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A successful Airbnb rental relies heavily on its occupancy rate.
The home-sharing industry has certainly grown by leaps and bounds over the past decade. As technology advances and the economy eases back into the pre-pandemic normal, the demand for vacation rentals is again going up.
The pandemic may have temporarily disrupted the industry. Still, now that travel restrictions have been lifted and work from home has given added flexibility, people are flocking to Airbnbs in different destinations at a greater rate. Real estate investors are also looking for potential Airbnb properties left and right. Vacation rentals have become a sound investment strategy today. However, owning a rental property doesn’t necessarily mean it’s smooth sailing from there. Owners also have to ensure that the demand for their property stays up.
What Airbnb Hosts Can Do to Improve Their Occupancy Rates
A rental property owner needs to have a sound strategy that will keep their Airbnb occupancy rate high, ultimately leading to better income. A better and more stable rental income will lead to a faster return on investment. You may be in the best location for an Airbnb investment property, set reasonable prices, and have the finest property on the block, but if you don’t get bookings, none of that matters.
So how can one boost the occupancy rate of an Airbnb property?
1. Pick the Right Location for Your Short-Term Rental
Any real estate investor knows that location matters. It can make or break your Airbnb business. This is why smart and experienced property investors purposefully set aside time to do extensive research on potential properties.
Data is the key to finding the right property. Knowing the current market conditions, its historical trends, real-time Airbnb occupancy rate data, and other relevant factors will help an investor know whether a property is worth investing in or not.
For instance, according to real estate data analytics company Mashvisor, the following cities have 100% Airbnb occupancy rates:
- Haddock, GA
- Middleboro, MA
- Oakboro, NC
- Grandview, TX
- Cerritos, CA
However, even if the latest data shows they all have a 100% occupancy rate, not all of them show great ROI potential except for Cerritos, CA. The city has a pretty decent cash-on-cash return rate of 3.40% and a cap rate of 3.43%.
While occupancy rates matter a lot, so do other essential factors. But you also need to improve your occupancy rate to get a good ROI. Finding the right strategy to maintain that good balance will still depend on how much you know about the market you’re in. Thus, due diligence is highly recommended.
2. Set Your Prices Accordingly
One of the things that can significantly boost Airbnb occupancy rate is having competitive prices. The great thing about short-term rentals is that you can adjust daily rates regularly. But just because you can doesn’t mean you should keep increasing the nightly rate. You need to consider your target market and the different seasons.
Experienced hosts know for a fact that there are peak and off-peak seasons, so they adjust their Airbnb pricing strategy accordingly. This means you can increase your rates during busier seasons to boost your rental income. On the other hand, you should lower your rates during low seasons so that you can attract more travelers, especially the hesitant ones.
In setting prices, you can always turn to rental comps or take advantage of dynamic pricing tools.
3. Aim to Be a Superhost
While you don’t need to be a Superhost to have a successful Airbnb business, having a Superhost status definitely helps increase customer confidence and loyalty. To qualify, you must meet Airbnb’s strict quality standards on top of its initial hosting requirements.
To become an Airbnb Superhost, you need to:
- Complete at least three reservations or ten trips that total 100 nights
- Have at least a 90% response rate
- Have only a 1% cancellation rate except for extenuating circumstances
- Maintain at least a 4.8 overall rating
Airbnb has a comprehensive system that makes Superhost listings more visible and helps them stand out among the other listings on the platform.
4. Know Your Target Market
To have a better Airbnb occupancy rate, a host should also know their market or be more intentional in reaching out to a specific target. Having this information will help them prepare the property and highlight amenities targeted toward a certain demographic.
The first thing hosts can do is to identify their usual guests. Are they business travelers? If so, perhaps a high-speed internet connection and premium coffee on site will make a vacation rental stand out. Do you typically get families as guests? Then perhaps having kid-friendly furniture and a few fun board games will make your business more attractive to them.
Catering to your guests’ specific needs will increase customer loyalty and get you plenty of positive feedback, which is crucial to increase the occupancy rate.
5. Set Your Sights on Getting Positive Reviews
The previous point leads us directly to this. As we have already mentioned, getting positive feedback will greatly affect your Airbnb rental, especially if you’re serious about becoming a Superhost. But even if you’re new to the game, having as much positive feedback as you can will help make your property stand out.
The best way to receive great feedback from your guests is to ensure that your property is fit to receive guests. Everything should be in order. Make sure that the property is clean. The appliances are working. The furniture is in good condition. Someone is there to answer questions about public transportation and attractions. Basically, everything that leads to a great Airbnb experience.
Moreover, hosts should also reach out to guests at the end of their stay to check in on them and their experience. Ask for their feedback and politely suggest that they give you a review on the site. Generally, guests with a pleasant experience will gladly take a few minutes to leave a good Airbnb review and even recommend you to their contacts.
6. Be Involved
An Airbnb host’s involvement should not be limited to just answering inquiries and asking for feedback. While answering messages affects the response rate, hosts should find ways to become more involved in making their guests’ experience pleasant.
On top of being available to answer all questions regarding your rental property, you should also check in on your guests from time to time to see how they are doing and what other things you can do to make their stay even more comfortable. Make yourself available and reachable at all times for any urgent concerns.
Passivity has no place in a thriving rental business. Hosts need to be proactive if they want to increase their occupancy rates.
7. Reconnect With Former Guests
Just because a guest’s stay has ended doesn’t mean your responsibility to them as a host ends. A good host knows that former guests who had an amazing Airbnb experience will likely come back and spread the word about their experience.
Guest retention does wonders in increasing occupancy rates. It is a lot easier and more cost-effective to retain guests than to draw new ones in. That being said, showing your guests that you remember them by checking up on them or sending them holiday or thank-you cards will make them feel special and valued.
8. Use Professional-Quality Photographs
Another key to boosting Airbnb occupancy rate is to use high-quality and professional-grade photos in your listings. Remember that a picture is worth a thousand words. Folks looking for short-term rental properties may or may not read the descriptions, but they most certainly look at pictures. In most cases, potential guests make decisions based on what they see and not what they read.
Since photos help generate plenty of business, it is wise to invest in a good photographer who can highlight your property’s best features and make them pop. Have them take exterior and interior photos. Highlight the bedrooms and bathrooms. Show them your special amenities like a jacuzzi or a pool if you have one. Make sure to update the photos on your listings every few years or after improvements are done. The point is that investing in good photos will get you good returns on your rental income.
9. Be Prepared for Different Seasons to increase Airbnb Occupancy Rate
Roll with the different seasons. If homeowners take time to decorate their homes according to the season, you should too. Guests appreciate rental properties that are appropriately decorated and updated for the season, whether it be Thanksgiving, Christmas, or New Year.
Investing less than a hundred dollars on your seasonal decorations can go a long way in the long run. Depending on the season, you can even throw in a bottle of champagne or a pie, and you’re sure to stand out. Take photos of the decorated property and update your listing a few weeks before getting holiday reservations. This will significantly increase your peak season bookings and reservations.
10. Work With a Good Team
Lastly, to improve your Airbnb occupancy rate, you need to have a good team to help you run and manage your property. This is especially helpful for out-of-state investors or those with multiple vacation rentals. The team they work with can help answer queries and address guest concerns on your behalf. Whether you hire someone to help run the daily operations or work with a property manager is up to you. The important thing is you have a team you can trust and count on to help optimize the process of renting the property out, including vacation rental marketing and maintenance.
Wrapping It Up
At the end of the day, merely owning or starting a short-term rental business is not a guarantee that you will earn a decent amount of money. Just like any business venture, investing in a vacation rental entails hard work. Boosting your Airbnb occupancy rate requires plenty of time, energy, and long hours of strategizing. It requires constant attention to your guests and listings. It is not just a one-time thing but a continuous process. Having a great occupancy rate regardless of the season ensures a faster return on your investment and better rental income. And with the tips above, you can achieve these results.
This guest post has been written by Alfred Lauzon, Content Writer at Mashvisor.
Author Bio: Alfred Lauzon has years of experience analyzing and writing about the US housing market. Currently, he’s working as Content Writer at Mashvisor, an industry-leading source of residential real estate data and analytics in the US market. We help investors find profitable long-term and Airbnb rental properties quickly and confidently.