Yahoo Finance How to Make $5k a Month in Passive Income Through Airbnb
Generating passive income through Airbnb can be a lucrative endeavor if approached strategically. Here’s a quick guide on making $5K a month through Airbnb, drawing from successful strategies experienced hosts use.
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Your Airbnb Investment
The first step is ensuring the market has a demand for your listing. Sure, a mansion sounds like a great place to host guests. But you won’t get much business if it’s in the middle of nowhere.
Boris and Susan from Build Your BNB, mention a property that yields an average of $5k per month, costing them $300,000 in the Twin Cities with 4 bedrooms and 2 bathrooms. This property is a 15-minute drive from the local airport, downtown area, and business district.
When looking for your Airbnb investment, you’ll want to look at location, cost, and how much work you’ll have to put into setting it up for guests.
Setup Costs
Susan and Boris mentioned that their setup costs included renovations, furnishing, and closing costs for the property. For their Twin Cities property mentioned above, their setup cost was an additional $28,000 on top of their $60,000 downpayment (20%) for $88,000.
These costs can vary depending on your unique situation. Airbnb hosts can expect to pay anywhere from $15,000 to $30,000 in setup costs.
The Math
According to Jerry Xiong, an experienced Airbnb host with 9 properties, his monthly operation costs include cleaning, utilities, supplies, and mortgage. In his particular scenario, he claims an average of $7,590 in monthly revenue with a monthly income of $3,440 after expenses.
If your goal is to make $5,000 in profit per month, you’ll have to consider operation costs and adjust accordingly. Thankfully, there are ways to optimize your job as an Airbnb host so you can focus on expanding your business.
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How to Make a Profitable Airbnb Business
“Passive income” implies that every hour you work is not tied to a fixed income. If you want to make your income grow exponentially, you’ll have to automate your hosting services. This is what separates amateur hosts from professional hosts.
PriceLabs is a price management tool that allows you to adjust the price of your listing automatically each day based on the demand at that particular time. This allows you to ensure maximum revenue.
Smartbnb.io is a communication tool that allows you to automate all of your guests’ check-in and check-out communications. It can handle hundreds of different types of questions, including parking, early check-in, and much more, to save you time.
Automating all of the routine steps of your Airbnb business will allow you to scale exponentially.
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This article originally appeared on GOBankingRates.com: How to Make $5k a Month in Passive Income Through Airbnb
