Over the past few years Airbnb renting has emerged as a popular alternative to hotels for travelers who want the space and comfort that a home can provide. That’s opened the door for investors looking to cash in on the growing market for short-term rentals.
Key Profit Factors for Airbnb Renting
As with all things real estate, it’s location, location, location. Some American cities are able to generate hefty profits for those who list on the site. In other places the quest for rental income has proven a little more elusive. A number of factors account for those disparities.
If the city has a relatively small supply of hotel rooms, for example, that tends to drive up Airbnb prices. But where hotels are plentiful and affordable, investors have little choice but to keep their rates low. The cost of housing is another big part of the equation. Places where investors can rent or buy for relatively little—but see a steady demand from tourists—represent the real sweet spot.