If you’re considering hosting on Airbnb, you’re probably thinking about handling everything yourself or hiring a company like KozyGuru to help manage your property. Both options come with their own advantages and disadvantages, and choosing the right one really depends on your individual needs, goals, and how involved you want to be in the process. Let’s take a look at the costs, benefits, and potential challenges of each choice.
Cost Comparison: Hosting It Yourself vs. Hiring Professionals
Managing Your Property on Your Own:
One of the main advantages of managing your rental property is that you get to keep all the money you earn from renting it out, minus a small fee paid to Airbnb and your operating expenses. Since there’s no extra fee for hiring a property manager, this can lead to higher earnings for each booking. However, it’s important to consider the value of your time and effort. If you find that you need to hire someone to help with tasks like cleaning, managing guest communications, or setting prices, those costs could eat into your profits. Still, many hosts like the idea of not having to pay a monthly management fee when they choose to manage everything themselves.
Using a Property Manager (KozyGuru or similar):
If you’re considering using a property manager like KozyGuru for your short-term rental, knowing what to expect is good. Typically, these managers will charge you a fee ranging from 12% to 20% of your rental income. For example, KozyGuru usually takes about 12% to 15%, depending on the services they provide. This fee is taken out of the money you earn from bookings.
Some property management companies also charge extra fees for things like setting up your listing, taking professional photos, or deep cleaning your property. However, many operate under the idea that they only earn when you do, so their pay comes from a percentage of your earnings.
It’s also important to note that if you hire a property manager, Airbnb will still charge its usual host fee on top of the management fee. For instance, if you earn $1,000 in bookings for the month, Airbnb might take around $30, and a property manager charging 15% would take $150. That would leave you with about $820 before other expenses.
While giving up a portion of your earnings, hiring a property manager can save you a lot of time and hassle. They are experts in the field and can help you earn more money by optimising your rental pricing and increasing occupancy rates. For example, they might help you turn that $1,000 in earnings into $1,200 with better marketing, which means even after paying the manager, you’d still end up with slightly more money than if you managed it yourself.
In short, if you decide to use a property manager, expect to pay between 12% and 20% of your rental income. Just remember to weigh the cost against the extra time you’ll save and the potential for increased earnings!
Advantages of Managing Your Own Airbnb
- No Management Fees:
When you manage your own rental, you keep all the money you make from it—nothing goes to a manager. This can really boost your profits, especially if your property does well.
- Full Control:
You are in charge of everything about your rental. You decide how much to charge, what to say in your listing, who to allow as guests, and all other important choices. Knowing you’re looking after your property yourself instead of relying on someone else can be comforting.
- Personal Touch:
Many people who host guests enjoy meeting them personally or adding special touches, like a friendly note or sharing local tips. This personal connection can make hosting more enjoyable and often leads to guests writing glowing reviews about their experience.
- Learning Experience:
Taking care of your Airbnb can teach you much about hospitality and marketing. Many owners find it fun and a great way to learn about what travellers want. You’ll quickly discover what works well and what doesn’t, allowing you to adapt and improve along the way.
Drawbacks of Self-Management
- Time-Consuming & Stressful:
Managing everything on your own means you’re always available for your guests, even at odd hours. This can be really stressful! Imagine dealing with a guest locked out of the house at midnight or spending your lunch break responding to booking inquiries. Cleaning and ensuring everything is in good shape between guests takes much time. All these tasks can add up to many hours each week, essentially turning it into a part-time job alongside your other responsibilities.
- Requires Diverse Skills:
To be a successful host, you need to wear many different hats—like being a cleaner, a customer service representative, a handyman, a marketer, and even someone who understands pricing. Not everyone has these skills or wants to take on all these roles. It can be tough to keep your property appealing to guests by adjusting prices for busy seasons, creating an attractive listing, and making sure everything is functioning correctly, like fixing leaks and ensuring smooth check-ins.
- Handling Problems Alone:
When problems pop up—like dealing with a difficult guest, a sudden repair that needs attention, or a complaint from a neighbour—you have to manage them by yourself. This can be overwhelming, especially for new hosts. Apart from reaching out to Airbnb for help with guest-related issues, there isn’t much support. For instance, if a guest damages something or throws a party, you will be the one figuring out how to resolve the situation and handle any claims. - Staying Compliant:
You are responsible for knowing and following all the local rules regarding rental properties and keeping track of taxes. A mistake in following these rules, like not registering when you need to, could cost you money, and simply not knowing the rules won’t excuse you in the eyes of the authorities. If you manage everything on your own, it’s essential to stay updated on any law changes to avoid any unintentional violations.
Benefits of Hiring a Property Manager
Hiring a property manager can make owning a rental property much easier. Here are some key advantages:
- Time Savings:
Property managers handle day-to-day tasks like collecting rent and managing tenant inquiries, allowing you to focus on other priorities.
- Expertise:
They have experience with local rental laws and regulations, helping you avoid legal. - Tenant Screening:
Property managers can find reliable tenants by conducting background checks and interviews, reducing the risk of problem renters.
- Maintenance Management:
They coordinate repairs and maintenance, ensuring your property stays in good condition without you having to deal with it directly.
- Marketing Your Property:
Property managers know how to advertise rental properties to attract tenants quickly and effectively.
- Financial Management:
They can manage your property’s finances, including budgeting and accounting, making it easier for you to understand your rental income.
- Emergency Handling:
If an unexpected issue arises, such as a plumbing emergency, property managers can address it promptly, ensuring your tenants are satisfied.
Overall, hiring a property manager can reduce stress and improve the experience of owning rental properties.
Drawbacks of Using a Property Manager
- Costs That Eat Into Your Earnings:
One of the biggest drawbacks of using a property manager is the cost. Paying around 15% or more of your earnings to a manager is a significant chunk of your profit. This can be a real issue if your property doesn’t make a lot of money or has tight profit margins. In such cases, some property owners decide it’s better to rent to long-term tenants instead. You’ll need to weigh the convenience of having a manager against the smaller amount of money you’ll take home.
- Less Control Over Your Property:
Having someone else manage your property means you lose some control. You won’t be selecting guests or communicating with them directly. The property manager may make choices you would disagree with, like accepting last-minute bookings at lower prices or using their own style for decorations and furnishings, which might not match your personal taste. While good managers will consult you on important matters and follow your house rules, day-to-day decisions are out of your hands. This can be tough for homeowners who have a strong emotional connection to their property.
- Finding the Right Manager:
Not every property management company is good. A careless or ineffective manager can lead to unhappy guests, damage to your property, or loss of income due to mistakes in pricing or missed chances. It’s crucial to find a reliable, high-quality service. If you choose poorly, you might face issues like cleaning not being done well, slow responses to guests, or even problems with your money. Do your research—read reviews, ask for recommendations, and understand the terms of the service—to find a trustworthy manager. Some companies, like KozyGuru, emphasise open communication with owners, but always take the time to vet any service you consider. - Long-term Commitments:
Many property management services require you to sign a contract. This could mean you’re locked in for a set period or have to give notice if you want to end the agreement. While this isn’t necessarily bad, it means you can’t just try out a manager for a week and then walk away. Make sure you’re comfortable with any commitments. Also, ask questions like: Can you use the property yourself sometimes? What happens if there are damages? How often will you receive updates or financial statements? A good manager should be flexible about personal use and have clear policies for everything else.
When deciding whether to manage your rental property yourself or hire a property manager, think about what matters most to you. If you live close to your property, have free time, and enjoy welcoming guests, managing it yourself could be enjoyable and might even help you earn more money. On the other hand, if you live far away, have a busy life, or prefer a more hands-off approach, hiring a property manager can turn your rental into a smoother investment experience.
Some hosts in Australia start by managing their properties themselves to learn how it all works. Later, they might switch to hiring a manager as they expand or find the work too demanding. Others choose to hire a management service right from the start to skip the learning process. There’s no one correct answer—it depends on what suits your needs.
If you’re considering hiring a property manager, it’s a good idea to talk to a few different ones and ask about what they offer. A reliable property management service should provide helpful features like adjusting prices based on demand, creating appealing listings, checking guest backgrounds, being available for support at any time, and giving you regular updates on how your rental is doing. They should also understand local laws and rules, such as advice on city regulations or help with registration.
For instance, a company like KozyGuru offers comprehensive management services that cover everything from marketing your property and communicating with guests to organizing cleaning and restocking supplies, and even helping with interior design to enhance your property’s attractiveness. Understanding what services you’ll get for the fee will help you see the value in hiring a manager.
Conclusion: Begin Your Journey as an Airbnb Host
Listing your property on Airbnb in Australia can be an exciting way to earn money and meet new people. Following a simple guide on creating your listing can attract potential guests and share your space with them. It’s important to focus on a few key things: taking great photos, writing a clear and friendly description, and responding quickly to inquiries. These details can really help you succeed as a host.
Before you get started, make sure you understand the rules that apply in your local area. This includes following any regulations your local council sets, dealing with your tax responsibilities, and having the proper insurance to protect your property. Knowing these things from the start will help you avoid any surprises later on.
We’ve also looked into the costs involved in listing on Airbnb. While creating your listing is free, there are some ongoing fees and expenses to keep in mind. If you manage things well, the money you can make from hosting can cover these costs easily, especially if you take advantage of tax deductions and set the right price for your listing. Depending on how comfortable you are with the work involved, you can manage everything yourself or hire a property manager, like KozyGuru. Managing it yourself can be rewarding and save money, but it does require time and effort. On the other hand, using a service can make things easier, though it will take a part of your earnings.
Overall, many homeowners in Australia find that becoming an Airbnb host is well worth their time. You can earn money from a property that isn’t being used all the time, and have the chance to meet interesting guests. With the friendly guidance in this guide, you’ll be on your way to becoming a successful Airbnb host. Enjoy hosting, and remember, if you ever feel stressed, there are professionals and communities of other hosts ready to help you along the way!If you would like additional information regarding short-term rental and Airbnb management services in Australia, please do not hesitate to contact us. We would be pleased to provide you with further details.