Owning an Airbnb investment property in Australia might be the golden goose you’ve been searching for. After all, short-term rentals are definitely on the rise.
The land Down Under beckons millions of visitors annually, all searching for distinct and pocket-friendly stays. In fact, in a single year, the country hosted 2.1 million Airbnb guests who spent a whopping $2 billion, bolstering 14,000 jobs and contributing $1.6 billion to the GDP.
Talk about demand. With an average guest rating of 4.7 out of 5, this form of Aussie hospitality is nothing short of stellar!
Data from Airbtics reveals that, in July 2022, the monthly revenue for an entire home listing averaged $3,055, while a private room listing brought in around $1,078. The occupancy rates for an entire home and a private room listing were 48% and 42%, respectively. So with all of these numbers on the board, what exactly can you expect by putting your Airbnb up for grabs?
Well, just like any other mode of success, it all depends on the effort you put in. For example, the monthly income and profitability of an Aussie Airbnb host can swing based on several factors like the location, type, size, and quality of the Airbnb rentals on offer. And of course, the market competition and seasonal trends.
Airbnb Investment Success Starts With A Smart Strategy
To ensure your Airbnb business flourishes, you need to spruce up your listing, pricing, and guest experience.
Here are some golden nuggets of advice:
- Craft an attention-grabbing title and a thorough description, highlighting your Airbnb rental property’s unique selling points.
- Showcase your space and its vicinity through top-notch photos and videos.
- Price your property competitively, balancing its value with market demand.
- Use dynamic pricing to tweak your price based on supply and demand.
- Offer longer stay or off-season booking discounts to build baseline demand.
- Maintain open and timely communication with your guests throughout their visit.
- Offer essential amenities and add extra touches to make your guests feel right at home.
- Request feedback and reviews from your guests and respond to them in a polite and professional manner.
- Ensure your property is clean and well-maintained.
Challenges of Running An Airbnb Rental Investment Property
Every rose has its thorns, and running Airbnb rentals is no exception. Here are a few challenges and risks to consider if you’re looking to invest:
- Different Australian states and territories have their own sets of rules and requirements for short-term rentals, like registration, licensing, zoning, taxes, and safety standards. Non-compliance can result in fines or penalties.
- Airbnb property hosts must report their Airbnb income and pay the requisite income tax. If your annual turnover exceeds $75,000, you might need to pay GST as well.
- It’s crucial to have adequate insurance coverage for your property and liability in case of any guest-induced damages or third-party injuries. Airbnb’s AirCover program provides up to $3 million in property damage coverage but doesn’t cover personal liability or loss of income.
- Hosts face stiff competition not only from other Airbnb hosts but also from hotels and other accommodation providers. Monitoring competitors’ prices and performance and adapting your strategy accordingly is crucial.
Unveiling Australia’s Airbnb Hotspots
If you’re eyeing a profitable Airbnb rental property in Australia, you might be perplexed about where to start. Australia, with its vast and varied landscape, is brimming with tourist hotspots. However, the suitability of these locations for Airbnb hosting varies based on factors like demand, supply, and the profitability of Airbnb properties.
Mapping Australia’s Best Airbnb Locations with Airbtics Data
As per Airbtics, the top 10 Australian locations to invest in Airbnb as of May 2023 are:
- Busselton
- Sydney
- Broome
- Dungog
- Melbourne
- Orange
- Douglas
- Esperance
- Gold Coast
- Hobart
These locations shine bright based on parameters like average monthly revenue per listing, occupancy rate, average daily rate, number of listings, and revenue growth rate. Here’s a data snapshot for each location when it comes to seeing which destinations are the best short-term rental markets:
| City | Average Property Price (1-bedroom property) | Average Annual Revenue | Gross Rental Yield | Average Daily Rate | Occupancy Rate | Seasonality |
| Sydney, NSW | A$737,500 | A$57,168 | 7.75% | A$252 | 61% | 51% |
| Melbourne, VIC | A$542,000 | A$51,875 | 9.57% | A$212 | 67% | 33% |
| Brisbane, QLD | A$325,000 | A$48,880 | 15.04% | A$209 | 63% | 52% |
| Adelaide, SA | A$375,000 | A$57,451 | 15.32% | A$190 | 82% | 29% |
| Perth, WA | A$370,000 | A$45,760 | 12.36% | A$135 | 87% | 30% |
| Darwin, NT | A$430,000 | A$67,443 | 15.68% | A$220 | 69% | 82% |
| Gold Coast, QLD | A$529,500 | A$53,651 | 10.13% | A$200 | 74% | 43% |
| Newcastle, NSW | A$695,000 | A$53,669 | 7.72% | A$220 | 67% | 34% |
| Cairns, QLD | A$399,500 | A$45,289 | 11.33% | A$155 | 77% | 62% |
| Sunshine Coast, QLD | A$650,000 | Data not provided | Data not provided | A$302 | 68% | 30% |
These locations, boasting high monthly revenues per listing, are hotspots of demand for Airbnb real estate investing and accommodation. They also exhibit high occupancy rates and average daily rates, indicating the premium prices their listings can command.
Moreover, the relatively low number of listings compared to their population size and tourist arrivals suggests a lower supply of Airbnb accommodation. Lastly, the high revenue growth rates reflect the positive trajectory of the Airbnb market.
Getting Started With Your Airbnb Investment in Australia
For hosts aspiring to steer their conventional investment rental property into the Airbnb rental space instead, here are some handy tips:
Employ a property manager for your Airbnb investment
This is particularly useful if you’re hard-pressed for time or lack the necessary expertise. Short-term rental platforms and management solutions – like GrowHost handle everything from listing your property and interacting with guests, to maintaining your space and troubleshooting any arising issues.
An Airbnb property manager allows you to concentrate on other areas.
Automate your communication and check-in process
Timely and clear communication is crucial for a top-notch guest experience. Tools like Airbnb’s Smart Messaging can automate your messaging flow, sending messages at just the right moments.
Meanwhile, a lockbox, or a smart lock, can facilitate hassle-free check-in and check-out for guests, giving them more freedom and reducing the risk of lost keys or delays.
Smaller details like this always add up.
Delegate cleaning and maintenance tasks
A clean and well-maintained Airbnb investment property is a magnet for guests. Cleaning and maintenance, however, can be energy and time-consuming.
Outsourcing these tasks to a reliable professional service can take this burden off your shoulders and free you up to spend your time improving your rental’s overall experience for guests.
Design a professional profile
Your profile serves as your introduction to potential guests to your Airbnb investments, so ensure it reflects your personality and style.
Choose a clear and inviting photo, pen down a catchy bio showcasing your interests and passions, and verify your identity and contact details. Adding personal touches like a welcome message or a video introduction can make your profile stand out.
Capture high-quality photos
Photos of your rental properties can significantly sway guests’ booking decisions. They should showcase the best features of your property, such as the space, amenities, decor, and views.
Invest in a good camera or engage a professional photographer to capture vivid, sharp photos that encapsulate the charm of your place. Airbnb’s photography service can even provide free professional photos of your property.
Craft compelling descriptions
Your descriptions should complement your photos, providing more details about your property and its offerings. Use clear, descriptive language to emphasise the unique selling points and benefits of your place.
Include information about the location, neighbourhood, nearby attractions, and transportation options. Make sure to mention any special rules or policies that guests should be aware of before booking.
Solicit feedback and reviews
Feedback and reviews are critical for improving your service and building a robust online reputation for your rental properties. They offer insights into what your guests loved and what could have been better. They also help potential guests trust you and choose your property over others.
Encourage feedback and reviews by sending a thank-you message after each stay, inviting honest opinions, and responding to reviews politely and professionally.
Offer additional services, amenities, or discounts
To enhance your guest experience and satisfaction, consider offering something extra, something they might not expect or find elsewhere.
For instance, you can offer airport transfers, local tours, breakfast delivery, or laundry service for an additional fee. Providing extra amenities in your holiday rentals, technology upgrades, toiletries, snacks, drinks, games, books, or Netflix access for free, can also be a hit.
Offering discounts for longer stays, repeat bookings, or referrals can attract more guests and boost your revenue.
Key takeaways
- Australia’s Airbnb market offers promising opportunities for real estate investors due to the high demand from millions of visitors each year.
- Successfully managing an Airbnb property involves challenges like local regulatory compliance and market competition.
- Top Airbnb locations in Australia show high monthly revenues, strong occupancy rates, and potential for growth.
- Utilisation of tools and services for automating and streamlining processes can significantly improve your Airbnb business. This includes using a reputable property management company – like us.
- Understanding your target market, differentiating your property, and delivering consistent, high-quality service is key to a profitable Airbnb venture.
Contact Our Airbnb Rental Experts Now
Whether you’re an existing host or a newcomer to Airbnb investing, the Aussie short-term rental landscape is filled with abundant opportunities. Get in touch with GrowHost to see how we can help you manage your Airbnb property with ease.
