How to make your first one million Naira as Airbnb Host
If you are on this page it only means one thing and that is: you want to know how to be an Airbnb host. Perhaps, you are already an Airbnb host and you are looking for a way to improve your income and possibly bring in your first six figures being Airbnb host.
Well, Lekki estate sales got you covered as this guide will expose all the secrets you need to know being an Airbnb host. Even if you are considering a change in career and taking up the Airbnb host job fulltime.
Without further ado let’s dive in as I promise this will be a very enlightening article you will ever read about starting an Airbnb host business.
Airbnb is an online marketplace that connects people looking to rent their homes with people looking for accommodation in the area. It currently covers more than 81,000 cities and 191 countries around the world. The name of the company comes from “Air mattress B & B”.
For hosts, participating in Airbnb is a way of generating income from their property, but with the risk that the guest will harm them. For clients, the benefit may be relatively inexpensive accommodation, but with the risk that the property may not be as attractive as the listing suggests.
What are the pros of Airbnb
- Wide Selection
Airbnb hosts list many types of properties on the Airbnb website – single rooms, a suite, apartments, moored yachts, houseboats, entire houses, even a castle.
- Free registrations
Hosts don’t have to pay to list their properties. The lists can include written descriptions, photos with captions, and a user profile that allows potential guests to learn more about the hosts.
- Hosts can set their own price
It is up to each host to decide how much to charge per night, week, or month.
- Customizable search queries
Customers can search the Airbnb database not only by date and location but also by price, type of accommodation, amenities, and host language. You can also add keywords (for example, “near the Louvre”) to further define your search.
- Additional services
In recent years, Airbnb has added experiences and restaurants to its offering. In addition to a list of available accommodations for the planned travel dates, people searching by location will see a list of experiences, such as courses and tours, offered by local Airbnb hosts. Dining options also include reviews from Airbnb hosts.
- Protection for guests and hosts
To protect customers, Airbnb will hold the customer’s payment for 24 hours after check-in before the funds are released to the host.
For hosts, Airbnb’s Host Guarantee program “provides protection for up to $1,000,000 in damages to covered property in the rare event of guest damage, in eligible countries.”
What are the Cons of using Airbnb Services
- What you see may not be what you get
Booking accommodation with Airbnb is not the same as booking a room with a large hotel, where you can be reasonably certain that the accommodation is as advertised. Individual hosts make their own announcements, and some may be more honest than others. However, previous clients often post comments about their experience that can provide a more objective view.
Check the reviews of other guests who have stayed at this Airbnb hotel to make sure the list is accurate.
- Possible damage
Probably the greatest risk for hosts is their property being damaged. While most stays are uneventful, there are stories of entire homes being searched by dozens of night owls when Airbnb hosts thought they were renting out to a quiet family. Airbnb’s Host Guarantee Program described above offers some insurance but may not cover everything, such as: B. Cash, rare works of art, jewelry, and pets. Hosts whose homes are damaged can also experience significant inconvenience.
- Additional costs
Airbnb charges a number of additional fees (like hotels and other accommodation providers, of course). Customers pay a 0% to 20% customer service fee on top of the booking fee to cover Airbnb customer service and other services. Prices are displayed in the currency selected by the user if Airbnb supports it. Banks or credit card companies may add fees if necessary
While the offers are free, Airbnb charges a service fee of at least 3% on each booking to cover the cost of processing the transaction.
Hosts and guests from the European Union, Switzerland, and Norway may be subject to Value Added Tax (Value Added Tax) .1 Depending on their location, hosts may be subject to rental income tax. To facilitate tax compliance in the United States, Airbnb collects tax information from hosts so they can create an account of their income using Forms 1099 and 1042.2 each year.
- It’s not legal everywhere
Before listing their properties on Airbnb, prospective hosts should check their local zoning regulations to ensure that renting their properties is legal. Hosts may also need to obtain special permits or licenses.
The Risks and Rewards of Making Money With Airbnb
This Peer-to-peer short term rental services like Airbnb are becoming an alternative for many travelers. Some travelers want to feel at home. Others are looking for accommodation for large groups in one place. Short-term peer-to-peer rentals are also viewed by many as a cheaper option than the standard hotel room. If you are planning on following the trend and renting a room or an entire house, here are some things you should know first.
How to List With Airbnb
You decide when and at what price you want to make your space available. The list is free and you can approve potential guests individually. When setting your price, consider the price in your area when looking at competing offers. You should consider hosting costs – including cleaning, higher utility bills, taxes, and Airbnb hosting fees which are 3% for payment processing.
Your guests pay the Airbnb reservation fee of 6% to 12%. Make sure you understand Airbnb’s accommodation standards to get accurate listings, communicate with guests, meet your booking obligations, clean your accommodation for each guest, and provide amenities basics like soap and toilet paper.
You should tidy up your space before photographing it to show it in the best possible light. In most cities, Airbnb even sends a professional photographer to capture your spot for free if you’re an active host.
As you describe your place, think about what makes it unique and try to see it from an out-of-town visitor’s perspective.
Is your accommodation within walking distance of public transport? Is it near great restaurants, nightlife, or cultural activities? What amenities can you offer: WiFi, fully equipped kitchen, cable TV, outdoor terrace? Your ad will appear on the Airbnb website, and you can also promote it through social media or your own website.
Legalities and Taxes involve in Becoming an Airbnb Host
You may need to get approval before posting your address on Airbnb. If your property is controlled by a home owners association or cooperative, check their rules to make sure you are allowed to host. When you rent, you want to receive your landlord’s blessings. Airbnb suggests adding a confirmation to your contract with one of these agencies to specifically deal with hosting through Airbnb.
In addition, your location may require a business license and you may owe local taxes on any income you earn. For example, you may have to pay a transitional occupancy tax that also applies to hotels. Hotels typically pass this tax on to their guests: you can remember the extra 12% added to your bill the last time you stayed. You can check Airbnb’s information on regulations for many cities.
You’ll also owe federal taxes on Airbnb income, which will be reported to you and to the IRS on form 1099. However, you may be able to reduce your taxable Airbnb income by deducting business expenses, such as cleaning fees and insurance.
How to be safe as an Airbnb Host
If you rent out your home when you are not there, it is unlikely that you will face physical violence. However, you want to find a safe place where you can keep anything that has high sentimental or financial value. Your wedding dress, your grandfather’s gold watch, photo albums, emergency money, and income tax returns are examples of things you might want to secure. Don’t give your guests a chance to steal your belongings or identity.
It becomes more difficult if you rent out part of your house and still live there. You can keep a closer look at your belongings (although you are always smart to protect them), but you are physically vulnerable if your guest turns out to be dangerous. It is unrealistic to check customers’ criminal backgrounds before booking or checking in. You can do basic internet research, but it is not a security process.
Reviews from previous hosts can put your mind at ease, and you can still decline or even cancel a reservation, despite Airbnb penalties in some cases. You can also limit the reservations you accept to customers who have completed the booking process. Airbnb verified ID. Hosts and guests can ask Airbnb to verify their identity by uploading a valid government-issued ID and linking a Facebook, Google+, or LinkedIn account to an Airbnb account.
Insurance and Liability you Need as an Airbnb Host
Speaking of liability, let’s talk about insurance. Airbnb’s Host Guarantee provides coverage of up to $ 1 million for property damage in 29 countries including the US, UK and Canada. Airbnb insurance is not a substitute for homeowner or tenant insurance and does not protect against theft or personal liability.
Talk to your landlord or the renter’s insurance company to make sure your policy covers your property, possessions and liabilities when renting your home through Airbnb. If you need additional coverage, an umbrella policy might be the answer.
Airbnb offers liability insurance for American guests. It offers up to $ 1 million per event and is secondary to other insurance such as your homeowner’s policy or your landlord’s insurance that might cover the incident.
Like any insurance policy, Airbnb liability insurance has its terms and limits.
Airbnb’s Host Guarantee does not protect against wear and tear in your home. However, you can leave a deposit to cover possible damage.
It is important that you inspect your property after each guest leaves. Otherwise, you will not be able to know which guest caused the damage and you will not be entitled to make a claim.
You should document the damage with photos and justify the prior value of the damaged property. With Airbnb, hosts must first try to resolve issues directly with guests before filing a complaint. To file a lawsuit with Airbnb for more than $ 300, you must first file a police report. The hosts have a limited window of time to file a complaint: 14 days or before the next guest arrives, whichever comes first.
Airbnb host Payment Guarantees
Can a guest stay for the night without paying you?
Customers actually pay you through Airbnb. As long as there are no issues, Airbnb will clear your payment within 24 hours of your guest’s arrival and you will receive it within a business day if you choose to be paid via PayPal or using the Payoneer prepaid debit card within a few days for a bank transfer or within 15 working days for a check in the mail.
Customers must notify Airbnb within 24 hours of check-in if an issue warrants a refund. If you fail to respond to customers trying to contact you about a problem, they may be able to complete their reservation and receive a partial refund.
Airbnb may ask you to refund a guest’s payment if you cancel a last minute booking, forget your key, misrepresent your listing, fail to clean your home, or fail to meet Airbnb standards for hospitality.
Airbnb recommends making sure you are available within 24 hours of your guests’ scheduled check-in to resolve concerns as many issues are easily resolved. In your ad, make sure you accurately describe your room type, number of bedrooms and bathrooms, and amenities. If you provide bed linen and towels, make sure they are clean.
Also, note whether there are any animals on the property.
You could also get burned arranging payment with a guest outside of the Airbnb website. A guest may try this to avoid paying Airbnb guest fees or you may consider kidding you. As a host, you can only save 3% if you don’t go through the Airbnb payment system. Airbnb may refuse to do more business with you if you get caught. So don’t try to bypass the system.
Being an Airbnb host is a great way to make a good income. Whether you are listing an extra bedroom in your basement, an entire vacation home, or even a visit or on-site experience, you can make enough money to pay off part of your mortgage or finance your retirement.
Being a host isn’t always easy and it will likely be a lot of work if you do it regularly, but it can certainly be financially rewarding, besides being a fun way to meet interesting people.
Many of these options require you to be comfortable with unclear local laws, sharing your most valuable assets with strangers, and assuming additional legal responsibility. Airbnb is no exception, but it can make thousands of extra dollars a year if you are willing to take risks.