As you get ready to become an Airbnb host, you probably have a lot of questions about what to expect.
How can you make your Airbnb as profitable as possible?
What are the hardest aspects of hosting?
What does it take to run a successful Airbnb?
To help you prepare to start your own insanely profitable Airbnb, I’m sharing nine surprising lessons learned in my first nine months as an Airbnb host.
Before you start your first Airbnb, be sure to read the below guide. It’s jammed-packed with valuable experiences that will help you succeed as a first-time Airbnb host.
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- 9 Surprising Lessons Learned in My First 9 Months as an Airbnb Host
- 1. Determining Your Pricing Is Super Hard
- 2. Your Revenue Fluctuates a Ton
- 3. A Flexible Cancellation Policy Can Be Bad for Business
- 4. Many Guests Won’t Pay Extra Charges
- 5. Proactive Property Maintenance Is Crucial
- 6. You’re Now a 24/7 Customer Service Representative
- 7. A Perfect 5-Star Rating Isn’t Everything
- 8. It’s Important to Regularly Update Your Listing
- 9. To Maximize Profit, You Need to Plan Ahead
9 Surprising Lessons Learned in My First 9 Months as an Airbnb Host
1. Determining Your Pricing Is Super Hard
The first month I opened my Airbnb, I made nearly $19,000 in gross revenue. The #1 reason I was able to generate so much revenue was that I opened my Airbnb right before high season. (This is one of my 6 proven tactics to maximize your Airbnb revenue.)
At the time, I was manually calculating my Airbnb pricing. But once I got the hang of things, I found manually calculating my pricing to be waaaay too time-consuming.
So, I started using an automated pricing tool, which saves you tons of time by automatically updating your pricing on Airbnb.
In fact, I tried out two different automated pricing tools during my first nine months of hosting.
Unfortunately, each tool turned out to be a total disaster.
What I learned was that, when it comes to determining your Airbnb pricing, you never have complete information. You always feel like your price is too low or too high. It’s very hard to find the sweet spot.
One thing that’s helped me a ton was creating my own hybrid pricing strategy. I no longer use an automated pricing tool. Instead, I use AirDNA’s forecasting tool and manually update my pricing, so that I stay in full control.
Learn exactly how AirDNA can optimize your Airbnb pricing.
2. Your Revenue Fluctuates a Ton
Starting an Airbnb is not for someone who requires a steady, consistent stream of income.
Your revenue will likely swing drastically from one month to the next.
How much your revenue swings depends not only on factors you control but also on external factors you have no control over.
When it comes to what you can control, setting the right nightly rate is one of the most important factors. Your pricing alone will determine whether you get any bookings at all.
Other factors such as your listing photos, description, and reviews make a huge difference, too. Get all my tips for creating a listing that converts in this post.
After such a successful first month, my second month hosting was also a huge success, bringing in over $8,000 in gross revenue.
But then, something happened that I had no control over. Wildfires near my Airbnb caused an unhealthy amount of smoke and evacuations nearby.
For two whole months, I got zero bookings. $0 in revenue. No one was willing to travel to the area.
As an Airbnb host, you have to be able to survive low months like these.
One thing that can help is planning ahead. AirDNA’s forecasting tool helps you do just that by projecting your expected revenue every single month.
3. A Flexible Cancellation Policy Can Be Bad for Business
In addition to everything covered above, another huge factor that impacts your income is which cancellation policy you choose.
And, you’ll notice right away that Airbnb really wants you to have a flexible cancellation policy.
When I first opened my Airbnb, I had a strict cancellation policy. Since those months were so successful, I was skeptical that a flexible cancellation policy would be good for my business.
But, when I hit my first dry spell during off-season (aka fire season in Lake Tahoe), I decided to give it a shot.
What a mistake.
My cancellation rate jumped up to 50%!
Can you imagine HALF of every booking you get getting canceled?
All those cancellations were very stressful and made my revenue stream even more unpredictable.
In the most extreme instance, one guest booked my Airbnb over Christmas four months in advance. That guest then canceled two weeks before check-in.
This guest booked one of my most profitable nights, restricted any other guests from booking for four months, and then canceled just before check-in and was fully reimbursed.
Get everything you need to know about my experience with Airbnb’s flexible cancellation policy here (and learn which policy I now use!)
4. Many Guests Won’t Pay Extra Charges
As a new Airbnb host, it’s crucial that you know how to use the Airbnb Resolution Center (how hosts get paid when they need to charge guests extra fees after booking.)
But what’s even more important than knowing how to use the Resolution Center is knowing when to use it.
That’s because what I’ve learned first-hand is that whether or not guests pay for extra expenses is hit or miss.
In the last nine months, I’ve requested eight payments from guests. Three were for damage or extra cleaning fees, six were for other services (like private beach access, lost parking passes, or adding more nights to a booking.)
About half of those were paid by guests. The rest were actually paid out to me by Airbnb (through their insurance policy, AirCover) after the guest chose not to pay.
And, while I’m really appreciative that Airbnb has covered the cost when guests haven’t paid, I’ve learned that hosts need to be very careful when deciding when to charge guests.
That’s simply because guests don’t like to be charged extra fees.
And, charging an extra fee often isn’t worth the risk of ending their vacation on a bad note (potentially leading to a negative review.)
In general (but not always) guests WILL pay for extra services they request.
In general (but not always) guests WILL NOT pay for extra cleaning costs or damage done, even if the potential for these costs are clearly stated in your house rules.
So, I came up with a solution to avoid unnecessarily charging extra fees.
5. Proactive Property Maintenance Is Crucial
After 6 months of Airbnb hosting, I decided to visit my property (I manage it remotely and live pretty far away, so I hadn’t been back since I opened it.)
As soon as I walked in, I was SHOCKED at how much work needed to be done.
At that point, I already had a laundry list of things to be fixed that guests had told me about (BTW most guests are super thoughtful and will privately tell you about small things they recommend fixing rather than leave it in a public review.)
What I didn’t realize was that my laundry list would quickly double in size as soon as I walked around the property myself.
I was shocked at how many issues I found that guests hadn’t told me about.
Fixing these issues before they become a big enough problem that guests leave a negative review will help your business succeed.
That’s one reason why it’s absolutely essential you plan regular visits to your Airbnb property. You should visit at least every six months (more often, if possible!)
When you’re planning your own property maintenance check, be sure to check out my thorough step-by-step guide (bookmark it for later.)
Also, make sure you’re not making any of these 10 property maintenance mistakes.
6. You’re Now a 24/7 Customer Service Representative
In my first month of hosting, I immediately learned one important lesson: customer service is a huge part of your role as an Airbnb host.
You need to be available 24/7 for your guests.
That’s because something could go wrong that you need to address right away.
For example, one of my recent guests got locked out at 3 am. If my cell phone hadn’t been loud enough to wake me up, I would have had no idea our keyless entry wasn’t working. My guests – who were arriving after a long travel day – would have been locked out in the middle of winter.
And, responding promptly matters to guests. They want to feel like you’re taking care of them. They want to know that if something goes wrong, you’ll be there to help right away.
Communication is so important that over half of my reviews mention how much my guests have appreciated my communication and quick responses.
Since guest communication is so crucial, I wrote an entire blog post about common Airbnb messaging mistakes and how to avoid them.
While we’re on the subject of customer service – you should know that you’ll get a wide variety of guests.
Many guests will be wonderful, some will be awful, and most will be neutral. Check out this post to learn how to successfully communicate with the wide variety of guests you’ll get.
7. A Perfect 5-Star Rating Isn’t Everything
Not long after starting your first Airbnb, you might find yourself stressed about your reviews and overall star rating.
(After all, you’ve poured tons of time, energy, and money into creating a perfect Airbnb. The thought of getting a less-than-perfect review can be heartbreaking!)
And, you’re right to worry.
Reviews are very important to guests. The better your reviews, the more bookings you’re likely to get.
But, getting a perfect 5-star overall rating isn’t everything (nor is it realistic; and telling yourself it is might just result in you hating hosting).
The good news is, that there are tons of ways to get MORE positive reviews.
And, you can actually make negative reviews benefit your business. Here’s how.
8. It’s Important to Regularly Update Your Listing
As you plan to start your first Airbnb, creating your listing is undoubtedly something you know you’ll need to do.
And, you might find that creating your listing is actually one of the easiest things about setting up your first Airbnb.
But don’t overlook the importance of regularly updating your listing once it’s live!
You’ll want to make sure your listing is optimized given the time of year and latest Airbnb data (don’t worry, I’ve compiled 100 helpful Airbnb stats for you to use here.)
You’ll also be learning a lot as a new host, so you’ll want to regularly update your listing based on your experiences with guests.
For example, if a guest breaks a house rule, it’s a good idea to reread your house rules and see if there’s anything you can clarify.
Or, if you get a lot of the same questions from different guests, review your listing to see if you can make the answers to those questions clearer. That way, guests get the information they’re looking for right away, without having to message you.
And, make sure you’re not making any of these 10 common mistakes with your Airbnb listing.
9. To Maximize Profit, You Need to Plan Ahead
The best way to maximize your profit is to really nail your Airbnb pricing.
But, did you know there are a bunch of other, lesser-known, tactics that will help you increase your income as an Airbnb host?
Learn exactly how AirDNA can optimize your Airbnb pricing.
That’s it! All nine lessons learned from my first nine months of Airbnb hosting.
When you start your first Airbnb, there’s no doubt that you’ll learn A TON!
No matter how much you prepare, mishaps are sure to happen.
I hope this post helps you prepare as much as possible so your business is a success right away.
Just know, there will always be more to learn!
Embrace it. It’s all part of the journey.
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