In the ﬁrst two parts of this article series, I discussed some of the pros and cons of becoming an Airbnb rental host as well as shared a few resources which can allow you to run your Airbnb vacation rental virtually hands free, using some state-of-the-art tools.
As I mentioned earlier in this series, studies show that some of the most proﬁtable Airbnb locations and attractions in any city include colleges and universities, festivals, concerts, plays, sporting events, large employers, medical facilities, hospitals, and nature areas for hiking and biking.
Based upon this information alone, it isn’t hard to understand why the city of Phoenix hosted nearly 44 million visitors in 2017. So if you’re a buy and hold investor, you may want to do a bit of research to determine whether or not your rental property would produce considerably more cash ﬂow as a vacation rental.
As such, it is important that we discuss how you might go about determining where to purchase a short term rental property here in the Phoenix area. We already know that a home’s proximity to attractions, sporting events and outdoor activities is important. And if you’re familiar with the area, I’m sure you already have a good idea of where to begin.
If not, a simple google search of “popular tourist attractions in Phoenix” is a great place to start. You can then search Airbnb for hosts in those speciﬁc areas to see what the average nightly rate looks like. HINT: Leaving the booking dates un-selected will show the days
the property is available. Obviously, a lot of unavailable days is a good indication of a high occupancy rate for a particular property, as well as for the general area.
You can also use a little known service called Airdna to locate popular Airbnb areas. I won’t spend too much time talking about this service other than to say that it is a very robust system which pulls data directly from Airbnb. So if you want to ﬁnd out the top 10 Airbnb rentals in Scottsdale, for example, the information is readily available. Complete details can be found at www. airdna.co.
Once you have determined a great Airbnb location, now it’s time to use our Smart Map Comping System to locate “ready to rent deal properties” in that area.
Smart Map allows you to see what comparable properties are currently renting for. So if the data shows 2 bedroom condos in Scottsdale are renting for $1500 per month, the daily rate would be $50.
But if your Airbnb research shows the average nightly rate for 2 bedroom condos, located in the same area are averaging $200 per night, would that pique your interest?
Of course it would! Because even at a very conservative high vacancy rate of 50%, or $200 per night, you’d stand to pull in $3000 per month before expenses, instead of just $1500 per month.
Obviously, all Phoenix area properties are not cash cows when it comes to Airbnb. In fact, I would say it makes a lot more sense to sign a lease with a long-term tenant in most cases. But there are deﬁnitely pocket areas in the Phoenix and surrounding areas that are worth investigating further.
I hope this article series has shed some light and helped you to start thinking outside the box when it comes to determining whether becoming an Airbnb host may be right for you.
In closing, I’d like to let you know that we have produced an entire video series called, “How You Can Get Wealthy In Real Estate The Smart Way,” which is readily available on our website. The series includes an entire segment on Airbnb.
To get immediate access, and to get more information about our Free Smart Map ARV Comping System, be sure to visit us at TheEquityFinders.com today!
by Laura Leatherdale