If you’re even remotely considering starting an Airbnb, one of the very first questions you need to ask yourself is: How much does an Airbnb host actually make? This blog post will give you the tools you need to understand just that.
Read on to find out exactly how much I earned my first year Airbnb hosting and how to estimate your own potential earnings.
This post may contain affiliate links. If you click a link and make a purchase, I may earn a commission at no additional cost to you. As an Amazon Associate, I earn from qualifying purchases. I’m not affiliated with Airbnb in any way (other than being an Airbnb host, of course). Read my full disclosure policy here.
How Much Does an Airbnb Host Make?
As an Airbnb host, the amount of revenue you earn is determined by your nightly rate (how much you charge per night) and your occupancy rate (how many nights get booked).
Your nightly rate and occupancy rate are impacted by several factors. The location of your property is probably the biggest and most important factor. That’s because your location is what drives guests to your area. It’s part of what determines when they stay, how long they stay, and how much they’re willing to pay.
The best way to understand the revenue potential of a specific location is by using AirDNA’s FREE revenue forecasting tool. Simply create a free account, then tap “rentalizer” on the lower left-hand menu, and enter any address or location to instantly get a free revenue estimate.
Other important factors include how many nights out of the year your property is available, the quality of your property, how many people it comfortably sleeps, and your reviews/ratings.
As an example, my Airbnb is located in Lake Tahoe, which is a heavily-touristed mountain/lake town with two busy seasons: summer and winter. It’s a 3 bedroom, 2.5 bathroom condo that comfortably sleeps six guests. It’s newly renovated and I use it solely to Airbnb, so guests can rent it out 365 days a year. This is all designed to maximize my profit, and over the past year, doing so has certainly paid off.
See exactly how much I earned my first year hosting in my free income report:
Does Airbnb Income Fluctuate?
When it comes to your Airbnb revenue, you need to know that it most likely won’t be a smooth, steady stream of income. This is especially true if your Airbnb is in a heavily-touristed area with changing seasons. Most guests will likely travel there for certain seasons but not others, like summer and winter but not spring and fall.
My Airbnb in Lake Tahoe generated nearly $19,000 in revenue my very first month hosting because that month was the height of busy season in the area. Other months can have so few travelers that I sometimes earn $0.
The good news is, you can get instant access to seasonality data for your area with AirDNA’s monthly subscription. It’s low-cost (as low as $11.99), you can cancel anytime, and it gives you access to seasonality insights and tons of other data that’ll help you buy your Airbnb with confidence.
Pro tip: One of the best things you can do to increase your revenue is optimize your listing.
What Expenses Do Airbnb Hosts Have?
One thing that might surprise you is that your “host payout” (what Airbnb pays you) isn’t your entire revenue. Before paying its hosts, Airbnb automatically subtracts a couple of expenses.
Second, Airbnb also collects occupancy taxes from the guest and then remits those taxes on your behalf.
The amount remaining is what Airbnb calls your “host payout”, which gets paid to you 24 hours after the scheduled check-in for each booking.
That said, host fees and occupancy taxes are just a couple of expenses you’ll have as an Airbnb host.
In addition to your nightly rate, you’ll charge guests a cleaning fee. Airbnb will pass this cleaning fee directly on to you, which you’ll then pay directly to your cleaning crew. For guidance on how to set your cleaning fee read this blog post.
On top of all that, you’ll have many other expenses required to run an Airbnb, especially during your first year. Get my complete guide on estimating your Airbnb startup costs here.
Pro Tip: See how much I paid for every single one of these expenses by downloading my free income report.
Downloading my free income report is an absolutely essential first step in determining how much you could make as an Airbnb host.
In my income report, you’ll get it ALL: real month-by-month revenue, nightly rates, and occupancy rates; every single expense from my first year hosting; and what I actually took home as income.
Pro Tip: Download my free income report to get full breakdown of my revenue, expenses, and profit as a first-time Airbnb host.
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What questions do you have about how much Airbnb hosts make? Let me know in the comments.
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