The Airbnb ecosystem is experiencing a boom at rates that the traditional hospitality industry could only dream of. As of 2018, Airbnb’s $10 billion revenue rivals many individual hotel chains. For a company that doesn’t own a single property, it’s pretty impressive.
However, for those who want to participate in the Airbnb boom there might be one roadblock: owning real estate. If you don’t own your own property, you might think that the Airbnb riches might pass you by.
Don’t fret. There’s actually a way to make money on the Airbnb platform without owning real estate.
Airbnb rental arbitrage
Have you ever rented an Airbnb from someone who lives in an apartment complex? You know that they don't actually own the property but they are renters, much like you are, as an Airbnb guest.
In this case, their landlord may or may not know if they are subletting their space on Airbnb. Most times these types of situations fly under the radar and don't cause any problems and sometimes they do.
However, there is a growing group of Airbnb entrepreneurs who are engaging in Airbnb rental arbitrage. That's where you rent a property for the sole purpose of letting it out on Airbnb or some similar short-term rental platform.
In this case, not only is it advisable that you alert the landlord of your intentions but you should also loop them in on your Airbnb plans in some way or another. This may be drawing up a contract or having some other mutual type of understanding. Both parties should be aware of the expectations and agree on the terms of the lease for Airbnb rental purposes.
For this arrangement, you'll have to furnish the place and add other knick-knacks that make it a hospitable space. (Check out Airbnb host tips or Airbnb checklists for guidance in this area.) Depending on your arrangement with the landlord, you may have to come up with a security deposit and/or move-in fee, too.
Host an Airbnb experience
Airbnb experiences are a nice addition to the Airbnb platform. Airbnb experiences are local tours, getaways and excursions that can be booked directly on the Airbnb platform. As an experience host, you get to set your own hours, prices and how the experience will ultimately pan out (within Airbnb guidelines.)
You don't have any upfront cost other than what it might take for you to rent a venue or provide materials related to the experience. However, there are many successful Airbnb experiences that include walking or biking tours, conversations and even people watching activities that cost nothing more than a host’s time.
The platform gives hosts more visibility and even the option to collect payments and set their schedule with patrons who are interested enough in tours to book and pay ahead of time. It's a win-win and a truly lucrative way to participate in the Airbnb economy without owning any property.
Be an Airbnb co-host
A great deal of Airbnb hosts that own property might actually live out of town. In this case, they may work with a local property manager that acts as a co-host. This person may manage the day-to-day management of the Airbnb listing.
For example, they will meet guests, take care of concerns they have while there, arrange for cleaning upon guests turnover, and handle any other details of managing the property. The Airbnb platform allows for hosts to add a co-host and even manage permissions in terms of what type of information co-hosts can have access to in Airbnb dashboard.
As an Airbnb co-host, you should have some experience managing properties or at least being in the hospitality industry. You can set your rates hourly or as a percentage of Airbnb revenues the host brings in.
Provide hospitality-related services
Beyond property management and co-hosting, there are other services that you can offer to Airbnb hosts that centers around the actual Hospitality experience for their Airbnb listings. For example, you can offer cleaning services that are especially designed for Airbnb properties.
You could offer interior design Services that bring out characteristics highlighting a listings location. For example, if you are working on a listing that is a beachfront property you could provide interior design that focuses on nautical and water-related design themes.
Many Airbnb hosts are now offering meal services as an option for guests. You could be a caterer or cook for small or large parties during their stay in a hosts property.
Just like in the traditional real estate industry, there are plenty of services that can augment what an Airbnb host has to offer. if you are creative you can probably find plenty of ancillary services for local Airbnb hosts you’d like to do business with.
Provide marketing services
Again just like traditional real estate in hospitality businesses, there will always be a need for marketing services. I've seen plenty of Airbnb hosts who have either an entire Instagram account for their Airbnb business. Or they may even create separate Instagram accounts for each unique listing they manage.
Though the Airbnb platform offers many opportunities to be seen by potential guests, it doesn't hurt to find additional ways to market properties off the platform. If you are someone who has a knack for social media and even success with paid traffic, providing a highly specialized service that focuses on the short-term rental market could, indeed, be a lucrative venture.
Aspiring to superhost
Hopefully, these ideas inspire you to find a way to work within the growing Airbnb economy. If you really want to be an Airbnb host but don't own your own property, earning money in a number of these ways can help you eventually get the capital you need to own your own Airbnb rental property.
Either way, do your best, save your money and you, too, could be a profitable, Airbnb superhost one day!