How Do I Analyze a property as a potential Air bnb?

[Stephanie Cessna]

Help! There is a house on the MLS that I would like to analyze as an Airbnb. It states that it has already been a profitable Air bnb for the past year and the price seems good, but I am unfamiliar on how to analyze a property for an airbnb. Are airbnb's worth it? Would it be better for me to analyze it as a rental? Any tips on where to start?

[Sofia Sharkey]

@Stephanie Cessna

Three month projection analysis:

1. Open the Airbnb app and choose filter by the criteria of your potencial property (I.e 2 bed 2 bath in downtown)

2. Choose a listing, write all the week prices - add them up and divide by the number of days you wrote (I typically do this for 3 months as prices are likely not optimized after that)

2. So the same thing with weekend prices, write them all out and divide by the number of days

3. How many days of the month is it occupied? 60% or 70% - you can see based on the blocked vs open days.

4. Take your numbers above times that occupancy %.

5. Repeat with 6 other listings

This will give you a spot on gross revenue and average daily rate numbers and for your area for the season. This not accurate for the rest of the year but if the next three months are NOT peak season and the numbers look good, then the deal makes sense in my opinion. Airdna has not been accurate in my experience so I do my own analysis for Airbnb and sometimes VRBO.

6. I also call property management companies in the area and ask how much would a property with x criteria make, companies like evolve (in vacation rental markets) offer pretty accurate data as well. This way you can confirm your numbers

Good luck and if the above doesn’t make sense, I’m happy to show you a screen shot where it’s easier to see!