Is Airbnb Right for Your Investment Goals?

Why Being an Airbnb Landlord Makes Sense

Airbnb has taken the accommodation world by storm and now has more listings available than the top 5 hotel chains in the world combined. Guests can book almost anything on Airbnb – from treehouses and tiny homes, to luxury seaside mansions and skyscraper penthouses. Many landlords have made the switch to Airbnb (A.K.A short-term rental) around the globe, but does this switch make sense for your own investment goals?

Although short-term rental is very lucrative for the correct properties, there are some key differences between tenancy rental and short-term rental which all landlords need to be aware of when thinking about switching over.

One major difference is that short-term rental is a commercial activity so does not fall under the RTA. Instead, you have to make your own house rules for guests and standards of accommodation. Guests will leave you online reviews based on your offering so it’s very important that standards are kept high.

Short-term rental is a GST liable activity so you would need to register for GST if the $60,000 per 12 months turnover threshold is reached. It’s best to speak to your accountant about the implications of this as there can be both positives and negatives depending on your goals. You can also contact us for a free short-term rental appraisal to know if your property is likely to cross the threshold or not.

Short-term rental is much more flexible than locking in a 12 month tenancy and a lot of landlords enjoy this aspect of Airbnb as well. Some landlords use their Airbnb properties themselves for holidays or when friends and family visit, and if you want to sell your property as vacant then it’s very easy to block off the calendar online and stop guests from making new bookings.

Another major benefit is that landlords and short-term rental managers have much more control over how and when the property is used, and troublesome guests can be evicted if they break your house rules. Although it’s not needed very often, Airbnb also offers $1M cover for any damages caused by guests and claiming for this is quite a simple process.

There is currently a shortage of short-term rental listings on the market so now is the perfect time to try out this new way to invest.

If you are interested in taking advantage of the amazing opportunity the short-term rental market offers, then please reach out to us at Zodiak Management to learn more about how short-term rental works and if it is the right choice for your investment goals.