Preparing to List: How Can You Estimate a Short-Term Rental’s Earnings?

Hello, and welcome to Snowball Rentals’ WeChat account, where you can read about recent developments in the US short-term rental market.

After all our time operating short-term rentals, the first question homeowners most often ask when approaching Snowball Rentals is:

If I convert my property to a short-term rental, roughly how much can it earn?

If we happen to operate a short-term rental nearby, comparison and analysis make this question easy to answer.

But what if we do not operate a short-term rental nearby, or the homeowner simply wants to look into it themselves?

Today, I will openly share the short-term rental income estimation website we use most, along with instructions and points homeowners should watch out for.

First, let me introduce the website: AirDNA.

There are several similar websites, but AirDNA was among the earliest, is one of the best known and is relatively accurate.

A few years ago, homeowners had to pay to estimate short-term rental income on AirDNA: at least a few dozen dollars each time, or over US$100 for a wider area.

But as more similar websites attracted visitors with free offerings, AirDNA also began offering a free model this year.

Homeowners can visit the website, enter their rental property's address and obtain a free estimate of its rental income if converted to a short-term rental.

You can also see estimated monthly rental income reflecting peak and off-season changes, estimated occupancy and the average nightly rate.

Most importantly, you can see similar properties nearby and their short-term rental income! AirDNA bases its estimate for your property on these comparable listings.

If your property looks better than theirs, you may be able to earn more. If it is less attractive, your rental income will also be lower.

But do not assume one website solves everything. Here is our guide to when AirDNA is particularly useful and when it can be completely inaccurate.

AirDNA's underlying method uses nearby comparable listings to estimate income, so:

1. The more short-term rentals there are around your downtown property, the larger the data sample and the more accurate the assessment. If you own a detached suburban house with few short-term rentals nearby, the sample is insufficient and AirDNA's estimate has no useful reference value.

2. AirDNA only asks for bedroom and bathroom counts and guest capacity, without further distinctions. If your house has a swimming pool, a hot tub, a waterfront location, lake or mountain views, or brand-new modern architecture, AirDNA will underestimate its short-term rental income because it does not factor these features in.

3. A few years ago, AirDNA's estimates were mainly based on the average performance of nearby short-term rentals. Over the past year or two, perhaps because of a difficult broader environment, AirDNA has shown more of the best-performing nearby listings to make short-term rental income look higher. So do not feel too discouraged if your income is below theirs.

Those are three examples of AirDNA being insufficiently accurate. Now let us look at how to obtain precise data from it.

Do not look only at the estimated number. Ideally, open each comparable listing and compare it: first its distance from you, then its condition, age, furnishings, appearance and rating. If you can find two or three similar properties nearby and are confident you can achieve equally high ratings, those rental income estimates are accurate.

Of course, if you are a new host without short-term rental experience, there is a strong chance you will not achieve AirDNA's estimated income.

If you want to know how much your rental home could earn from short-term rentals, contact us. We can research and discuss it together.

These properties offer lower profits, maintenance quality and control. Their advantage is that long-term rentals are less selective: there is no house that cannot rent, only a price at which it cannot rent.

As a homeowner, you may now be wondering: my home is quite good, but how much could it earn on Airbnb? Would it earn more than a long-term rental? Would it involve a lot of trouble?

Contact us right away! We will evaluate it for you free of charge.

If you:

Hope to increase rental income through short-term rentals;

Cannot spare a great deal of time to handle the small details;

Occasionally need to use the home yourself, making it unsuitable to empty out the furniture for a long-term rental;

Then:

Snowball Rentals’ management team is your best choice.

From pre-launch vacation-rental styling, big-data analysis and online marketing to tenant screening, dynamic pricing, customer service and sales, cleaning and repairs, Snowball Rentals provides everything as one complete service for your home.

This Week’s Booking Results

Through long-standing relationships with insurers, assignment companies and technology companies, Snowball Rentals rents homes for medium- and long-term durations at short-term rates, then gives owners a rebate of 5% in management fees to maximize their income.

Winter is the low season for Seattle’s short-term rental market, especially in 2023. Some recent large bookings, however, have been like a ray of sunshine, giving us high hopes for Airbnb’s performance this summer!

The detached house below, located in Seattle, has an estimated long-term monthly rent of approximately $3200, which can be looked up on REDFIN.

This is a brand-new house. The owner placed great trust in the Snowball Rentals team and commissioned us to furnish it immediately after buying it, then put it straight into short-term rental operation.

Fortunately, it received a large booking shortly after listing!

As shown in the booking screenshot below, a guest rented through Airbnb for 23 nights.

The rental income plus cleaning fee for this booking reached $8213.86!

Converted to a month of 30 nights, the rental income is approximately $10700.

In summary, with Snowball Rentals operating this house, monthly rental revenue rose from $3200 for a long-term rental to $10700—more than

three times as much.

More importantly, the owner does not have to worry about maintenance or cleaning. When something needs to be discussed with guests, we also help with communication and oversight.

Here, we again thank the owner for placing trust in the Snowball Rentals team!

After Airbnb’s downturn in 2023, we at Snowball Rentals hope to help owners regain ground in summer 2024!

Once again, heartfelt thanks to our homeowners for their trust and support. Whether the market is strong or weak, Snowball Rentals will stand with you and look for ways to increase your income!

Some homeowners will surely ask the hard question: was a large booking like this just a stroke of luck? What if the home does not rent? A long-term rental is more stable—even earning less is better than earning nothing!

Our answer is: the outcome depends on what we do.

Vacation-Rental Styling

Competition on Airbnb is becoming increasingly intense. The days of piecing together secondhand furniture, taking phone photos and earning easy money on Airbnb are over. Airbnb hosts have moved toward professional operations.

Careful design and furnishing before launch, followed by professional short-term rental operations, will be the only choice for a rental that continues to generate high income.

Here is another of Snowball Rentals’ core services: vacation-rental styling!

Using the home above as an example, let us look together at its appearance after furnishing:

When choosing a short-term rental on Airbnb, would this home’s appearance attract you?

If you would also like to make your home more attractive and earn more rent, please contact us at any time!

This Week’s Short Videos

We regularly update short videos every week.

The content you need is all here.

👇🏻 Homeowners are welcome to follow us 👇🏻

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We also share practical vacation-rental styling plans and creative ideas to help you achieve more with less spending!

Keep rental income growing!

Xiao An’s Vacation-Rental Styling

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Referral Rewards

If you are already a Snowball Rentals homeowner, you receive a US$500 referral fee for each referral.

If you are not yet a Snowball Rentals homeowner, you receive a US$250 shopping voucher for each referral.

Snowball Rentals Management

1. Full service — We provide pre-launch rental design, furniture procurement, furnishing, professional photography, online marketing, copywriting, tenant service and sales, cleaning, supply purchasing and property repairs. You only need to be a hands-off owner; we handle the rest.

2. Multi-platform promotion — We promote the home on Airbnb, VRBO, HomeAway and other mainstream platforms for maximum exposure.

3. Dynamic pricing — Using big data, we adjust prices every day according to seasonal demand, holidays, last-minute vacancy offers, weekends and local activities, maximizing the owner’s income.

4. Income-improvement SOP — We follow 44 secrets for maximizing short-term rental income, optimizing each property’s online marketing, on-site operations and other aspects to work toward maximum income.

5. Flexible owner stays — Owners can flexibly choose when to stay themselves. This is especially suitable for owners with multiple residences around the world.

6. Terminate at any time — Management does not require an annual commitment. The owner can end the agreement with one month’s advance notice.

7. Corporate housing — In addition to nightly rentals, we work with insurers and assignment companies to provide executives with hotel-style managed accommodation for stays longer than 30 days.

8. Transparent fees — For rentals longer than 30 days, we charge 15% of accommodation revenue. For nightly rentals under 30 days, we charge 20% of accommodation revenue.