When I was paid that $600, I just stared at the bank deposit. Cha-ching! I was so pumped that it worked.
Isn’t it strange how fast we can go from fear to elation? I experienced a mini mental gold rush that went like this.
“I am going to camp every weekend and rent my place out. I could make an extra 15k per year living in a tent. I love camping. Let’s do this!”
“I am buying a cheap RV and living in it while people are at my place. Brilliant!”
“I am going to stay with friends, split the money and milk this cash cow.”
“It’s only a matter of time before I have a real estate empire.“
If you are like me, easily excitable and with an imagination that gets ahead of itself, you understand this. The reality is different.
Below are 15 of the Airbnb realities that set in after my initial dreams of grandeur.
- I had to spend money to make money. No one wants to use the towels I’ve been using for seven straight years. The same goes for the sheets, the wash clothes, etc. I also bought little things like a coffee maker, a hair dryer, extra keys, travel toothpaste and soaps.
- You have to clean. You see, I have a gift. I have the gift of not seeing dirt. It’s a wonderful gift. Sometimes. However, upon realizing that people were coming, I began seeing dirt EVERYWHERE. I probably spent four hours cleaning things that hadn’t been cleaned in a long time. Ok, ever. Things like my bathtub, shower curtain, refrigerator (don’t those clean themselves?) and I could go on and on.
- You have to STAY clean or end up cleaning like crazy each time. To be honest, this was a radical change for me and suddenly my mom’s voice was haunting me daily. “If you clean little by little Kyle, it’s a lot easier in the long-run.” Fine, it’s true. I admit it.
- To do a great job, you have to pay attention to the small things like labeling keys for guests, finding a lockbox, making sure neighbors have a key in case of emergency, providing detailed instructions, type up a welcome booklet going over the neighborhood, leaving coffee, bagels and OJ for their morning refreshments, popcorn for snacks, etc.
- You have to remove personal items and valuables. I moved ALL of the things I absolutely didn’t want stolen or looked at to a neighbor’s house. This is kind of a pain at first. Thankfully, my awesome neighbor who I wrote about here let’s me do this.
- You have to follow up with your guests or meet your guests when they arrive. They may also call you with questions when you aren’t expecting them.
- You have to clean when you get home. Change the bed, wash the linens, etc. Didn’t I already clean right before I left? Ahhhhh.
- You have to initiate reviews and request that guests review their experience. You also have to create and maintain a great profile. This all takes time.
- You should slowly upgrade your place to make it visually appealing. You don’t have too, but you will want to. People want to stay in interesting places. That means art, design, etc.
- You will have to figure out pricing. Too high? Too low? Can I raise my rates once I get better reviews? What’s the competition?
- Staying at a friend’s house is unsettling. You have to pack up, move out, and if you forget anything, too bad. It all takes too long. Also, your place isn’t yours anymore, at least temporarily.
- If you camp for the weekend, you have to weigh the benefit of getting nothing done and possibly having to camp alone. Or in unforeseen bad weather.
- Where am I going to store an RV? I have to be honest. I still love this, and if I didn’t live in a loft would consider it even though it is ridiculous.
- This is not the way to get into real estate. This guy bought an apartment to rent out, but in my opinion, it is not sustainable, too risky in terms of breaking hotel laws, ticking off neighbors, and the biggest reason…This is not what Airbnb is all about!
- If you don’t like hosting, this is not for you. I like hosting. I recently met a great couple from Charleston and I’ll look them up if I am ever in Charleston. I really enjoy the warmth of these connections.
There is a lot more that goes into this than you would initially think. It is not passive income. If you want that, invest in Coke and collect dividends.
Here is the way I think of it.
First of all, I do this to support the shared economy, because I think the way American’s do life in general needs to shift. Share more, buy less, be kinder, collaborate, be neighborly, etc. Culture needs to shift.
Secondly, from a pure business standpoint, Airbnb is creating a marketplace. As more and more people begin to hear about Airbnb, the supply of places will likely outstrip demand, because it is very easy to sign up. They even send out a photographer to your place to take pictures. Most people will experience the same gold rush mentality I did. They will price low to get reviews, driving down prices.
The only way to stay in the game long-term is to do a fantastic job for your guests, genuinely enjoy hosting (I really enjoy it), commit to do the hard work up front, and build a system to make sure things go efficiently and smoothly to make it worth your time without sacrificing the personal touch.
In my next posts about Airbnb, I’ll share with you details of how much I made, how much you can likely make, and how to develop a system to make it all worth your time.