How to Join the Sharing Economy and Make Money with Airbnb

car in front of an Airbnb property

Airbnb Overview

The year was 2008; the setting, San Francisco. Two roommates named Brian Chesky and Joe Gebbia were struggling to make their rent when one of them had a brilliant idea — Airbnb.

They knew a design conference was coming to town, and hotel rooms were scarce, so to make a few extra bucks, they decided to rent out their loft apartment with a few air mattresses and provide breakfast in the morning. Three guests and $240 later, Chesky and Gebbia knew they were onto something.

Fast forward 12 years and an additional friend (Nathan Blecharczyk) later, and Airbnb is now a billion-dollar multinational company. The premise is simple—you have a spare room or apartment you want to rent out. Someone traveling in your city wants to stay in the comfort of a proper home. You post your listing to Airbnb, the traveler finds it, and they pay to stay in your home. You act as a temporary hotel and share your home for the agreed-upon amount of time.

What started as glorified couch surfing is now comparable to renting out condominiums, but at a much more competitive rate. Individuals can compete with the hotel industry and make a fair amount of cash in the process, just by sharing their homes.

But Airbnb didn’t stop at just connecting homeowners with travelers. Since 2016, hosts have been able to offer full experiences such as wine tastings, city tours, paddle boarding excursions, and more. It’s become one of the major player’s in the gig economy, but how exactly does it work? Can you use it to make a decent income?

How to become a Guest

From here on, we’ll be using two terms common to an Airbnb experience – host and guest. A host is a person who rents out their property or offers an experience. A guest is a person who stays in a host’s home or pays for an experience. Let’s walk through the process of using Airbnb from a guest’s perspective. Please note that guests must be at least 18 years old to use Airbnb.

To rent a property or book an experience, a guest must first make an Airbnb account. Signing up is entirely free and easy to do. Just provide an email address, birthday, and name, as well as a password.

Guests will then be asked to agree to the Airbnb terms of service, which state that users must treat everyone equally, “regardless of their race, religion, national origin, ethnicity, disability, sex, gender identity, sexual orientation, or age.” Alternatively, users can sign up through a Google or Facebook account.

After making an account, a guest then has the option of searching for a place to stay or an experience. If looking for a place to stay, they should type in their desired location, arrival and departure dates, and the number of guests staying in the property.

Airbnb currently has listings in 190 countries worldwide, so finding somewhere to stay shouldn’t be an issue. After inputting the desired location, guests can narrow their search to shared rooms, private rooms, hotel rooms, or an entire apartment. Other filters include price, number of beds, number of bedrooms, and number of bathrooms.

When a guest finds a listing that speaks to them, they can view the property, read the description, and decide whether it’s what they want. When reserving a property, Airbnb asks that guests provide a short introduction and explanation of what they’ll be doing in the city.

Hosts set their own home rules, and guests will be expected to abide by them. After sending a reservation request, the guest must wait for the host to approve it. If approved, the guest and host will be able to communicate through the Airbnb messenger and set up a check-in plan.

Booking an experience follows much of the same format. Guests input their desired location and a date, and Airbnb shows all experiences offered in the area for that day. When guests find something interesting, they can explore details such as available times, duration of the experience, the maximum number of guests allowed, a description, and the hosting language. If suitable, guests check out like they would with a property.

Guests do not pay hosts in person. Instead, all payments go through the Airbnb app or website. This helps protect guests and guarantees that hosts are paid on time. Guests have the option to split costs between friends, and Airbnb is compatible with PayPal, debit and credit cards, direct deposit, and a few additional payment options.

How to become an Airbnb Host

While hosting a property might sound more complicated than renting one, Airbnb makes the process simple. Because Airbnb has options for multiple property types, a host can rent out everything from their own personal bedroom to an entire empty apartment. Likewise, if a host knows the city like the back of their hand, has a cultural skill, or is talented at an outdoor activity, they could even create and share an experience.

The beginning steps of becoming a host are essentially the same as becoming a guest.

First, hosts should make an account by providing their name, email address, date of birth, and a password. Then they must agree to the terms and conditions set by Airbnb. After making an account, hosts can then list their property by clicking the “Become a host” button in the top righthand corner of Airbnb’s website.

Hosts then provide necessary details such as location, number of guests, and the type of property. From here, they should work to make their listing as attractive as possible.

How to make more money as an Airbnb host

The most successful listings show clear and stylish photos, as well as a well-worded description. The more effort a host puts into their listing, the more attention it will receive.

Hosts can set their own prices, but Airbnb does offer a recommended listing price based on similar properties in the local area. Going too high above the regional average will cause guests to ignore a listing, so hosts should stick to Airbnb’s recommended price range.

Hosts also have control over when their property is available, who stays in the property, and what the property rules are. Airbnb has no control over the host’s property and acts only as an intermediary.

Hosts who wish to offer an experience will be put through a more stringent review process. Airbnb asks that experiences meet a strict set of quality standards, including host expertise, insider access that only the host could provide, and a dedication to connecting with their guests. Hosts must prove that their information is accurate and that they can actively honor reservation times.

If an experience receives too many negative reviews, Airbnb may remove it. To meet these standards, it’s best that a host thoroughly plan out their experience and create a quality presentation before submitting it for review.

What to Expect from as a Host

Airbnb is backed by community standards. As a part of the sharing economy, both hosts and guests are held accountable by user reviews. If a host’s property does not live up to its listing, guests can leave a negative review. If a listing’s rating drops too low, Airbnb may remove it as they would with an experience.

Guests also receive ratings, though, and if they are destructive, unclean, or rude, a host may also leave a negative review. If a guest’s rating drops below three stars, they will lose access to instant booking and may struggle to find hosts who will rent to them.

Thanks to these checks and balances, most Airbnb properties are pleasant, clean, and live up to their listings. Compared to staying in a hotel, a guest can easily find an entire apartment for a fraction of the cost. They’ll find more comfort, more privacy, and a homier environment. Alternatively, staying with a host in a private or shared room – or booking an experience – is a fabulous way to meet and interact with local people.

For hosts, they can also meet new people from around the world and make some extra money on the side. Airbnb does take a small percentage of their profit (usually around 3%, though possibly higher depending on your location), but nothing substantial enough to make it unsustainable for a host.

If you have an open property or room, Airbnb is an excellent way to make some money from it. The amount you make depends entirely on your listing price and location, but most hosts make between $500 and $1,000 a month

Airbnb FAQ

Does Airbnb charge any additional fees?

Airbnb does not charge guests any additional fees. For hosts, they will be charged a small percentage of their profit, usually around 3%. However, hosts may add additional fees for cleaning, pets, or late check-in. They must clearly state these fees upfront, so guests know to expect them before booking.

Is Airbnb safe?

Sharing your home with a stranger and staying in a stranger’s home obviously come with their own risks. Airbnb does their best to vet both hosts and guests, but, ultimately, there’s no way to know who is using their services. There have been some horror stories over the years, but, for the most part, Airbnb is safe. The most likely problem is that a host might cancel a booking before the guest arrives. Guests should also be wary of potential scams.

What discrimination protection does Airbnb offer?

Per their terms of service, Airbnb states that guests and hosts must treat everyone equally. This does come with a few caveats, though. While hosts cannot turn away someone staying in a separate apartment based on their gender, hosts may turn someone away based on their gender if they would have to share living spaces. However, other concerns, such as nationality, sexuality, or religion are not grounds to turn away a guest.

What if I feel unsafe?

If, as a host, you feel unsafe with a guest, use your best judgment. You should communicate clearly before a guest checks in, and if you feel wary about renting to someone, you may turn down their booking request. Just be sure to follow the anti-discrimination guidelines. The same goes for guests. Communication is vital, and if you feel uncomfortable staying in someone’s home, you may cancel your booking.

Does Airbnb offer disability services?

Per the discrimination guidelines, hosts may not turn away a booking because a guest appears to be disabled. However, this does not mean that hosts have to make their homes disability accessible. Most properties will not be readily disability accessible, but Airbnb encourages hosts to try their best to accommodate disabled guests’ needs.

How do local laws affect Airbnb?

Since Airbnb has listings around the world, local laws do sometimes affect what passes on Airbnb. For instance, in countries with anti-homosexuality laws or laws barring women from staying with men outside their families, Airbnb cannot force property hosts to break their local rules. Some countries in Europe, several cities in the United States, and the Japanese government have also passed regulations to control Airbnb listings. If you wish to travel throughout China, you must also register with local police to stay in a local’s home. Be sure to check local laws and guidelines before booking through Airbnb.

How does check-in work?

Checking into a property depends mostly on the host and guest. In most cases, the host will either meet with the guest, leave a key in a lockbox with a code, or hide the key somewhere near the door and let the guest know where they can find it.

The Future of Airbnb

Since the global outbreak of COVID-19, Airbnb has seen a downturn in its overall profit, similar to most other hospitality industries. They plan to go public later in 2020, though, and are back on the upswing again. Airbnb has also introduced new online experiences and are working hard to keep guests and hosts safe.

These measures include new guidelines for cleaning, and they have limited the types of properties that are now available. As a more budget-friendly option to hotels, Airbnb shows a lot of potential for further growth and has quickly proven itself to be a fierce competitor ready to take on hotels and other hospitality services.

Compare Car Insurance Quotes