What does financial freedom mean to you? For most, it means making enough money that they can live the lifestyle of their choice, and not have to worry about how much is in their bank account. It means being able to spend more time with family and loved ones, doing things like hobbies or volunteering for organizations that matter. One potential way to achieve this is with short term rentals via an Airbnb business.
To make the dream of financial freedom a reality without spending endless hours actually making their money, many people strive to find successful streams of passive income. With passive income, there are even more possibilities for actually having the time AND resources to do what you truly love. This blog post will teach you what passive income is and how you can achieve it with an Airbnb business.
Are you ready to make your life easier on a day-to-day basis by reducing stress levels while providing more time for leisure activities?
What is Passive Income?
Passive income is the holy grail of finance. And for good reason! Passive income is money that comes in even when you’re not actively working on your business. Many people dream of having enough money coming in on a regular basis so that they can focus on more leisurely activities, rather than work every day just to pay their living expenses. Sounds amazing, right?
The most common form of passive income comes from real estate investing with rental properties. Other options include owning stock in a profitable company, earning royalties from books or songs you’ve written, and getting paid for the ad space on your car (yes, it exists!).
How Can You Achieve Passive Income with Airbnb?
Have you ever thought about real estate investing and starting an Airbnb business to achieve passive income? One of the best ways to start is to consult with an Airbnb hosting expert (like our team at Skye Management!). They can help you determine what potential income a property you currently own (or want to buy) can bring you each month. This way, you can weigh the pros and cons of buying and renting a property. They can also help you look at the bottom line to see if long term or short term vacation rentals are the right choice for you (hint: it’s usually a short term rental).
Is an Airbnb Business Truly Passive?
When it comes to passive income, some people are surprised when they actually have to put in some work, even if it’s not regularly. Yet, the truth is that nothing is truly completely passive. There will always be some kind of work involved, whether it’s up front work to write a book, buy a property or design an online course, or the cost (and time) of regular upkeep.
The good news is that it does not require a ton of time in order to run an Airbnb business. This means that the income you receive from this type of passive real estate investment can be about as passive as it gets. The bad news? You might have to work harder than if you were employed elsewhere and receiving a salary for 40 hours per week. That is unless you have the right support system in place! That’s where a rental management company can make all the difference.
Passive is Possible with Management
Continual guest inquiries, cleaning, and other general upkeep can make managing an Airbnb property feel like a full time job (or more). Thankfully, you can have the best of both worlds when you choose the right management. You may be worried about the cost of hiring a management company and how it will affect your income margins. Yet, in general, properties that are managed by a high quality company yield higher monthly profits. This is thanks to their attention to little details and excellence that makes your rental stand out and boosts occupancy rate. Thus, it’s really a no brainer if you’re looking for a truly passive income generator.
If You Don’t Have a Property to Rent
Think you need to go out and buy a property to tap into this market? Not necessarily! Here are options to consider to start your small business with Airbnb:
- Rent out your vacation home when it’s not in use. As far as vacation homes go- many people who have them don’t use them enough! A rental management company can help you turn that empty space into great income generating potential.
- Rent out your home (or part of it) when you’re on an extended trip or vacation. It’s like having a house sitter that pays you!
- Rent a room or unused space in your home. There are ways to make it separate from the rest of the home if you don’t want to interact with your guests. OR you can make new friends- whichever you prefer.
- Be a master renter. Rent a property that has short term rental property potential. Just make sure to get the okay from the landlord before getting started.
- Buy a property. Of course, this is always a viable option if you have cash or qualify for financing. Keep your eyes peeled for the dream location or must have fixer upper that you know will be the perfect rental property.
What Can a Property Management Company Do?
Below is just a short list of some of the options that you can discuss with a rental management company. Ultimately, you can discuss a custom package with them that caters exactly to what you are needing.
- Professional cleaning team for timely high quality turnover and upkeep
- Daily cleaning and re-stocking as needed
- Recommendations for listings, decorations, items to stock, etc.
- Keep up with guest inquiries
- Take bookings for guests staying at your rental unit
- Ensure that all check ins are seamless experiences
- And more!
Basically, property managers oversee any necessary tasks and ensure that your property is kept up to standard. That way, it can be rented as needed. This keeps customers happy to ensure 5 star reviews that will keep a steady flow of bookings and income for you.
Financial Freedom with Airbnb
When it comes to passive income, most people are quick to think of stocks, bonds, real estate dividends, and other options that require little attention after they’re set up. However, with the right management company in place, you can make your Airbnb business completely passive as well! Plus, you can expect a lot bigger returns than the other options (both in the short term and long term).
If done correctly, this means you won’t have to lift a finger when it comes time for renters to check in or out of your property. This is good news for anyone that needs some time to themselves after a long day at work, has other business ventures they are trying to attend to, or just wants to spend more quality time with their favorite people.
Ready to push the easy button on financial freedom? What could you do for yourself or your family with more time and money? Everyone deserves to enjoy their life on their own terms, and Skye Management, serving the Southern California area, can help!