Airbnb is quickly becoming a very popular way to invest in real estate. Some people are opening their very own homes to guests by renting out a room while others are buying a property specifically for short-term rentals. These investments are really paying off since many travelers love to stay in an apartment over a hotel. It could be because they are usually closer to where they want to be or simply want to pay less than what they would for a suite.
The problem for many owners is that they don’t have enough experience to understand the right path forward. Many mistakes are made that end up costing them money. In some cases these mistakes can completely sink their investment. In this article, we will cover the most common mistakes so you can avoid making them yourself.
1 – Not taking care of the property
Unfortunately, many new Airbnb investors will neglect to update or maintain their property. For some it’s in an effort to not spend too much money and have a healthy profit margin. For others, they are too busy with lots of properties to be able to spend enough time taking care of them.
It is extremely important to make sure that the properties are well maintained and in perfect condition. Saving money by neglecting a property is only going to cost you a lot more money in the long run. You’ll start getting bad reviews which will impact your ability to attract guests and you’ll make less money. In other words, it is not a way to treat your investment.
If you are not able to take care of your property then look at the top ten condo property management companies in Toronto GTA as one of them will suit your needs. A property management company will be the one that the guest call if there is a blocked toilet. They can also handle hiring the cleaning company to clean up after a guest leaves to get ready for the next one.
2 – Buying the wrong property type
When you are looking to buy a property for Airbnb it is important to understand the market. This is because there are many different types of travelers who have different needs. Each area attracts different types of travelers so it’s up to you to understand what type of property they will need.
For instance, tourist spots that attract lots of families will require that you have a property big enough for multiple people. If it attracts lots of backpackers then having small, studio apartments for solo travelers is best.
3 – Picking the wrong area
Everybody knows that location matters, but if you buy a place that looks good on paper but doesn’t get enough tourists then this is the wrong area. Make sure to understand if there are enough tourists or business travelers to make it a good investment. The location should also be close enough to the tourist attractions to be worth it.