How Much Start Up Capital Do You Need To Rent Rooms On Airbnb?

Airbnb Startup Capital

By, Sue Hoyuela

Using Airbnb is the easiest way to start making extra money in your spare time. And the beauty of it is, you can make a six figure income with it, or just a little extra pocket change. It’s up to you to set and define your financial goals. If you’re like me, when I began, I was looking for a way to make an extra $100 per month to put toward paying off my debt. Well, I accidentally overshot that goal by earning an extra $1,000 in my first month by renting just one room in my house. Since then, I’ve developed several different business models to choose from.  Let me help you decide where you can begin.

The first question to ask yourself is, “How much start up capital do I have to work with?” Keep in mind that it is very common to make $1,500 per month just from renting one room so this is an investment that will pay for itself very quickly.

Start Up Capital – $0

calendarSurprising? Yes. But even if you have $0 to start with, you can begin by offering a Reservation Management Service. By approaching people who have extra room in their house and that need extra income, you can offer to help them rent rooms by marketing their space and sending guests their way. I suggest you charge a one-time listing set-up fee of $500 and then take 20% from all bookings. That way the more bookings you get, the more money you both make. Win win!

 

Start Up Capital – $100 – $500
airbed couchWith a nominal start up cost of $100 to $500 you can rent rooms or just an empty space in your current home or apartment. With less than $500 you can buy an air mattress, a futon or a pullout couch and begin renting it out tonight. If you all ready have those, then all you need is fresh clean bedding and you’re good to go. Experience has shown that you should have your first guest within 24 hours and money in your account in the first 7 days. How’s that for quick cash?!

Start Up Capital – $1,000 – $5,000

With as little as $1,000 you can furnish and theme three or four guest rooms in your home. Or, with a little creativity, you can put a tent in the back yard with an airbed, some patio furniture and twinkle lights to create a garden oasis.

You can purchase a timeshare on the secondary market by checking websites like Timeshare Users Group, Redweek or Ebay. Often people are willing to take $1,000 or less for their timeshares. With closing costs of about $750, you can own a timeshare for less than $2,000. The beauty of a timeshare is that they handle the check ins, room cleaning and maintenance for you. Heck you don’t even have to furnish the place.

Rent to Own – you can approach motivated sellers and offer to rent their place from them, guarantee their payments, and rent out the whole house or individual rooms to guests. The startup costs would include the furnishings and putting the utilities in your name. Renting to own is a strategy that gives you many options. At the end of the contract you may choose to purchase the property, extend the contract and keep renting it, or simply return the property to the owner. It’s a great way to “try before you buy” and make a nice sum of money in the meantime.

Start Up Capital – $5,000 – $25,000

mansionLeasing other people’s property is a great way to go. You agree to pay the owner the fixed monthly rent, then you rent the whole house or individual rooms to short-term guests and keep the difference for yourself. Leasing other peoples’ property requires that you qualify based on your credit and assets. Then, based on the number of rooms in the house, you will need enough start up capital to cover the first month’s rent, the deposit and furnishings for the whole house. I use $1,000 per room as a rule of thumb to determine how much it will cost to furnish a house. For example, if it is a 2 bedroom, 2 bath house with a living room, kitchen and den that would be a total of 7 rooms and would require about $7,000 to get started. Of course, you can bring that number down if you are able to negotiate with the landlord to provide the appliances and some furnishings, especially beds and couches.

The nice thing about leasing other people’s property is that you are only responsible to pay the rent and utilities each month. The landlord is responsible for major repairs. And it doesn’t hurt to ask if the landlord will pay for the gardener and other utilities as well to help reduce your monthly expenses even more.

Start Up Capital – $25,000+

With $25,000 or more you can consider purchasing other properties. You will need enough to cover the down payment, closing costs (or you may get the seller to pay those), repairs, furnishings and utilities. That’s if you’re buying a single family residence. Of course, if you are buying vacant land, then it is much simpler and more affordable to get started.

So the first step to building your Airbnb empire is to do an assessment of your current situation to determine how much start up capital you have to work with and go from there. Setting realistic goals and expectations is the key to succeeding with Airbnb. Let me encourage you to simply start where you’re at. As you learn and grow in your experience and reputation, the rest will follow.

Leave A Reply (6 comments so far)


  1. Darren
    1 year ago

    How do you market we’re in Winnipeg Mb?


    • admin
      1 year ago

      Darren, I would look for a place within a 10 mile radius of the Forks and the Convention Center. Target the corporate travelers and folks who attend the festivals, concerts and conventions. Sue


  2. Eduardo
    1 year ago

    Dear Sue:

    I have tried to reach Airbnb, but being able to obtain a phone number or an e-mail, as they run this business.

    So I can strat looking into how to run this business and make it grow,

    Do you have thier phone number and / or direct e-mail you can spare with me.

    Eduardo


    • admin
      1 year ago

      Eduardo, Hello!

      Thank you for posting a comment on my blog post. I will do my best to answer your questions. However, I need to clarify one thing. Airbnb is simply a tool. They are a booking engine for reservations and they collect payments. That’s it. So, the phone number for Customer Support will only provide you with answers to trouble shoot issues surrounding those areas. They do not provide any business set up advice whatsoever.

      The good news is that you have come to the right place if you are looking for information on how to run this business and make it grow.

      There are so many ways to use Airbnb to create a little extra income in your spare time or build your six-figure vacation rental empire.

      After reading this post (https://doubleyourrentalincome.com/how-much-start-up-capital-do-you-need-to-rent-rooms-on-airbnb/) and deciding where you want to start, go ahead and create your listing on airbnb. Here is a link to get $50 from Airbnb when you host your first guest: https://www.airbnb.com/r/shoyuela?s=8&i=
      Next, if you want to really ramp this up and create a six figure income lifestyle that allows you the financial freedom and time to pursue your dreams, then I suggest you get my online course.

      With over 5 years of hosting and coaching experience and 1,000+ positive reviews on Airbnb, I can get you on track to vacation rental riches in record time. Check out my Vacation Rental Profit System online training course here: https://doubleyourrentalincome.com. Eliminate the learning curve and go straight to profits.

      To Your Success!

      Sincerely,

      Sue Hoyuela


  3. Heather
    1 year ago

    Hi Sue,
    I have quite a few questions, do you have an email address that I can reach you on?
    Thanks!
    Heather