A while ago, I wrote an article on how everyday Britons are using Airbnb to pay off their mortgages. And rather than just write about it, I decided to practice what I preach. I decided to rent out my 2 bed flat in Manchester city centre one weekend a month over the last year.
Below are my findings from my experience using Airbnb. As you will see, it is simple and easy for anyone to make money from renting out there home using Airbnb.
How hard is it to list on Airbnb?
Listing your property on Airbnb is a straightforward process and can be done easily.
- Property Details – There are a number of details you need to fill out about the place you are listing such as the home type (apartment/house), room type (entire home / private room/ shared room), how many people it accommodates and the location.
- Overview – You also need to give an overview of your apartment. This is where you give a description about the property and by being clever, you can make your place really stand out.
- Pictures – After the overview, you need to put up pictures of your place. Taking the right picture is crucial but it can also be time consuming. Make sure your place is clean and tidy and the lighting is right before taking any pictures.
- Amenities – This section allows you to tick which amenities you have from the list provided. Have a look at this post from Gusty to see the essentials that every host should include in order to maximize their Airbnb experience.
What was my occupancy rate with Airbnb?
I decided to rent my apartment out only on weekends when I could go and stay back at my parents or go to meet my friends across the country. Over the past year, I placed an ad for my place 12 times as I only wanted to rent my place out one weekend a month.
The good news for me was that every time I put an ad out, there were numerous people wanting to stay at mine. Just seeing the number of interested people made me realise that Airbnb is bigger than I imagined and more and more people are shunning traditional hotels.
Most of the times I would advertise availability of my flat 3-4 weeks in advance and I would normally have rented it out with a week of advertisement. My flat is in the city centre so that helps a lot!
How much work did I have to do?
There is really not much work to do as a host.
Answering enquiries is easy – I reply to emails through my phone. It’s about as much of a hassle as checking Facebook or posting on Instagram.
Meeting guests -As I work close to wear I live, I was flexible on when someone could pick up the keys for my apartment. Most people would get the keys around 5pm which was perfect for me. I usually have a chat with them for 5 -10 mins and answer any questions they may have. On Sunday, check-out time is 2pm. If I am not around, my neighbour is happy to collect the keys from the guests as he is usually in.
Cleaning – Due to having the privilege of being able to select my guests and only picking those that have the best reviews, I am glad to say that I have not been involved in any horror stories as of yet. The guests that have stayed at my place have left my flat clean and tidy. I have even had one or two occasions where the guests decided to hoover the apartment before leaving!
The biggest hassle is probably changing the bedsheets on a Friday morning and then changing them back on the Sunday (and of course washing them too!)
Are there any fees for hosts to list there property on Airbnb?
No, there are no fees for listing on Airbnb.
How do I select people whom to rent my property out too?
The first thing I look for is whether or not they are verified. I next go and see there ratings and read what other hosts have written about them. It is integral to research your guests as you don’t want to be walking back to an apartment that looks like a war zone!
How much money did I make on Airbnb?
Initially, I was making £140 for the whole weekend. Doing research and seeing that this was on the low-end of the pricing scale in Manchester city centre, I decided to experiment with my pricing structure. Making £180 for the weekend seemed to be the sweetspot.
In total, letting my place out for 12 weekends or 24 nights, I made a cool £2,100. This is not bad for the minimal work I have to do to list and clean the place.
Taxes – Do you need to Pay Tax when you rent out your home via Airbnb?
It is important to remember that Airbnb is not tax free! You do not come under the rent-a-room scheme as you are not renting your room full time.
So you will need to pay taxes on the amount you earn based on your marginal rate of tax. Read more on ‘rates of tax’ here. If you are a basic rate tax payer, you will need to pay 20% of the profits you make from renting your place. So this will be the revenue you receive less any allowable deductions like cleaning and laundry costs.
I made £2,100 so as a basic rate tax payer, I have had to pay the following on my self assessment return:
£2,100 * 20% = £420.
Thus, my profit from letting out the apartment is £1680. This is still a decent amount and have used it to pay down my mortgage.
The great news from April 2017 is that the government has introduced £1,000 tax breaks for property related income. This means that starting from 6 April 2017, i won’t have to pay tax on the first £1,000 I make from Airbnb. This is a cool £200 tax saving!
As the new £1,000 tax break applies to all property related income, you don’t necessarily have to rent you replace out on Airbnb to benefit from it. Have a look at my article on three ways to make money from your property.
How much time did I spend on average?
In total, I must have spent about 90 minutes every time I let out a property. This includes any adjustments to the online listing (dates), answering enquiries, meeting the guests and handing over the keys (5-10 minutes) and cleaning the apartment.
Time: 90 minutes
Extra Income after tax : £140
Hourly Rate: £93
Not bad, if I say so myself.
Did they keep my apartment clean? What was the quality of the Guests?
Surprisingly yes. As mentioned above, I checked reviews on people before accepting them to stay at place so I although I was not expecting to have a messy apartment when I got back, the apartment was cleaner than I would have expected. In some cases, it was almost as though no one had been in my apartment from the time I left to the time I got back.
So all in one, Airbnb has so far worked out good for me. It has given me an extra source of income for doing minimal work and is helping me pay off my mortgage.