The real estate investment industry is expected to expand in 2023, and DPGO is here to make sure you’re prepared! Choosing the optimal location for your investment is 99 percent of the battle.
How to Begin Searching for a “Airbnb Near Me”
First, what does a “Airbnb near me” entail? It’s quite straightforward; we simply mean a home near your residence that is available as a short-term rental.
Local governments have enacted rules and restrictions to limit the number of vacation rental units in the majority of major American cities. Why would they want to restrict vacation rentals while they are increasing tourist capacity? Well, according to some experts, cities with an abundance of vacation rental homes tend to have higher residential home values and rental rates.
Cities such as New York have imposed a minimum rental term of 30 days to reduce the amount of vacant houses at a time when housing costs have never been higher. Cities with stringent restrictions on vacation rental stay periods are no longer considered safe investments and should be approached with extreme caution.
How to Locate an Airbnb Investment Property Near Me
Step One: Identify Your Target Guest
To launch your vacation rental business, you must first choose who you wish to target with your listing.
Are you a provider for families?
Are you targeting couples? Do you wish to entice professionals and digital nomads? This decision will impact where you purchase a home, the facilities it requires, and logistical considerations such as the number of bedrooms, kitchen size, and parking space.
Why does my target guest’s property preference change? You can attract any type of guest with low costs, but a one-bedroom apartment in a high-rise building is unlikely to draw many family summer vacation bookings. In contrast, business travelers are unlikely to reserve a five-bedroom residence.
Step Two: Consider Your Immediate Surroundings
Self-management of a holiday rental property is arduous. And it’s considerably more difficult when you don’t live nearby. Without these remote Airbnb administration tools, we would wager that it would be nearly impossible. If you don’t live nearby and you want to have a profitable rental property, you will need money to pay for services to assist you with the process. If you do not wish to do so, you should purchase an investment property closer to your primary residence.
Step 3: Do Research
Before putting anything into motion, you must conduct preliminary research. We appreciate Markets by DPGO because it’s free, simple to use, and provides an overview of the overall investability of a particular target market.
There are further investigational tools available, but you must pay for them.
Step 4: Examine Key Metrics
As a real estate investor, locating an “Airbnb near me” property is not simple. In fact, many of the data types you will need to consider will be entirely foreign to you.
Knowing the Average Daily Rate can help you set competitive prices for your own listing and attract more guests. It’s important to keep an eye on this metric and adjust your pricing strategy accordingly.
By combining the Average Daily Rate and Occupancy Rate, you can calculate your potential revenue and make informed decisions about when to increase or decrease your prices. This data can also help you identify opportunities to optimize your listing’s performance and maximize your profits.
By analyzing the Day of the Week Occupancy metric, you can adjust your pricing strategy accordingly to maximize profits on high occupancy days. Additionally, you can consider offering promotions or discounts on Wednesdays to increase bookings on the least popular day.
Market Supply indicates the number of active listings in your chosen market. While the present Market Supply of a market may not be particularly relevant, historical comparisons are extremely useful. This will display the number of active listings every month and thus the most popular months.
What are the vacation rental regulations in your desired destination?
New York is undoubtedly the most famous and populated city with short-term rental restrictions. The municipal government of New York has enacted a 30-day minimum stay requirement, thus putting an end to short-term rentals throughout the city. You can still rent out a room in your home for a few days, but there is a 30-day minimum stay requirement for complete property rentals.
Once you have compiled a list of suitable places, you should investigate the city’s regulations on short-term rentals. If you are only permitted to rent out a single room in your residence, it is not an appropriate investment location for a short-term rental of the entire property.
