When you own your own business, pricing and deciding what to charge is one of the hardest things to figure out, and Airbnb is no different; you spend your life wondering whether you are charging the right amount, too much or too little. And it matters. Get it wrong, and you risk deterring potential guests, either because they can’t afford your high prices or because they’re put off wondering why you’re so much cheaper than everyone else. It’s not an easy decision. And, unfortunately, it’s one you have to continuously make as prices should vary and reflect the time of year and what is happening in your area.
So, how do you go about it? For a starting point, Airbnb suggests rates based on your property, amenities and location. But, they’re not set in stone; you’re in control of what you charge. It may be best to start lower and build up some history and positive reviews before increasing your prices, but if you’re still struggling here’s some methods you can try.
Work out your expenditure
There are many reasons why you may want to become an Airbnb host, but even if you are more concerned with the experience and meeting new people than anything else, you still want it to be worth your while financially. One way to ensure you make a profit is to estimate how much you need to earn to cover your costs. To do this, w out how much you spend on things like:
Your rent or mortgage
Bills – council tax, gas, electricity, WiFi etc.
Property management - maintenance, cleaning, supplies, furniture etc
Once you know your outgoings and how much you’re spending on your property every month, divide it by 30 to get a rough idea of what you need to charge per night to cover your costs. It’s a simple calculation with limited accuracy, especially since it assumes you’re working at 100% occupancy, but it does give you a starting point. If you only have guests for half the month, divide by 14 to see how the nightly rate changes.
Research the competition
What you can get away with charging depends on where you are and what space and amenities you have to offer. One way to ensure you remain competitive, though, is to research what others are charging. Look for similar properties in your area as well as bigger ones, smaller ones or those with more or less amenities and work out where your property fits in. Be sure to keep researching though as new properties will appear all the time and prices will change seasonally.
Talk to us
We, Elite Property Management, understand Airbnb and have considerable experience managing properties in the Edinburgh area. If you need advice about costing or anything else to do with managing your property, give us a call; we are happy to help.