Can You Use Airbnb for Your Investment Property?

A new index by online estate agent Nested, based in London, reveals some very interesting data for property investors.

The data suggests that Australian property investors can make more money renting out with Airbnb than through traditional means. According to the study, Sydney, Perth and Melbourne are among the top 50 cities on Earth where Airbnb could have this effect.

The difference is rather striking. The data suggests that a 3-bedroom house in Sydney would take under seven years to pay off if the landlord were to use Airbnb to rent it out. Comparatively, the same property would take roughly 26 years to pay off if rented through traditional means. These findings fall under the assumption that the property will be tenanted around 80% of the time.

Are traditional means completely dead?

But before you jump on the Airbnb bandwagon, consider the words of property experts who think the data could be misleading.

Firstly, the assumption that a property will be tenanted 80% of the time could be off for many properties. For example, according to Lecturer in Property at the University of Melbourne, Andy Krause, an 80% occupancy rate is unusually high for Melbourne.

However, while Airbnb isn’t an automatic winner for any and all properties, it should be seriously considered. If you own a popular investment property in the city centre, for instance, Airbnb could see you making as much as triple the profit.

One more thing to consider

Just be sure to look into and be aware of the latest happenings with Airbnb before investing in the platform. Airbnb has come under fire recently, with many blaming the app for increasing rent and property prices. Airbnb is technically illegal in many areas across the country, so if it’s found to be a detriment to the property industry, there could be harsher enforcements against its use in future.

Viewed another way, now could be the perfect time to use Airbnb while it’s still available and making property investors a lot of extra money. It’s advisable to consult with your agent and do your research before making any big decisions, but you should certainly consider Airbnb for your investment properties.

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