Factors To Be Considered When Setting Up The Price Of My Airbnb Listing
There are several important Airbnb pricing strategies and ideas that you must not overlook if you want to be successful in the new share economy with Airbnb listing. You want your pricing to be competitive but you also want it to be lucrative as well. It does no good to price your particular listing at the going market rate if your upkeep costs are higher. Before you can even begin to properly strategics your ultimate price, you will have to look at several factors that affect the price of your investment.
The Home Itself
If you own a home or apartment then you are certainly familiar with the concept of paying the rent, or paying your mortgage as well as any taxes. These are important factors that should be considered at the beginning of any pricing strategy. Your goal is not to lose money every month but rather to make a profit off of your investment. By looking at the base level costs for either renting or paying your mortgage, you can begin to form a foundation of how much to charge per night of occupancy. As you start doing this over months and years, you will even begin to see patterns and you will start to learn what months you need to charge less to be able to make your minimum, and what months you can charge more due to an overabundance of travelers.
Don’t Forget The Bills!
Mortgage payments and rental costs are not the only fees involved with owning an investment property – there are also the bills. Light bills, water bills, sewage fees, trash pickup – all of these are fees that must ultimately be paid by your Airbnb guests; otherwise they will be paid for by you. You do not want to lose out on a rental month because you forgot to factor in heating or air-conditioning charges ahead of time. So part of your pricing strategy needs to also include looking ahead at the weather to see what kind of electrical or water fees you should charge. Charging for high likely usage is common with Airbnb owners as it is the only way to ensure that their utility bills will be met each month while not losing out on the revenue during the time renters stay in the home.
Your Time Is Money
The last tip many Airbnb individuals forget to include in their pricing is that your time is also valuable. It took you time to book, it took you time to confirm reservations, process payments, prepare rooms, particular requirements like business traveler, and clean up after the guests leave. Including these types of booking fees and cleaning fees is an essential element of having a successful Airbnb investment. Remember that you are valuable too! Typically these fees will range anywhere from 2-4% and are considered booking fees. You always need to remember to pay yourself; otherwise you are losing out on time you could put to more productive purposes.
With these three tips as a foundation, you can start to formulate a winning pricing strategy for your Airbnb listing and make your home the place of choice for savvy travelers. If you are still confused, come talk to us. We are Kozyguru, professional Airbnb property management company.