The Weston Creek Airbnb that's making its owners a hefty profit

When Ben and Dani Potter started operating a short-term rental out of their Waramanga investment property, they expected guests but were surprised at just how high the demand was.

The two had installed a second dwelling at the back of the property a few years ago, and used it as a display home for their building and installation businesses.

But three months ago they started renting it out on Airbnb, and ever since they have rarely had a vacancy. Even after the end of the summer holiday period, the home has remained consistently booked

“The holidays were a bonus but now school has gone back we were interested whether it would keep filling up, and it did,” Mrs Potter said.

“Every day we get someone, for either far in advance or just for the coming weekend.”

According to Airbnb, in 2018 the number of inbound guest arrivals using the service in Canberra was 87,600 – a year-on-year growth of 63 per cent.

“In 2018, our community in the ACT grew strongly with more local families and small businesses benefitting from the opportunities created by home sharing,” said Airbnb Australia country manager Sam McDonagh.

“We expect this strong growth to continue in 2019.”

Airbnb guests are vetted through a star rating system, while traditional long-term tenants are normally subject to a much more thorough selection process, but the Potters trust the system works.

“At the end of the day [if they do anything bad] it’s going to affect their rating because we’ll go on their public profile and say, ‘Don’t have these guys’,” Mrs Potter said.

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She said the upkeep on the short-term rental is minimal. She doesn’t meet guests and it takes roughly one hour to clean, which she normally does most days at lunchtime.

So far, the couple has made close to $4000 per month and can make anywhere between $184 to $236 per night depending on demand.

If it was used as a long-term rental, Luton Properties Woden agent Ryan Thomas said it would make between $450 to $500 per week.

Domain senior research analyst Nicola Powell said it was a “no-brainer” for some investors to consider the short-term rental market, particularly those who had a second dwelling such as a granny flat.  

“Given the increased rates in Canberra, investors are much more likely to look at higher yielding options and, for some, short-term leasing can off that higher yielding option,” Dr Powell said.

But the success of the Potters’ Airbnb is an outlier in Canberra’s short-term rental market.

Information sourced from Airbnb put the number of active listings in the Canberra market at 1400 and the typical annual takings for individual hosts is $8800.

“The typical Airbnb host in the ACT earned an extra $160 a week in income,” said Mr McDonagh.

According to Domain data, the median weekly asking rent in Canberra for a house is $560 and for units, it’s $465 – $29,120 and $24,180 per annum, respectively.

House sharing where a guest rents a room, compared to an entire apartment, is far more common in Canberra.

Research from SGS Economics and Planning last year found it was not financially beneficial for most investors to opt for the short-term rental market over the long-term rental market.

For the Potters, they believe their success stems from a range of factors, but mostly attribute it to the fact their listing can host six people.

“Six people have to split into two rooms in a motel but in this, you can comfortably sleep everyone,” said Mrs Potter.

Mr and Mrs Potter currently have their Waramanga property on the market, giving curious investors the opportunity to dip their toes in an already successful short-term rental investment. The front dwelling on the property also has a long-term tenant who would like to stay on.

“It’s pretty interesting to see the number of people who are looking at it for an investment,” said Mr Thomas.

It is unclear what the impact of Canberra’s short-term accommodation market is having on the tight long term rental market, but signs suggest its minimal.

Domain puts Canberra’s vacancy rate at one per cent but, according to Airbnb, the number of vacant homes in Canberra outweighs the number of listings on the service. 

“When you are looking at an individual room, that really doesn’t affect the long-term leasing market but standalone dwellings do take away from the pool of stock,” added Dr Powell.

1 Manu Place

Waramanga

5 bedroom, 3 bathroom

Auction: 1pm, Saturday March 16