What started out as a small trend has rapidly grown into one of the most popular ways for travelers to stay comfortable while on the move. By 2022, the statistics project that over 45 million American travelers will be Airbnb users. In order to reap the true advantages of being an Airbnb property owner, it is critical that your price aligns with the expectations of your prospects. Many short-term rental property owners start out at a set right and they are never confident about when they should adjust those initial rates. Here are a few things to consider.

Examine rental prices of similar properties in the area.

Periodically, it is a good idea to get a look at similar Airbnb and short-term rental properties in the area where your property is located. Just as it is with the standard housing market, the costs of short-term rental can rise and fall with various changes in the area. For example, if a high number of new rentals show up, you naturally have more competition and more availability, so prices can go down. Every few months, it doesn’t hurt to take a look at competing properties and see if your property offers a competitive price per stay. If not, it is a good time to adjust.

Look at your profit/cost margins.

Rental property, specifically short-term rental property, can come along with good profit margins, but you do also have costs to contend with. If you have noticed your costs have grown a bit and your profit margin has shrunk, it is a good sign that you need to adjust. The occasional uptick in property upkeep costs, utilities, and more is a normal change with time; adjusting your rates to compensate for those costs is important.

Determine what factors influence guest cost decisions.

The factors that influence a prospective guest’s decisions about what they pay can be diverse depending on what may be taking place at any given time. Of course, there will be personal factors that are out of your realm of possibly knowing, but economic factors are easy enough to examine. For example, if the economy is not at its strongest due to some type of societal issues like a pandemic or falling stocks, you may need to adjust your rates if your property is not getting enough interest.

Keeping your Airbnb rental at a healthy price point is the key to a continuous and healthy income. If you need help with property management for your Airbnb rentals, reach out to us at Sojourn Properties for help.