property or room is a cheaper price, doesn’t mean you should skimp on the cleaning too. The most important thing to remember is to give guests a sense that they are getting a good deal. If your property and location seem like a good deal and your property is repeatedly documented as clean, your calendar will fill with reservations.
Full time incomes
I know that I ever want to ramp up my hosting to a full-time venture, I could do so easily. If I open up my calendar and drop the price I can expect anywhere from £1,200- £2,000 in revenue each month. That in itself is a very tame estimation.
This is more than I could earn renting out the property via an estate agent or with a long-term tenant. For a long term contract, I could expect between £700-£800 a month. Plus with short term rentals, there is a good chance I wouldn’t have someone living there for the full 30 days of the month.
If I dropped the price, accepted every booking and cut down my turnaround time in between bookings I believe I could expect £2,000+ per month in my location.
I could rent my place out very cheaply and know it would stay booked the whole month. But the constant wear and tear in my home at such a low price, coupled with my work schedule, wouldn’t make it worth it for me.
That’s just my opinion and that’s just for my life right now. If my situation changed and I found myself on the brink of losing my home I’d be opening up my settings to welcome everyone.
If you have a spare property sitting there that needs filling consider Airbnb. Short term rentals can be more hands on than a long term tenant contract. However in the long run, it’s much more rewarding financially.
It’s not just homes
What’s more, Airbnb has expanded beyond overnight stays. ‘Airbnb experiences’ are allowing those with skills to host tours for tourists, teaching classes or tutorial sessions. It’s now easier than ever to start a business with reduced capital.
All you need it simply your passion and knowledge on a subject and the creativity to create something fun for people to do. Guests can book and show up to your group session, whatever that may be.
There’s no doubt that hosting with Airbnb, VRBO or other platforms is a great way to get a second income. Don’t get me wrong, running a short term let on Airbnb has its faults – it’s not all plain sailing. Hosting can be difficult at times, guests and guest behaviour in particular is a major frustration. But this is massively outweighed by the financial potential at your fingertips.