Research has shown that Australians are increasingly choosing rented houses or serviced apartments when staying in Australian capital cities. Figures released by Roy Morgan showed that, in the year to March 2018, 10.4 per cent of travellers used this type of accommodation, compared to 7.1 per cent 10 years ago.
However, not everyone’s happy about it. In a statement, Gary Morgan, executive chairman at Roy Morgan, claims apartments are being used (and vandalised) by travellers, leading to reduced values.
For others, though, running Airbnb-style accommodation is pleasurable and profitable. This is the case for Len West, whose business – Airbnb Manager – looks after 10 properties on the Sunshine Coast. The worst case of “vandalism” he’s seen is a red wine spill. In contrast, when he owned permanent rentals, one set of tenants lit a fire on the living room floor and left an axe embedded in the fridge.
To protect the properties he manages, West has strict rules. The most important thing, he says, is selecting your booking site. He likens it to choosing a dating site – rather than putting your profile on all of them, select one that will attract your type of person. For West, that site is Airbnb, because they verify who is booking, and “stand behind what they say”.
Also important is taking a bond, West says. “The more expensive the property, the more expensive the bond.” With the red wine spill, the bond covered the carpet cleaning. On Airbnb, a bond isn’t required on set up. To add one, edit your profile, and look for “security deposit” in the pricing area.
If you have a larger home, West recommends only taking multi-night bookings. “If people are going to have a party and create havoc, they don’t tend to book two or three nights,” he says. “They book one night [for] maximum fun and then they’re gone.” This isn’t usually a problem for apartments, where big parties are less likely.
About parties, West recommends you should always check dates when taking bookings. That way, you can be careful at times of year like schoolies. He also recommends having clear house rules. All the properties he manages have a no pets, no smoking and no events policy, which guests are reminded of in a pre-arrival text and handbook on the property.
West also checks feedback from other hosts before accepting guests. “If you’re going to buy a new washing machine you go and look it up,” he says. “As the manager or owner of a property, you look at … feedback from all the people.”
Careful checking of profiles and references tells you a lot about people, agrees Nannette Holliday, a freelance writer and author who has run Airbnb accommodation since 2009 in Canberra, Melbourne and Darwin.
Holliday, who has never had guests damage her apartments, refuses to get instant book and ensures all her guests are greeted personally. When she rented out her whole Melbourne apartment, and couldn’t personally meet her guests, she paid a friend to greet them.
Holliday says that avoiding problems starts with choosing the right apartment. She recommends investing in quality accommodation in sought-after areas, to ensure you get plenty of interest. She bought in Melbourne’s Docklands. “I had the top floor unit – commanding views, beautiful setup,” she says. “It was a two-bedroom, two-bathroom apartment. That was the minimum that I wanted, because my whole idea was to rent out the other bedroom … on Airbnb.”
If top-floor, inner city is beyond your budget, don’t despair. Making sure your accommodation is nicely furnished and well-equipped helps to attract quality guests, Holliday says. Hers have their own bathroom, and a nicely furnished room with desk, TV and DVD player.
Pricing will also affect the type of people you attract. Holliday recommends ignoring recommendations from Airbnb to reduce your price. “There’s a pressure from Airbnb to make money,” she says. “If I haven’t had a booking for a while, they send you these automated emails that say … other people are booking in your area, you need to drop your price.”
Instead, Holliday advises you should know your market, and adjust your rates accordingly. “Airbnb put up a thing saying this is what we think you should rent your place for,” she says. “Often, it’s a lot less than what you can actually get.” In Melbourne, for example, you can charge more during events like the Australian Open.
Just in case the worst happens, have a back-up plan. West says you must advise your insurance company that you’re running an Airbnb, and make sure it doesn’t exclude you from coverage. Getting landlord insurance is another safeguard. “For a couple of hundred dollars, if someone ran amok with a fire hose or axe or something … your [house] insurance might not cover you but … landlord insurance would.”