Article Originally posted by Meggen Taylor on Forbes.com
Airbnb has provided an extraordinary opportunity for thousands of entrepreneurial homeowners to monetize their property—whether it has been renting out a room or the entire house. In some locations, property owners have even garnered enough profits to cover their monthly mortgage and then some. If you’ve been wondering if you should buy a second property or rent out the home that you already have but are unsure of what kind of profit you could make the folks at Homes.com have done the research for you by breaking out the math. See how your fair city stacks up (or doesn’t) in the real estate sharing economy.
Using Airbnb’s data, Homes.com determined which American metropolitan areas yield the highest and lowest rental prices and how much profit a homeowner could make, in addition to determining which cities provide the best opportunities for Airbnb’ers to make the most money in the quickest period of time. The results of their research are below outlining the cities that are most desirable for renters and which ones to avoid if you are planning on using your property as a moneymaker.
Grant Simmons, VP of Search Marketing for Homes.com tells me, “A lot of home buyers are asking themselves if they buy a bigger, more expensive home if they could rent it out and cover their mortgage. We used the median monthly mortgage payment in all of the cities included in our study and divided that by the average nightly price of Airbnb rentals in those cities and we were able to find the cities where it would take the fewest and most nights of renting to cover your mortgage. While some people rent out only a room, we based our results on whole house rentals”.
You might be surprised to find out that Akron, Ohio came out on top with only having to rent out a property slightly over 4 days to cover the mortgage while tech saturated San Jose took almost 28 days to cover the mortgage bill.
Profit From Airbnb – COURTESY OF HOMES.COM
If you are wondering what the most profitable and least profitable places are to have properties to rent on Airbnb below are Homes.com findings. When asked what makes some cities significantly more desirable marketplaces then others Simmons tells me, “You have to think about what brings people to a location for it to be a successful rental. Are people coming to visit their kids at college or is it a vacation destination? It has also been very interesting to see how tech, employment opportunities, and the speed of gentrification have positively affected certain Airbnb markets. At the end of the day success is driven by supply and demand and you need to know where the demand is”.
