estimate costs

It is important to understand that you will have two types of costs when you start your Airbnb business: (1) initial costs and (2) recurring costs.  Besides the initial expenses of setting up a short-term rental, there are other recurring costs like utilities and cleaning supplies to keep in mind.  Getting a sort-term rental ready to receive hosts has a lot of hidden expenses that you must be aware of to make an educated estimate.

Initial investment

In order to be successful, you will need to make an initial investment in your unit.  We’re not saying don’t use any old furniture or decorations that you already have, but we are strongly advising that you be very selective in what you use.  Don’t use anything damaged, worn, or discolored.

For starters, your rental must be comfortably furnished and stocked.  Things like a comfortable sofa or loveseat, a television, dishes, a microwave and several other essentials must be provided.  

 

The Cost Estimate Worksheet lists the items you will need to start out, including furniture, linens, kitchen and other items.  You can list your costs in the column on the right.

 

A good way to get an idea of costs is to visit a site like Amazon, Walmart, or Target and fill your cart with everything you will need to get a subtotal of how much everything will cost.

Recurring costs

Different hosts will have varying recurring costs. Following are some of the most common

  • Mortgage/rent

  • Insurance

  • Cleaning costs

  • Laundry costs

  • Amenities (soap, shampoo, snacks, water)

  • Cleaning supplies

  • Toilet paper

  • Paper towels

  • Trash bags and liners

  • Utilities

  • Cable & Wifi

  • Taxes

  • Business licenses

 

Use the Cost Estimate Worksheet to estimate your costs.

 

A cost estimate will also help you estimate how much you need to make to break even, a very important consideration once you are in business and in deciding whether to remain in business.

The short-term rental market has gotten so competitive, that there are certain items that guests have come to expect.  As of spring 2018, Airbnb is requiring all hosts to provide what Airbnb defines as “essentials.”  These are:

  • Towels

  • Bed sheets

  • Soap

  • Toilet paper

Print the Cost Estimate Worksheet to calculate your initial and recurring costs

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© 2018-2020 by Laura Sesana.