In our last article on Career Pivot, we discussed the significance of the new sharing economy for Baby Boomers. The implications are that an increased need for income supplementation will drive retirees to the sharing economy, which is the embodiment of flexible work. The sharing economy, which allows people to make money from things they already own, will become a type of income buffet in the coming decades for those looking to earn supplemental income.
Today we are going to dig a little deeper into one specific sharing economy options, specifically in the home-sharing space. As one of the early pioneers, Airbnb has become synonymous with the sharing economy, and has the widest brand recognition alongside Uber for companies operating in this space.
Airbnb is an amazing business model that has transformed the hospitality industry. For those who aren’t aware, Airbnb is a home-sharing platform that allows Airbnb hosts to rent out space, or an entire home, to a guest. So, if you have a basement apartment, spare room, or an entire house to rent, you can now do so on Airbnb.
But as Boomers, I think you should take credit for this business model. After all, the 80’s TV show Golden Girls was the original introduction to home-sharing no?
Airbnb for Baby Boomers: An Introduction
Founded in 2008, Airbnb has taken the world by storm and is one of the fastest-growing businesses around. Available in over 34,000 cities across 190 countries, Airbnb has welcomed over 60 million guests.
Airbnb is now the largest hotel company in the world, offering over 2 million listings worldwide. Starwood-Marriot, the world’s largest hotel chain, has 1.1 million hotel rooms. Further, Airbnb averages over 425,000 guests per night. This beats all Hilton chains by over 20%!
Airbnb allows you to monetize spare space, whether that’s a room, a section of your home, or your entire property. As an Airbnb host, you can charge to allow people to use that spare space, essentially acting as a bed and breakfast.
The amazing part about Airbnb, and almost all sharing economy companies, is their rating and review system. The sharing economy is premised on accountability and transparency through ratings. So both sellers and users are rated and reviewed, and those are made public for others to view.
Therefore, as an Airbnb host, you can read exactly what other hosts said about a particular guest who wants to stay at your property. Likewise, guests can review what other guests have said about hosts. It’s truly an amazing concept and facilitates a seamless transaction.
Airbnb for Baby Boomers: Meet Nancy
Career Pivot readers, meet Nancy. Hi Nancy! Nancy is a 60-year-old retired teacher from Toronto, Canada, who emailed me last week to tell me about her new Airbnb business. Although I hear these success stories all the time, I want to share this one with you.
Nancy signed up for Airbnb a year ago and has since hosted 25 guests. Nancy considers this a part-time business, noting that only 25% of the year they are hosting someone on Airbnb. Nancy and her husband were apprehensive at first, given the uncertainty and a perceived potential for safety concerns.
These concerns disappeared following their first hosting experience with a Dutch couple. When Nancy received her first inquiry from the couple, she was amazed to see that the couple had 15 five-star reviews from hosts all over the world. “I would have Max and Merel back anytime!” said one reviewer. Another boasted “I want to adopt Merel and Max, they were so much fun!”. OK, Nancy got the point.
Following a positive experience with Max and Merel, Nancy and her husband hosted 24 other guests over the past year, which has added $9,000 of supplemental income.
“But Glenn, you know what the best thing of all is? It’s not the money, which certainly helps, it’s the social interaction. We get to meet fascinating people, hear their stories, share ours, and also share the love of our city,” Nancy told me over email.
Nancy isn’t alone. There are so many stories like hers out there. Think you might be interested? Let’s dive into some preliminary action steps that will help you discover more about the Airbnb option.
Airbnb for Baby Boomers: How to get started
I am a list guy. If I didn’t have my daily task list with action steps, I’d be lost. You could say that my to-do list is my work wife, but please don’t tell my real wife!
So what I want to do now is give you specific action steps that you can take to uncover whether or not the Airbnb option is good for you.
First, you need to answer a strong yes to one or both of these questions: Would supplemental income be nice for me? And/or, do I want to maintain strong social interactions?
Do you? OK, let’s move on.
Do you have a spare room, basement apartment, or entire home you could feasibly turn into an Airbnb rental? Yes? Alright, let’s get into some specifics.
Research Your Area and Similar Listings
The second important thing you need to do is see whether or not your location is a desirable one, and if there are similar listings in your area. The best way to do this is going to the Airbnb and search around your particular location. Also, are there hotels near you? Check Google maps around your home to see. If so, then there may be a tourist market you can tap into.
Review the listings that are already in your city, how many are close to you? What do those listings have as descriptions? What tourist options are they promoting? Is there something you can improve on?
Be sure to take some notes, you are researching a potential part-job after all.
Review Your Income Potential
Alright, so there are listings in your area, and you have a good feel for the Airbnb market. Next, figure out your income potential. There are many ways to do this, but the easiest is to go toAirDNA.co and input your city. AirDNA will then give you some important statistics about your particular jurisdiction, including income estimates.
Become a User Before a Seller
The best advice I can give to people who are first starting out in any sharing economy endeavor, is to become a user before a seller. That is, spend a few nights in an Airbnb home before becoming a host.
Pack your bags, Glenn Carter is forcing you to go on vacation! Consider it employment research, but treat is like a vacation. Go somewhere, stay in an Airbnb, talk with the hosts, and get a feel for the business.
You can never know everything, but speaking with current hosts will give a pretty good idea about what is involved in becoming an Airbnb host.
Airbnb for Baby Boomers: Get Educated
I am going to sabotage this article a little by saying this: there is so much to learn, one article can’t even begin to scratch the surface.
If you’re interested in learning more about Airbnb, please check out our Airbnb resources at the Casual Capitalist. There are also many resources online and books available on Amazon. One of my favorite Airbnb books is Get Paid For Your Pad by Jasper Ribbers.
Airbnb for Baby Boomers: List Your Property
Once you’ve done all your vacationing…err I mean business research, you are ready to list. Sign up on Airbnb and develop your listing. Take out the notes you took when originally reviewing listings in your area and decide what you want to put in your listing.
Remember, Airbnb is not just about a place to stay, it’s about experiences. So do your best to describe the type of experience people will have when they stay with you and tour your city.
Unfortunately, today we don’t have time to get into how to communicate with guests, get your first booking, how to get more bookings, do key exchanges, and all the fun stuff that comes with being a small business owner on Airbnb. We dig a little deeper into this at the Casual Capitalist, but there are also tons of resources available online with a simple Google search.
Now list your property! Thanks for joining us, and happy listing everyone.