Renting your home on Airbnb can be a great way to earn extra income, but it's important to be aware of the hidden costs involved. In addition to the Airbnb service fee, there are a number of other expenses that you need to factor in, such as:
Cleaning costs
One of the biggest hidden costs of renting your home on Airbnb is cleaning costs. You'll need to either clean the property yourself or hire a professional cleaner after each guest. If you hire a professional cleaner, expect to pay $100-$200 per clean.
Utilities
Renting out your home on Airbnb will also increase your utility costs. Guests are likely to use more water, electricity, and gas than you would typically use. You'll need to factor this increased usage into your pricing.
Maintenance and repairs
With more people using your home, there's a greater chance of things breaking or getting damaged. You'll need to be prepared to make repairs on a regular basis. This could include things like fixing leaky faucets, replacing broken light bulbs, and patching holes in the walls.
Insurance
It's important to have adequate insurance coverage for your rental property. Airbnb offers some basic liability protection, but it's not enough to cover all potential risks. You may want to purchase additional insurance, such as landlord insurance or short-term rental insurance.
Taxes
You'll need to pay taxes on the income you earn from renting your home on Airbnb. You'll also need to pay state and local income taxes on your Airbnb earnings.
Other costs
There are a number of other miscellaneous costs that you may need to factor in, such as:
- Key replacement if you lose a key or a guest loses a key
- Towel and linen rental if you don't want to provide your own towels and linens
- Amenities such as toiletries, snacks, and drinks
- Marketing costs such as professional photography or paid advertising
It's important to factor in all of these hidden costs when setting your Airbnb pricing. If you don't, you may end up losing money on your rental property.
Here are some tips for reducing the hidden costs of renting your home on Airbnb:
- Clean the property yourself. This is the easiest way to save money on cleaning costs.
- Invest in energy-efficient appliances and light bulbs. This will help to reduce your utility bills.
- Be proactive with maintenance and repairs. Make small repairs as needed to avoid larger problems down the road.
- Purchase adequate insurance coverage. This will protect you financially in the event of damage to your property or a liability claim.
- Track your expenses carefully. This will help you to identify areas where you can save money.
By following these tips, you can minimize the hidden costs of renting your home on Airbnb and maximize your profits.
Have you considered these hidden costs? What did you do to remedy them?
FAQs
One of the biggest hidden costs of renting your home on Airbnb is cleaning costs. You'll need to either clean the property yourself or hire a professional cleaner after each guest. If you hire a professional cleaner, expect to pay $100-$200 per clean.
What are the hidden costs of running an Airbnb? ›
One of the biggest hidden costs of renting your home on Airbnb is cleaning costs. You'll need to either clean the property yourself or hire a professional cleaner after each guest. If you hire a professional cleaner, expect to pay $100-$200 per clean.
Is renting your house on Airbnb worth it? ›
1. Higher Potential Returns. Airbnb rentals often have the potential for higher short-term rental income compared to traditional long-term leases. The flexibility to adjust pricing based on demand allows hosts to capitalize on peak seasons and events.
How do I avoid hidden fees on Airbnb? ›
How Do You Avoid Airbnb Fees?
- book direct.
- use another booking platform.
- stay at a hotel.
Host service fee
It's generally around 3% to 16%, depending on various factors. Host service fees include services like customer support and secure payment processing. Airbnb service fees are further subdivided into two: Split-fee: This is the most common fee structure.
Are there any hidden charges in Airbnb? ›
While Airbnb is generally transparent about its pricing, there are some considerations to be aware of to avoid unexpected charges: Service Fees: Airbnb charges guests a service fee, typically around 5-15% of the reservation subtotal. This fee is added to the total cost of the booking and covers the use of the platform.
What are the two huge complaints Airbnb is addressing? ›
This story has been updated. One of Airbnb's most-derided features — fees that can cause rental prices on the platform to balloon from the figures initially shown in search results — will be hidden no more.
What is the 90 day rule on Airbnb? ›
Airbnb doesn't allow properties to be rented out for more than 90 nights per year. If your limit for bookings is reached, Airbnb will automatically close your property until the end of the calendar year. In addition to 90 consecutive days, the 90-day limit also applies to 90 days spread throughout the year.
What is the downside of hosting an Airbnb? ›
You'll have to communicate with guests, quickly respond to their inquiries, immediately address problems when they arise and keep your place clean. In rare cases, you might need to deal with unpleasant guests or face Airbnb complaints. It takes a lot of work and can be physically and emotionally draining.
How much does Airbnb take from hosts? ›
Split fees
The host pays a flat rate of 3% of the total booking cost and the guest pays a percentage of their reservation fee (this is somewhere between 5-20% depending on the length of stay, the location, and the cost of the reservation to start with).
Vrbo is commonly considered the biggest Airbnb competitor. It has over 2 million listings and vacation rentals in 190 countries. And because Vrbo is part of the parent brand Expedia Group, listing on Vrbo enables you to tap into this brand's 112+ million monthly unique visitors.
Why are taxes so high on Airbnb? ›
In some locations, Airbnb has made agreements with government officials to collect and remit certain local taxes on behalf of Hosts. The taxes vary and may include calculations based on a flat rate or percentage rate, number of guests, number of nights, or property type booked, depending on local law.
Which is better, Airbnb or Vrbo for owners? ›
Airbnb's interface is more user-friendly and community-driven, with more flexible cancellation policies and higher booking volume than Vrbo. Vrbo offers robust property protection but generally sees fewer bookings and has a more complex platform than Airbnb.
Is an Airbnb a good tax write-off? ›
You can write off your Airbnb stay if you are traveling for business and have unreimbursed expenses. You cannot write off an Airbnb stay if you are traveling for pleasure.
What are the extra fees for Airbnb? ›
The additional fees you can collect
- Cleaning fee: Cover cleanup costs after guests check out.
- Pet fee: Make it easy to welcome pets by covering the cost of expected cleaning. Remember, service animals always stay for free.
- Extra guest fee: Add a fee for each guest you're willing to accommodate beyond your normal limit.
An Airbnb costs, on average, $6k to start — assuming you already own the property. Putting everything together, Airbnb costs include: Cleaning and maintenance (e.g., supplies, cleaner fees) Amenities (e.g., purchasing workspace items)
What are the costs of managing Airbnb? ›
Management fees for half-service solutions typically range from 10% to 15% of your monthly short-term rental (STR) income. This option includes essential services such as listing optimization, advertising, booking management, revenue strategy, guest communication, tax collection and property damage protection.
What are the extra fees on Airbnb? ›
The additional fees you can collect
- Cleaning fee: Cover cleanup costs after guests check out.
- Pet fee: Make it easy to welcome pets by covering the cost of expected cleaning. Remember, service animals always stay for free.
- Extra guest fee: Add a fee for each guest you're willing to accommodate beyond your normal limit.
An Airbnb costs, on average, $6k to start — assuming you already own the property. Putting everything together, Airbnb costs include: Cleaning and maintenance (e.g., supplies, cleaner fees) Amenities (e.g., purchasing workspace items)
