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The Airbnb business niche has attracted many entrepreneurs in recent years. And it's not surprising, given all the benefits of being an Airbnb host. You get to be your own boss, set your schedule, and make good money in the process. What's not to love?
Some people love it so much that they want to make their Airbnb side hustle into a full-time business.
If you’re one of those, you’re in the right place. Let’s go over the steps you need to make it work.
What Is Airbnb, and How Does It Work?
Airbnb is a California-based online marketplace with more than 4 million hosts and 54 million active bookers. It connects people who need a place to stay with those with an extra room (or an entire home) to spare. It's the largest home-sharing company in the world and is one of the original proponents of the sharing economy.
If you're new to the Airbnb scene, you're probably wondering how it all works. It’s pretty simple. You only need to create an account on the Airbnb website (or app), and once done, you can start listing your property.
To list your property, you'll need to add some photos and a description. You'll also need to set a price and choose the dates your property will be available. When the property is listed, just wait for the bookings, then start accepting guests.
From Side Hustle to a Full-Time Business
A side hustle is a great way to make extra money while having a day job. But not all side hustles are created equal; some can present a more significant potential to make a lot more money. Or some people just enjoy a side hustle so much that they want to do it full-time.
Whatever the case, if you feel this is true for you, it might be time to make the transition. But the question is: Is it worth your time and effort to turn your Airbnb side hustle into a full-time business?
The answer to that question depends on several factors, such as how much money you're currently making from your side hustle, how much time you're willing to put into growing your business, and whether or not you're comfortable with the risks involved.
If you're currently making decent income from your side hustle and you’re willing to work to grow your business, then turning your Airbnb side hustle into a full-time business could be a great idea.
Questions to Ask Yourself Before Making the Transition
Transitioning from a side hustle to a full-time business is not a decision you should take lightly. So answer these questions honestly before taking the plunge.
- Are you prepared to work hard? Any business takes a lot of work, and an Airbnb is no different. If you can’t put in the hours, the business might not be for you.
- Can you handle the financial risks? Not only should you be prepared for the financial risks running a business entails, but you should know which risks you’re prepared to take.
- Are you ready for the responsibility? The bigger the business, the bigger the responsibility of running it.
- Is it the right time for you? There will never be a perfect time to make the transition, but you must ask yourself if it's the right time. Some find the “right time” when their business has grown, making them more money than their primary job.
- Is it worth it? This is a question only you can answer. You need to decide if the benefits of running a successful Airbnb business are worth the risks and challenges.
A Step-by-Step Process From Turning Your Airbnb Side Hustle Full-Time
If you’ve answered positively to all those questions above and you think you’re ready to take your business to the next level, here’s what you need to do:
Step 1: Create a business plan.
The first step is to craft a business plan. This may seem like a no-brainer, but having a clear vision for your business is essential. This requires having clarity on many business questions like:
- What are your goals?
- How will you achieve them?
- What are your expected costs and revenue?
- Will you offer additional amenities not included in the booking price?
- How much will you charge for those amenities?
- Will you accept alternative forms of payment like cryptos, or will you stick to the classics like standard or prepaid credit cards?
- Are you planning to own properties, perform rental arbitrage, or be a property manager?
The answers to these questions are essential for drafting a clear roadmap that will take you from where you are to where you want to be. For example, performing rental arbitrage and becoming a property manager are two ways to create a full-time Airbnb business with little investment.
Step 2: Find a unique Airbnb niche.
As we mentioned before, finding the right niche is crucial when first starting out. This can help you attract the right guests and get better rates. Niches within the Airbnb market can be anything from family- or pet-friendly rentals, cabins deep in the woods, modern lofts in big metropolitan areas, simple, low-cost solutions for digital nomads, or luxurious villas surrounded by vine fields.
Step 3: Build up your reviews.
Social proof is one of the most important marketing tools for Airbnb-based businesses. The best and most honest way to do this is to provide an excellent experience for your guests and ask them to leave a review.
Step 4: Develop a marketing plan for your property.
After securing the right property or properties, marketing is the next most important thing because operating rental properties is a highly competitive space. There are great ways to market your listings, including social media, paid advertising, and email marketing, each with its pros and cons.
If you’re not familiar with digital marketing, you may have to hire someone who is. It’s fairly easy to find great talent on sites like Upwork and Freelancer.com. If you have the budget, you can even hire an agency.
Step 5: Hire a property manager.
As your business grows, you will need some help managing day-to-day operations. This includes hiring a property manager to handle guest relations, bookings, unit access, and maintenance. Remember, your quality of service reflects your business, so hiring someone professional and trustworthy is essential.
Step 6: Continue building your brand.
In any business, you need to stand out. This requires establishing a strong brand with a USP—a unique selling proposition—and a brand that people can come to know and trust.
Pulling this off requires constant work, coordinated marketing, consistent branding, and all interactions with paying customers or guests.
Benefits and Challenges of Making the Transition
As with all business decisions, there are both pros and cons to running your B&B as your sole or primary source of income.
Many benefits come with making the transition from an Airbnb side hustle to a full-time business:
- You'll have more control over your business. When running a business, you can make all the decisions about how it's run (for better or worse).
- You'll have more control over your income. By running Airbnb as a full-time business, you can earn more money than you would otherwise. You can also work to grow your business as much or as little as you want.
- It's fun. Your mileage may vary as far as “fun” is concerned, but running your own business is usually an exciting experience. If you're passionate about what you're doing, it won't feel like work and be much more rewarding.
Though it has several benefits, being a full-time Airbnb host also comes with some challenges. The biggest ones include:
- You'll have to take on more responsibility. As the business owner, you are responsible for everything that happens, whether good or bad. This can be a lot of pressure, but it's also an excellent opportunity to learn and grow your skillset.
- You'll also be taking on more financial risk. Investing in real estate (including an Airbnb arbitrage) is usually considered a low-risk investment with greater earning potential than other “safer” options like investing in GICs. When you're running a business, there's always the potential for financial loss, so you must always have a backup plan.
- You could end up working long hours. If you quit your job to start an Airbnb business because your previous one required too much work, you might be in for an unpleasant surprise. Being a business owner usually implies longer hours, even more than you did in your previous day job. This can be tough if you have other commitments that are at least as important as your business.
- You have to be comfortable with people coming and going from your home. Not all people find it easy to welcome strangers into their property. If you're not comfortable with this, it might not be the right business for you.
- Problematic guests can be challenging. You may occasionally have difficult guests to deal with. You will have to deal with these situations professionally and courteously.
The Bottom Line
Turning your Airbnb side hustle into a full-time business is a great way to achieve your financial goals. However, it's not something that you can pull off overnight. It takes time, effort, and planning. However, by following the steps outlined above, you'll be well on your way to success.
But wait, there’s more!
I did tell you that marketing your Airbnb business is critical to operating it and earning revenue. This is why in Part 2 of our Airbnb series, I’ll show you how to market your business, from promoting it, to running it profitably, and even down to expanding it. Watch out for it next time!
About the Author
Jordan Bishop is a personal finance expert and travel hacker who holds a degree in finance and entrepreneurship from Wilfrid Laurier University, Waterloo, Canada. He is the founder of Yore Oyster and How I Travel, two sites to help you optimize your finances while living an international life. He recently published his first book, Unperfect, an exploration of problem-solving.