Airbnb is a wonderful platform that can help you pay off your mortgage, leading to cash flow on your properties and eventually financial freedom. However, for new hosts, the user interface can be a bit tricky to navigate, with important settings hidden behind different menus. However, if you follow these 5 steps as a new host, you'll begin your short term hosting career on the right path.
Turn on Instant Book
Instant Book is one of the major inputs in where you rank when somebody searches for a property in your area. Do a search in your area right now, or better yet in a busy city like New York City, and you'll notice that the first few listings all have Instant Book turned on.
This makes sense from Airbnb's point of view. How disappointing of a guest experience would it be, if somebody fell in love with a listing only to be denied a booking (thereby denying Airbnb revenue)? So why would Airbnb waste their most premium space in the search results with listings that may not convert over to a booking? The answer is that they wouldn't. If your placement doesn't have Instant Book, it will be much further down the page leading to a loss of revenue.
One of the main reasons hosts do not turn on instant booking is that they worry they'll get a bad guest. While this is a fair concern, it is easy to ameliorate. In the instant book settings, there's an option to only accept Instant Bookings only from guests who have "Recommendations from other hosts."
This setting requires that guests who are looking to Instant Book have both positive reviews and no negative reviews. This is great because it ensures that you are only dealing with guests who have familiarity with the platform and have had good experiences with their hosts. Guests who are first-timers on Airbnb often think this short term rentals are like a hotels, and expect a hotel-like experience, leading to stress for the host and a negative review when they realize that a host may not have all of the amenities of a standard hotel.
And of course, the "no negative reviews" will automatically filter out any bad guests. It's pretty difficult for a guest to earn a negative review, as most hosts I know are appreciate of the stay and the relationship. Even when something minor goes wrong, generally the host will choose not to leave a review at all for the guest. For a guest to earn a negative review, they must have incurred a truly terrible experience for the prior host. You of course, do not need to host anybody who is a troublemaker.
Research your Competition and where your Listing Ranks
Every few weeks or so, you should search for your town and the maximum number of bedrooms you offer to see where you rank. When you search, make sure you are in an incognito browser session to mimic the search of a real guest, otherwise, your search result will be personalized by Airbnb to be higher than where it would be naturally.
If you are not "above the fold", meaning in the top 1-5 search results, you will get significantly fewer bookings. Take a look at what your competition is doing right. Do they have better reviews? Do they have lower prices? Look at the number of pictures they use (hint: too many pictures is just as bad as too few). How is the thumbnail of your listing compared to theirs? Do they have professional photographs while yours were taken on your smartphone?
There's a lot you can do to get ranked higher. Just because you're a new host doesn't mean you won't rank highly. As a matter of fact, Airbnb will highlight that you are a new host and give you a boost in the search results for the first few months that you are on the platform to solve the chicken and egg problem. But after that initial burst of goodwill from Airbnb, it's up to you to stay ahead of your competition by offering a superior experience.
Test Turning off Suggested Pricing
If you find that your occupancy is already very high, then it's not worth utilizing suggested pricing. I've found that suggested pricing is usually much lower than where the market for my properties will actually clear, leaving money on the table. Instead, when determining price, I like to again research of what's available throughout the area and price my listing to a premium since it's generally going to be a better experience than what my competitors can offer.
If you want to test out the algorithms, you can try dynamic pricing from a myriad of companies. Brands like Beyond Pricing will automatically tweak the daily prices of your property based on seasonality, weekend rates, competition, etc.
A/B test your Thumbnail
People look at pictures first, reviews second and host notes last. It is crucial to test a variety of hero shots of your property and to track what the "click-through rate" (percentage of people who see your listing then click on it) is whenever you set a new thumbnail.
A great thumbnail will have a huge impact on your search rank and conversion to booking. I recommend hiring a professional photographer. You'll make back the few hundred dollars easily in increased bookings.
You should also try to have multiple versions of thumbnails depending on seasonality. For example, a ski chalet being searched for in December utilizing a sunny thumbnail from last July, with no snow on the ground, doesn't exactly conjure up dreams of fresh powder to potential guest who are seeking a ski trip getaway.
Some guests may even think that if you are too lazy to adjust your thumbnail for the right season, what else are you too lazy to think about?
Set a 2 night minimum for weekends. Set a 3 night minimum for holidays and weekends
In general, you should have a 2 night minimum for weekends as those are your prime days. You can also set specific 3-night minimums. This feature is a bit hard to find and not directly accessible from the calendar, but rather the listing menu.
Underneath the trip length section, you can "add another requirement" wherein you can specify different minimums for different nights.
In addition to separating nightly minimums for holidays and 3-day weekends, be sure to also adjust your price up accordingly. The last thing you want to do is have a guest snipe your underpriced listing a few months before the holiday when you could have charged twice as much and significantly increased your profit.
Bonus Tip: Leave Enough Preparation Time
If you are a brand new host or just working with a new cleaner, then you'll want to avoid same day turnover. It's incredibly stressful and there's always a chance things will go wrong with somebody who hasn't been properly trained and checked. When working with a new cleaner, I inspect their first few cleanings before deciding to work with them full time.
If you toggle on preparation time, you can block the night before and after each reservation so your cleaner has ample time to clean. While this may cut into availability of nights in the long run, for a first time host, it's really about garner a great first experience. Only after you feel that you've got a good working relationship should you toggle this back off.