Airbnb Hosts, Are You Really Making Money?

You spend hours adjusting your photos, spying on others’ listings, checking your Airbnb app over and over again as if you have OCD… We all know hosting on Airbnb ain’t an easy job no more. Every single year the total listing number in Australia is soaring at a rate of over 20%. We, as the Airbnb hosts, are facing a competition pressure like never before. With the new ranking algorithm and smart pricing system, the Airbnb god has spoken:lower your nightly rate, and welcome more guests… I know this is not cool, but before you give them the finger which they can’t see anyway, let’s take a break and think about the true question: How much did you actually make from hosting Airbnb? Is it still worth investing in?

Do The Calculation

Nothing is better than a data-driven analysis, a.k.a, knowing the numbers. Airbnb provides an easy and quick income calculator. If you haven’t checked it, do it now.

Some data extracted for Australian hosts:

Sydney (1 guest): entire place $784/wk, private room: $466/wk

Melbourne (1 guest): entire place: $703/wk, private room: $408/wk

Sounds pretty weird? Especially for Sydney, as the average long term rental in Sydney is way more than Airbnb’s figure ($750+/wk for 1 bed).

Apparently, Airbnb’s data mixes all bedroom types together. So, to deliver a more accurate and detailed result, we made Hubo, the chatbot that tells you how much you can earn from renting your property on Airbnb. (Yes, it’s a cheeky plug-in, please click!)

We figured out that on average, the rate for an 1 bedroom entire place listing in Sydney CBD is $132, 2 bedroom is $193, 3 bedroom or more is $465. In Melbourne, 1 bedroom for $134, 2 bedroom for $199, 3 bedroom for $227.  To add some spice, we’ve also included data for renting car space on Parkhound. If you are interested, check it out.

The Revenue

Here we’ve made a few assumptions: First, all listing types are with a 70% occupancy rate. Second, a natural calendar year is 365 days. Third, no discount is given for longer term rental, and the average stay is 3 days.

Based on these assumptions,  the annual revenue is as below:

The Expenses

This is a common mistake. Many hosts are happy to see money flowing into their accounts, but just like any other rental forms, it comes with expenses. These include:

  1. Explicit costs: Airbnb service fee, fittings and furniture, strata management fees (for owners), cleaning fees + linen service fees (if applicable)
  2. Hidden costs: Long-term market rental opportunity cost, other opportunity costs, wear-and-tear

Among these, Airbnb service fee is unavoidable, furniture costs can be treated as a depreciable asset, and cleaning fees can be passed on to guests. Although in reality, many hosts are reluctant to pass on the full fees of cleaner hire to their guests, here we just assume that the fees are fully reimbursed. So the fomulation is:

Gross Profit = Total Revenue – Fixed Explicit Costs (eg. strata, utilities) – Hidden Costs

The result is as below:

As some data inputs are from inactive listings, the current Gross Profit may be a bit lower.

Worthy or Not?

Any money is good money. In a traditional investment logic, if you are still making a profit, even just by a little bit more, you should keep it going.  However, Airbnb requires more than just a home, it requires YOU, too. You have to commit your own time, so being a host is a good JOB, not an INVESTMENT unless you are hosting 100% hands-off. As for a job, we do need to talk about your hourly rate and see if Airbnb is a good ’employer’.

Hosting is time-consuming. According to Trish Clark, an experienced Melbourne host and also an Airbnb service manager, the average monthly time spent on hosting a single property is about 20 hours. The number can be many times bigger if there is any waiting time for guest check-ins, or for a high turnover one bedroom place.  Take your own time into account, let’s take another look at the profitability in the almost best-case scenario:

Poor Sydney hosts and those who are hosting one bedroom in Melbourne! Really? Airbnb, even Uber guarantees a $30/hr minimum pay! 

Really? Even Uber guarantees a $30/hr minimum pay! 

What You Can Do?

You can blame Airbnb, blame the greedy capitalism, or blame your fellow hosts who are offering their places cheaper than you…

Just chill, as you’ve just wasted another 10 seconds of your life. If Airbnb doesn’t help you, then help yourself as much as you can:

Get Someone To Help

Why do it yourself if you can get others to help? Get yourself a cleaning contractor who can also do linen changeovers for you. Or, you can get yourself a full Airbnb management concierge, who is able to look after you every step of the way, from listing setup, to communication, key exchange, and cleaning. In the best cases, you will be able to host completely hassle-free. However, the fee is usually 15-20% of your nightly rate, and there might be a risk that you work with someone who simply doesn’t care. So, if you want a referral to a responsible manager in your area, leave us a note by selecting ‘I Wanna Chat!’

Use Technology

Hosting like a pro. Hotels and real estate agencies use management tools to help to arrange their booking dates, and channels, so can you! For every single step of both online and offline hosting process, you can borrow tech powers to get things together. Get a Google calendar to synchronise your Airbnb booking dates, use Beyond Pricing to get the best rate, and buy a Bluetooth noise detector to prevent doggy guests from turning your place into a party house. Alternatively, you can consolidate all your online hosting tasks by getting a property management tool like Hostaways.

Yet the most broken hosting process is check-in and key exchange, which can take over 50% of your total hosting time because of guests’ flexible arrival time. If you are in a residential building where it’s not safe to use lockboxes or mailboxes, you can drop off your key at a nearby KeyHub kiosk. You are able to manage your key remotely from your phone, while your guests self pick up the key and get welcomed by local businesses.

Airbnb Is Not Your Only Option

We love hosting and meeting amazing people through Airbnb, but sometimes we just need to wear our investor’s hat. Expand your channel by listing on different platforms is the real deal during quiet seasons or when you are abandoned by Airbnb’s ranking for no reason. Stayz,, Tripadvisor are the most common options. There are some not so commonly known ones but can really help you: and, China’s Airbnb, which are dominating the Chinese market over Airbnb itself. Every year they bring millions of Chinese tourists to stay at short term rental homes overseas. They handle the communication with guests on your behalf, while English speaking account managers keep you updated on the booking details. Leave us a message if you are interested, we can help you.

So, my tips…

Don’t be tied up to your listing, you shouldn’t be the cheap labour of Airbnb! Get some help, leverage on host assisting technologies, and list your place on multiple platforms.

Comments 24

  1. The fill power is a crucial aspect of down comforters.
    This does not have any impact on the heat of the down comforter, however it does alter the
    feel and look of it. Delighted infants come from pleased moms and dads.

  2. The most popular quality of gold used in precious jewelry making is 14-karat
    gold, which is perfect for rings. For the next steps in this
    cleaning mission you will need a sponge, dry cleaning agent and a damp cloth.

  3. A minimum of this will not take place for lots of years.
    Convenience and price are the 2 essential aspects in picking a
    new mattress. All manufacturers are guilty of seemingly offering a
    complicated range of mattresses.

  4. One method to stop snoring naturally involves changing the position throughout
    sleep. Your specialist may suggest you switch to a particular type of neck pillow
    for sleeping. Gone are the days of baked on board cookies and actual meals.

  5. A minimum of 8 cups of water are required by the
    body every day, and it may require much more than that.
    The majority of bathrooms nowadays are relatively small.
    Possibly its you tidying up after your households
    untidiness and spills.

  6. Hi there,I check your blogs named “Airbnb Hosts, Are You Really Making Money?” on a regular basis.Your humoristic style is witty, keep doing what you’re doing! And you can look our website about تحميل مهرجانات.

  7. Great beat ! I wish to apprentice while you amend your website, how could i subscribe for a blog website? The account aided me a acceptable deal. I had been tiny bit acquainted of this your broadcast provided bright clear idea

  8. Good – I should certainly pronounce, impressed with your site. I had no trouble navigating through all tabs and related information ended up being truly simple to do to access. I recently found what I hoped for before you know it in the least. Reasonably unusual. Is likely to appreciate it for those who add forums or something, site theme . a tones way for your customer to communicate. Nice task..

  9. Very good written story. It will be beneficial to everyone who employess it, including myself. Keep doing what you are doing – i will definitely read more posts.

  10. Hello! I’m at work browsing your blog from my new apple iphone! Just wanted to say I love reading through your blog and look forward to all your posts! Keep up the great work!

  11. I’m not sure where you’re getting your info, but good topic. I needs to spend some time learning much more or understanding more. Thanks for fantastic info I was looking for this info for my mission.

  12. I simply want to tell you that I am all new to weblog and actually loved your website. Probably I’m likely to bookmark your website . You definitely have exceptional articles. Cheers for revealing your web-site.

  13. Does your website have a contact page? I’m having trouble locating it but, I’d like to send you an e-mail. I’ve got some recommendations for your blog you might be interested in hearing. Either way, great blog and I look forward to seeing it grow over time.

  14. There’s fantastic changes on the layout of the blog, I certainly love this. My site is dealing with apps and generally there are lots of things to be done, I am yet still a newbie in web page design. Thanks!

  15. Hi! Do you know if they make any plugins to safeguard against hackers? I’m kinda paranoid about losing everything I’ve worked hard on. Any recommendations?

  16. this isn’t just any ordinary twerking clip.|From Miley Cyrus’s titillating 2013 overall performance to on the web tutorials, twerk videos have exploded in recognition over the final few years.|Mixtapes from DJ Godfather and artists like DJ Snake , Lil Jon , T-discomfort ,

  17. “Wonderful work! This is the kind of information that are meant to be shared around the internet. Disgrace on Google for now not positioning this put up higher! Come on over and seek advice from my website . Thank you =)”

Leave a Reply

Your email address will not be published.