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How To Start An Airbnb

Updated: Jun 21

Short -term rentals has grown like crazy over the last decade. More and more people are choosing Airbnb for their vacation property rental accommodations, and many real estate investors are taking advantage of this trend. However, real estate investors who want to start an Airbnb need to take the right steps if they want to make money.

How to start an Airbnb

Owning an Airbnb is a business venture that can be very lucrative, but it requires knowledge of listing properties and the ability to host multiple tenants over the course of a year. To start an Airbnb, you'll want to use this step-by-step guide that explains everything you need to know to make sure your Airbnb runs smoothly and stays occupied.

6 Easy Steps To Start an Airbnb

Airbnb's can change your life, help to pay off credit cards or buy a new car or a home.

You can leverage your investment property to buy other investments with it. It can be rough at first, but with these easy steps it can be very profitable. Here are the steps to start and Airbnb:

Step 1: Check Your City and HOA Laws

Airbnb has rules, and you should know what they are and the consequences of breaking them before you decide to use this company to list your short-term rentals.

To find the local laws regarding short-term rentals, call your city's planning or zoning departments. There are three questions you need to ask your city planner:

1.Are there any rules specific to short-term renting, Airbnb, or VRBO?

2. Are there any rules restricting rentals that last 30 days or less?

3. Are short -term rentals recognized in the city use code? And if not, are uses not addressed in the use code considered illegal?

Asking these three questions should tell you what you need to know about the legality of short- term renting in your city.

HOA? You'll want to check the declarations or email your HOA board to ask if there are rules limiting rentals lasting 30 days or less.

Step 2: Declutter Your Space

You don't need to have a designer's eye to build a good Airbnb space - although it certainly help. Just think "less is more". Experts say to keep your furnishings to a minimum.

Make sure your place is tidy, fold blankets, tuck chairs under the table, organize magazines and books and remove all dishes from the sink. Remember, tidier is better.

Hire a Photographer

Step 3: Hire a Photographer

Here’s something to remember: Potential guests are looking at tons of listings and making snap judgments based on a quick glance. What draws them in? Photographs. And if yours are dark or not framed correctly, you may be missing out on potential renters. Unless you have some expertise in photography, your iPhone’s not going to cut it.

Do one of two things:

  1. Take advantage of Airbnb’s free photography.

  2. Hire your own photographer.

Many listings qualify for Airbnb’s free photography. Unfortunately, some listings don’t, or the wait may be too long. In that case, I urge you to hire a professional real estate photographer. It can cost anywhere from $110 to $300 depending on the photographer’s experience, but you’ll make that up in no time when you’re renting out your unit.

Step 4: List Your Space

When listing your space, think inside and out. What is most appealing about the inside of your space? What is most appealing about the outside or location of the property? When you have your answers, fold them into one headline. And when doing this, try to sell the experience, not just the amenities. Consider these examples:

Live the Local’s Life – One Bedroom Within Walking Distance of Downtown

See the City: Urban Loft With Floor-to-Ceiling Windows

The listing is also a great place to discuss other important items, such as whether animals are allowed, if there’s laundry and how much, if anything, it costs, and similar details that can help guests understand what your place offers. Remember this listing is public, so include the basics here, but not the details. Leave off the Wi-Fi password, information about the neighbors, and other facts that you can provide the renter when they decide to stay.

It’s vital to be transparent and honest about your space. People will forgive a leaky faucet or a not-quite-as-bright basement apartment if you’re upfront with them. Set accurate expectations, and you’ll prevent a lot of problems in the future.

Step 5: Set Your Price

Okay, you’ve decluttered your place, taken good photos, and set up your listing. Now, how much do you charge for your nightly rate?

You’ve got a couple of tools to figure this out.

  1. Airbnb Smart Pricing: Airbnb offers a tool that sets the price for you. This is great for those who don’t want to think too much. The problem is that they’re using averages, and if your home is above average (and 50% of them will be), then Airbnb is pricing your short-term rental too low. I’ve heard people get upset that somehow Airbnb allowed their two-bedroom condo to get booked for $70/night for New Year’s Eve.

  2. Outside pricing tools: There’s a cottage industry of dynamic pricing tools tailored to short-term rentals. These have the same benefits as Airbnb’s Smart Pricing and drawbacks. They provide ease of use but are not that precise.

  3. Do your own research: The third option – and our personal favorite – is doing some good old-fashioned market research. Act like you’re a guest and search for properties of similar size with similar furnishings in your immediate area. Be sure to check their reviews to see if they have any recent ones, which will indicate they’re getting booked.

One mistake people make when researching what to price their unit at is they rely on a host’s calendar to gauge occupancy. A host can block off dates for any number of reasons. They may be booked for the entire month of November, or they may have just blocked it off for their own use.

Now that you know what comparable properties rent for, you’re set! Well, almost set. First, you should cut 10% to 20% off that price. Why would you do that? Because positive reviews are one of the best ways to move up in Airbnb’s search rankings.

If you’re priced at the same rate as similar properties with lots of reviews, guests are going to choose the listing with more reviews. You need to undercut your competition for a while, grab a couple of stellar reviews, and then you can slowly raise your price.

Step 6: Be Nice

I can’t emphasize this enough. Be enthusiastic and nice in your messages, in your face-to-face interactions, and in any phone calls or texts you make to your guests.

This is both an offensive and a defensive tactic. It’s offensive because your kindness may spill into the good review they’ll leave. That’s a good thing! It’s defensive because I’ve found that even if a guest has a bad time at your place, however, they like you and think you’ve tried hard, they are less likely to leave a bad review. I’ve hosted tons of people who I know had something go wrong during their stay, and they either didn’t leave a review or left a review that simply said the host was super attentive and nice.

How Much Does It Cost To Start an Airbnb?

The cost to start an Airbnb business will vary depending on many factors. If you don’t already own a property, you’ll have to include the purchase of a home as part of the cost to start an Airbnb. Those who already own a unit that can become a short-term rental won’t have as many upfront costs, but there are still many things to budget for before becoming an Airbnb host.

Getting a unit ready to rent short-term typically costs investors between $5,000 and $7,000. However, everyone’s costs will be different. Here are some of the things you’ll need to budget for when you want to become an Airbnb business owner:


If you’re going to own a vacation rental property, you need to have the right insurance. The best way to understand how much coverage you’ll need to protect yourself and your Airbnb property is to talk to an insurance agent. Keep in mind that the more guests your property can accommodate, the more you’re likely to pay in insurance premiums.


An Airbnb listing should look good in photos, which requires it to have just the right touch of furnishings. Some hosts may get away with purchasing a few items from a thrift store, while others have to buy all new pieces. It often costs a few thousand dollars to properly furnish a short-term rental unit.


Beds and couches are great, but one reason people book on Airbnb is that they want all the extras that come with it. This means you need to have pots and pans in the kitchen and many of the basic amenities people might need when they’re staying in your property. This shouldn’t cost more than a couple hundred dollars, as these items don’t need to be top-quality, although you do want to choose durable stuff.

Consumable goods

Consumable goods are those that get used up during a guest’s stay, such as toilet paper and paper towels. Additionally, you need to think about the cleaning products your property manager uses and include their cost in your budget. While you can roll this cost over into the cleaning fee, you’ll still have to pay for these items from your budget. These things aren’t expensive, and you should be able to cover it for less than $100.

Utilities and subscription services

In a long-term rental unit, the tenant pays the utility bills and they’re responsible for their own services, such as the internet. When you get into the short-term rental business, this isn’t the case. As a host, you’ll have to pay the power bill, and you’ll also want to pay for internet service, as many people won’t rent a unit that doesn’t offer Wi-Fi. Utility bills can fluctuate depending on the season and the number of people in the home.

Check with the power company and other utility providers to get an estimate of what you can expect these bills to run each month. You may also want to provide subscriptions to streaming services to help entertain your guests, especially families with young children and business travelers. These fees are set by the service providers and can change, but you can find streaming services for $20 per month or less.

How Much Do Airbnb Owners Make?

Airbnb owners in the United States are the top earners on the platform, making on average around $41,000 per year. However, in Hawaii, that average hits in the $70,000 range. Of course, the more property you rent through Airbnb, the more cash flow potential you have.

How much you make from your rental unit also depends on its location and occupancy rate, so be sure to do some research if you’re looking to buy a short-term rental investment property. You want a place that attracts visitors for as much of the year as possible, with year-round tourism being ideal.

Can You Start an Airbnb Without Owning Property?

Although it will be much easier to become an Airbnb business owner if you have a property that works well as a vacation rental already in your possession, there are a couple of ways you might enter the short-term real estate market without having your own property. Here’s what they are:

  • Become a property manager for an investor who has a few rental units. You can use this to learn how to start an Airbnb and what having a vacation rental property will entail so you know what to expect.

  • Get a long-term lease for a property that you can then rent out for a higher nightly rate than what you pay. You may have to clear this with the property owner, but it can be a way to earn some money to put toward buying your own property in the future.

  • Rent an extra room in your home. You can clean out unused space in your house and rent it on Airbnb. Use this as a stepping-off point to learn how vacation rentals work.

Is Starting an Airbnb Worth It?

Both long-term and short-term rentals have their benefits, but many people wonder if starting an Airbnb is worth it. We’re here to tell you that it can be extremely profitable to invest in short-term rentals. However, this wealth-building strategy isn’t for everyone. If you prefer the steady income that comes from renting to the same person or family for at least a year or more, then stick with the long-term rental market.

Starting an Airbnb can be a full-time job, and it takes a lot of effort to build the business. But when you have a few units under your belt and a thorough property manager who can oversee the cleaning and restocking of the rental property, you can set yourself up to make a nice passive cash flow that doesn’t require much effort on your part.

As we said before, becoming a rockstar Airbnb host takes time, and there are certainly more advanced tips to follow when operating a short-term rental. Don’t let that stop you. Take the steps we talked about and give it a go.



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