AIRBNB: A viable option to increase income for homeowners?
Category Property Advice
“This topic of conversation is arising more and more amongst my clients and is a serious point of interest with homebuyers,” comments Jennifer Huber of Upton Properties (pictured).
“As life going forward becomes increasing costly, it can be comforting to know that your primary residence has an opportunity of sustainable additional income each month. It can also be a good way to boost your retirement income. But, while Airbnb provides an excellent service in terms of publicity, safety measures and home insurance, all tax and planning obligations are left entirely in your hands. So, homeowners that take advantage of these services need to be careful they are not breaking any rules,” states Huber.
“For example, while it may not be necessary to get permission to rent out your home, there may be clauses in your home insurance,” she says.
Airbnb is a trusted community marketplace for people to list, discover, and book unique accommodation around the world – online or from a mobile phone. It can also be safe, easy and convenient way to share your home with people from other parts of the country or the world.
“But the benefits of becoming an Airbnb host go far beyond earning extra income”, says Nicola D’Elia, General Manager for Africa and the Middle East at Airbnb. “It’s a perfect way earn income while doing something you love – meeting strangers from around the world and sharing your home and country with them. It’s also an opportunity to meet interesting people from different places and cultures while showcasing the best your city and country has to offer.”
‘The typical South African Airbnb host who occasionally shares space in their home boosts their yearly income by more than R28,000,’ was amongst boasts made in the first data release on the Airbnb community in South Africa issued in June this year.
It also said the 134,000 guests who have stayed ‘in a listing on Airbnb in South Africa in the last year alone represents a 250% increase in travelers on Airbnb compared to 2014’.
So how easy or difficult is it to become and Airbnb host?
Let’s look at the basics:
Airbnb prides itself on being built on trust, with safeguards to protect homeowners from a range of risks when sharing your home:
• Both guests and hosts have a profile with a picture.
• After a trip, everyone gets a chance to write a review – which keeps guests accountable for treating hosts and their homes with respect.
• For further peace of mind, Airbnb’s Host Guarantee Insurance is designed to protect you from liability in case your guests get hurt or cause property damage. It’s automatically included as part of your Airbnb account.
Airbnb also strives to simplify your life by taking care of administrative details:
• This includes handling the payments so you needn’t handle money issues with your guests.
• Guests pay Airbnb before they arrive, and Airbnb pays you 24 hours after they check in. Listing on Airbnb is free.
• Fees to Airbnb are deducted as a 3% host service fee on each reservation.
Airbnb also has specific tools and resources that can assist you to:
• Write a great listing description
• Prepare your home
• Choose a price point. (this factors in travel trends and pricing for similar offerings)
Interesting Airbnb data released for 2015 included:
- Hosts and guests on Airbnb are older than one might think with the average host being 44 years old and guests being 37
- There were 7500 active hosts in South Africa and almost half were freelancers‚ entrepreneurs‚ or self-employed” while “66 % of hosts share space in their primary residence in 2015”
- Cape Town proved to be the most popular destination, with Knysna second in 2015
- 99 000 South African residents used Airbnb for their travels in 2015
- Airbnb guests stay an average of six nights
- More than 40% of guest spending takes place in the neighbourhood where they stay”; and
- 58% of Airbnb guests visited local businesses based on host recommendations.
D’Elia said it “is good news for everyone‚ providing an economic boost for thousands of South Africans‚ helping them make ends meet and support their families by hosting on Airbnb." It’s also got the nod from Tim Harris (himself an Airbnb host)‚ the CEO at Wesgro‚ the tourism‚ trade and investment promotion agency for Cape Town and the Western Cape.
Author: Upton Properties
