May 9, 2019

What Homebot Teaches You About Airbnb

While it took Airbnb almost eight years of operation to become profitable as a company, homeowners can fare much better and start using Airbnb for passive income anytime they want.

Airbnb started in 2008, but didn’t turn a profit until 2016, according to CNET. Thankfully, their hard work and dedication is homeowners’ gain, as utilizing the app can be a powerful tool in wealth building. Why wealth building, specifically? Because Airbnb is more than just a tool for some extra spending money - it can be key for generating extra money that may be used to help homeowners create even more wealth down the road.

When Homeowners use the Homebot Airbnb interactive calculator, they can calculate potential earnings from renting out a room through Airbnb, and more importantly, see how that extra money can be applied to principal payments to reduce how long it will take to pay off a mortgage. (Note: While paying off a mortgage early can save significant interest costs, it is worth investigating some of the pros and cons of paying off a mortgage early before making a final decision, according to US News.)

So let’s say you run the numbers in the Homebot interactive calculator, and weighed the pros and cons of applying that extra money to your mortgage and decided that it’s the right path. How does one move forward most effectively?

Before figuring out potential earnings, and long before leaving any mints on the pillows, homeowners need to make sure they have their assets covered. According to Airbnb’s website, there is significant coverage for those who decide to rent out their home or a room through their app, with global support, $1 million in damage coverage and $1 million in liability coverage, and a variety of checks and balances to make sure homeowners find the right fit for that extra space, such as reviews and ratings on those looking to rent. It’s worth reviewing (and potentially updating) any homeowner insurance policies, as well.

While Homebot helps homeowners estimate what they may do with their extra money to help generate wealth with Airbnb, the Airbnb website helps potential hosts understand the value and potential earnings for a specific location. Before making any long-term Airbnb plans, understanding what kind of value may be generated and utilizing that value in the Homebot interactive calculator is pivotal for successful wealth generation. If the earning potential isn’t enough, there are additional applicable fees (cleaning fees, pet fees, etc.) that may make Airbnb even more appealing and profitable.

To make Airbnb a long-term passive income opportunity, homeowners also have to make sure they make their space appealing and enjoyable. While this may take some investment, a bad Airbnb posting won’t get many guests and can greatly reduce potential earnings. BuzzFeed has some great tips on becoming a “superhost,” which means people are more likely to come back as well as increase potential income earnings. There are some super easy tips, such as being flexible on check-in and check-out times, going a bit beyond expectations (Most people are brewing coffee in the morning anyway, what’s an extra cup or two?), and effective, clear communication. For those who want to go especially above and beyond, BuzzFeed recommends items like keyless door locks, leaving things to do (like board games), and keeping a constant flow of fresh flowers around.

Once the bases are covered, Airbnb earning potential is established, and the ground rules and usable spaces are clear, set some goals with that newfound passive income. While it is easy to say new income will be used appropriately, it rarely is if goals are not established. According to NerdWallet, some great financial goals include setting up an emergency fund, paying off debts (such as that mortgage mentioned earlier), and save up for retirement. If these goals are complete (Congratulations!), it may be time to start looking into additional real estate for even greater gains.

A generation ago, owning a home meant “you made it” in life. These days, that is just the beginning. Using one’s home to generate even more wealth (which may be used for home renovations, a second home, or a house upgrade - see previous blog) is a homeownership game-changer, and with companies like Airbnb and tools like the Airbnb interactive calculator in Homebot, homeowners have new opportunities that most could only once dream about.

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