Investing in a turnkey Airbnb property can seem like a golden opportunity, especially for those looking to dive into the short term rental market. However, it’s crucial to approach such investments with a clear understanding of what to expect. Here’s a breakdown of common pitfalls and opportunities to maximize your investment.
Profitability: A Closer Look
One of the first things to consider is that many turnkey Airbnb properties are often not as profitable as they appear. Properties that are for sale typically have been on the market due to declining bookings or lower-than-expected revenue. Sellers may be offloading properties that haven’t performed well, which can lead to a false sense of security for new buyers. It's essential to do your homework and analyze the property’s financials and similar properties in the short term rental market carefully before making a commitment. Understanding what similar properties earn in a year and shortcomings with the subject property’s pricing and booking policies will be instrumental in guiding your purchasing decision.
Starting from Scratch
When you purchase a property, you may not be inheriting a slew of future bookings or a trove of glowing reviews. Often, previous owners are unable to transfer existing bookings or reviews, meaning you will need to start fresh with a new listing. This can feel daunting, but it also offers you a clean slate to shape your brand and guest experience from the ground up. You can ensure that you maximize your listing and take advantage of the new host boost typical on many short term rental booking platforms.
Wear and Tear: Assessing Condition
Turnkey properties might not be in pristine condition. Many sellers neglect the day-to-day management of their rentals, leading to minor repairs that, while not costly individually, can accumulate and affect the overall guest experience. A thorough inspection is vital; look for small repairs that can enhance the property’s appeal. Addressing these issues is often an easy way to elevate the guest experience and add instant value to your investment.
Opportunity Areas: Upgrading Furnishings
The aesthetics of your property can make or break its success on platforms like Airbnb. Many turnkey investments come with outdated or unappealing decor. For instance, I once worked with a client who bought a property adorned with clichéd signs featuring phrases like “live, laugh, love.” After swapping out generic artwork for authentic local pieces, he significantly boosted the property’s perceived quality. Simple changes in decor can create a more inviting atmosphere and enhance the overall guest experience, leading to better reviews and increased bookings.
The Importance of a Unique Touch
In a saturated market, offering something unique can set your property apart. Consider adding that special piece or amenity to give your listing the WOW factor. Think creatively about your target guest and choose the amenity that will wow this guest. Perhaps it’s a tipi in the backyard, or an outdoor movie theater or a climbing wall in the game room. This personal touch can lead to better reviews and repeat bookings.
Purchasing a turnkey Airbnb investment can be rewarding, but it requires careful consideration and a proactive approach. By understanding the potential challenges and opportunities, you can position your property for success. Focus on enhancing guest experiences through small repairs and thoughtful decor choices, and you’ll be well on your way to creating a profitable short term rental. Happy investing!
