What you need to know before renting your home on Airbnb

There are still lots of people planning their summer holiday breaks and looking for accommodation, so now could be the perfect time to consider listing your home on Airbnb.

The big advantage of Airbnb is that you can also choose your own guests by looking at how other hosts have reviewed your applicants on how well – or badly – they behave.

“Whether it is a spare room, your family home when you are on holidays or a treehouse, it is free and easy to create a listing,” says Sam McDonagh, Airbnb country manager for Australia and New Zealand.

“People are turning to Airbnb to take typically their biggest asset, their own home, and turn it into extra income. The average Australian Airbnb host earns a modest $5600 a year in income, which we know helps pay the mortgage, pay the bills or even fund their family holiday.”

What Airbnb hosts need to consider

A major consideration is whether you’re going to be around when your guests arrive, or if you’re going to be away and letting out your whole home.

If you’re in an apartment, it’s important to check your body corporate rules which may not allow you to rent out your whole apartment when you’re away.

As with all real estate, your photos will sell the idea of your home as a great place to stay, so make sure your images are as inviting as possible. Your description should be clear and comprehensive, including the number of people you can have to stay, whether or not you welcome children, and if you will be providing breakfast.

Airbnb has a competitive pricing tool to help you set the right price or you can work it out yourself on the popularity – or otherwise – of your home among potential visitors.

Hosts should also declare the money they’ve made to the Australian Tax Office, with officers warning they’ll be clamping down in 2018 on anyone not declaring their income.

• Related: Australia’s top Airbnb host makes $5.3 million per year
• Related: Inner-city Sydney residents largely in favour of Airbnb
• Related: Why I’m falling out of love with Airbnb

Homeowners need to be aware that by renting their home on Airbnb, they will become liable for capital gains tax when it comes time to sell, calculated on the proportion of the floor area rented and period it was used for that purpose.

What to do before your guests arrive

Work out a system for either giving your guests a key, emailing them with a door code or making sure you’re home every time they come back.

There are many other subsidiary services available today like madecomfy.com.au or airbnbhandsfree.com.au to make such arrangements more convenient, as well as changing sheets and towels and cleaning between guests.

Make sure you lock your valuables away for safety. Many people have a lockable cupboard or close off one room to store anything precious. Check your insurance is up to date – just in case. Airbnb do insure you for accidental damage or if a guest is injured, but it’s always good to have your own insurance too.

Most importantly, make sure the room or your home is clean, tidy and free of unnecessary clutter, particularly if your guests will be sharing a bathroom with you.

Ursula’s $6000 spare room

Sydney nurse Ursula Irish has been renting out the spare rooms of her home in Miranda for the past four to five years, and some years has made as much as $6000.

“It varies according to whether or not my children are boomeranging home which means then I don’t rent out both rooms,” she says. “But that’s what I like so much about it; that it’s so flexible and you choose your own dates that you want to accept guests.”

Irish, 60, is currently renting out one room, her ‘yellow room‘, for $60 a night and prepared for Airbnb by buying new beds, linen and towels.

She leaves coffee, tea, milk, cereal and eggs and bacon for her guests as a welcome pack to make their own breakfast.

She has the advantage too of having her spare room in a separate part of the house, as an attached garden flat with its own bathroom, kitchen and deck.

“It’s much better if there is an ensuite in a spare room,” she says. “I’ve found guests really like that, and it’s much less disruptive for the rest of the household.”

“I also like the way Airbnb gives you a statement of annual earnings which makes it easier for tax,” says Ms Irish, who decided to rent out on Airbnb after staying in them on her own travels. “And I’ve really enjoyed meeting people from around Australia, and the world.”