Airbnb Property Management FAQ: How It Works, How Much It Costs, Does It Pay for Itself?
Airbnb is a great way to make additional income out of your property. But when it comes down to it, it involves a substantial amount of work to keep the show running. Washing bedding and cleaning your home top to bottom 4 to 5 times a week (often with a short turnover) is not for the faint of heart. If you have a full-time job, don’t live near your listing, or want passive income, the work involved in successfully running an Airbnb can be especially burdensome. Outsourcing this work to a property manager may be just the solution you need. Here are the answers to some of the most pressing questions when it comes to Airbnb property management.
How Does Airbnb Property Management Work?
The beauty of owning a property you rent out via Airbnb is that you don’t actually have to do the work. You can simply outsource the management of the property and reap the financial benefits. When you outsource Airbnb property management you are essentially paying a company or individual to run your Airbnb for you. Depending on the property manager you hire, you can get help just running a specific aspect of the listing or you can get a full-service management solution.
Airbnb property management may include:
- Creation and continual optimization of your listing
- Help with competitive pricing based on competition, local markets, and events
- Responding to guest inquiries prior to booking
- Coordination of check-in/check-out
- Key management
- Point of contact for guests during their stay
- Serve as 24/7 emergency contact for guests
- Manage all maintenance issues and repairs
- Handle any resolution claims with Airbnb
- Respond to complaints
- Troubleshoot any problems
- Monitoring of guest reviews
- Coordination with cleaners
- Replenishment of consumables
- Accounting and bookkeeping
Types of Airbnb Property Managers
When you start to look into Airbnb property managers, you’ll discover there are many different kinds of property managers available. Some will offer complete packages while others will only offer limited areas of management. Here’s a quick break-down of the kinds of property managers you’ll come across in your research:
Generalists
Some companies offer property management for many different types of properties, including office buildings, long-term rentals, short-term rentals, vacation rentals, etc. These property managers are best qualified for listings that get rented for extended periods since the weekly management is lower. However, they will still need to be familiar with the guest screening process and keep an eye on the property.
STR Specialists
A property manager that specializes in short-term rentals (STRs) focuses solely on properties that are listed on Airbnb or similar sites like VRBO, etc. These property managers will specialize in managing frequent guest turnover, key exchange, cleaning with a short turnaround, etc.
Why Should I Get a Property Manager?
Getting a property manager for your Airbnb listing can help you be as hands-on, or hands-off, as you want. Hiring a property manager means you can outsource the entire process and have your listing serve as passive income. If you’re not ready to let go completely, you may choose to simply automate parts of the process. This can drastically reduce the amount of time you put in each week to manage your listing.
How Much Does Airbnb Property Management Cost?
When it comes to the cost of Airbnb property management there is no one-size-fits-all figure. Instead, fees are dependent on the property size, occupancy rate, location, and services required. That being said, there are two different cost models property managers often use.
Commission Model
A commission model is the most common payment model. With this model, property managers take a percentage of your nightly booking to cover the cost of their services. This model gives you, the homeowner, flexibility to use your property occasionally, only opening the rental calendar when you won’t be using the property. Property manager fees range from 15-40%, with the US average being 28%. This model often requires a yearly contract.
Guaranteed Model
Some property managers work with a guaranteed payment model instead. With this model, you are guaranteed a fixed rental income for the weeks you want to rent out your home. The property manager will pay you the fixed amount, regardless of occupancy. With this model, you may make less than you would with a commission model. However, you’ll get a guaranteed monthly income.
Beware of Hidden Fees
It is important to carefully review the fees charged by property managers. Many times when commission rates are low, there are additional fees added. These fees may include fees for credit card processing, deep cleaning, cleaning supplies, linens, maintenance services, etc.
Does Airbnb Property Management Pay For Itself?
So, does Airbnb property management pay for itself? Yes and no. Honestly, it really depends on your specific case.
Airbnb Property Management Pays For Itself If…
- You live far from the property listed (saving on travel cost)
- Your listing is your side hustle
- You have a full-time job and limited time to manage the listing
- You can negotiate a reasonable price
Airbnb Property Management Does NOT Pay For Itself If…
- You live near your listing
- You have time to manage the listing yourself
- You prefer to be in control of your properties
- You want to manage the property and listing yourself
How Do I Find a Property Manager for My Airbnb?
Finding a property manager for your Airbnb listing can be as simple as performing a search on Google. You may also want to ask in online forums or relevant Facebook groups if other hosts have recommendations for property managers in your area.
Questions to Ask Property Manager Before Hiring Them
When you start looking for a property manager, you should never hire the first property manager you contact without getting detailed information on their experience and how they work. Here are some questions to help you make sure the property manager is the right fit for your property.
How many properties are they currently managing?
This should be your very first question to anyone you are considering hiring as a property manager. If they are not currently managing any properties, you want to move on to the next potential candidate. You want someone with experience. If other hosts are not using this property manager, it’s usually a good idea to steer clear. On the other hand, if they are managing more than 10 properties, find out how many people are on their team and how they will manage to take on your listing as well.
Do they manage the property locally or do they remotely manage properties?
While it can be convenient to find a property manager that is local to your listing, some operate remotely. Remote property managers will work with teams in your listing’s area to make sure your property is taken care of. However, it depends on your comfort level and their track record before deciding to move forward with either a local or remote property manager.
What properties are they currently managing?
Take time to look at the different properties the manager is already managing. Look carefully at their listing, and also take time to read through their reviews. This can indicate how they manage the properties they currently have. For instance, if you find numerous reviews about problems with cleanliness or insects, it may indicate that they are not diligent in maintaining the property to 5* standards. Therefore, you may want to find a different manager for your listing.
Do they have other properties in your local market?
With property managers often helping determine nightly pricing, they must understand your listing’s market. Working with a property manager that already manages other listings in your area means they are aware of the market, pricing, local events, etc. to help you set appropriate prices and maximize occupancy for your listing.
Do they have references or current clients you can speak with?
Before hiring a property manager, get references. These references should be other clients they work with. Take the time to reach out and get these client’s feedback on working with the manager. You’ll want to verbally ask these references how their experience has been with the manager, what the manager could do better, and why they continue to use them. This will give you insight as to what other clients think about the manager and can help you make your decision to use them for your listing.
What sets them apart from other property managers you could hire for your property?
Every property manager has that unique selling point. Perhaps it is offering guests a small practical surprise when they arrive at the property, or maybe the manager is good at creating digital guidebooks for their listings to help guests navigate the home and the area. Find out what the manager does that makes them stand out from the crowd.
It Boils Down to Time
Essentially, the decision to use an Airbnb property manager is really dependent on how much time you want to personally put into your listing. If you have the time to put into your listing to make it run smoothly and maintain standards, then it may not be feasible to pay a property manager. However, if you live far from your listing, have a listing as a side hustle, or simply want to be hands-off, hiring an Airbnb property manager may just be worth it. But before you jump in, always make sure you