Pricing 101: How Does Your Vacation Rental Stack Up in the Market?

Pricing 101: How Does Your Vacation Rental Stack Up in the Market?

admin Articles, Blog , , , , , , , , , , , ,


Hi everyone. Scott Shatford here, CEO of AirDNA. Today we’re going to cover how does your property
stack up? You’ve got a vacation rental. You know, is it doing great? Is it doing awful? Where do you really stack up against the competition? We have a few different tools that we offer
at AirDNA within the MarketMinder product that help you really analyze how well are
you really doing. The first thing I’m going to go over is Rentalizer. Rentalizer is the tool where you can type
in any address in the entire world, and we will estimate what it will earn as a full-time
vacation rental. It’s the first AVM, automated valuation model,
really ever created for the short-term rental market. So we typed in 1300 East 7th Street in Denver,
Colorado. Five bedroom, six bath property and we’re
looking at how much this property is going to earn over the next year. Big numbers! One hundred eighty thousand dollars per year
is what our estimates are for this, for this neighborhood, for this property. Now, how we getting to that number? How we getting to the monthly estimates of
this property earning sixteen thousand dollars a month, you know, average daily rate of near a
thousand dollars? You know, we’re doing it through comps. The way we think about comps is we pull in,
via proximity, via bedrooms and bathrooms, you know, what are the most relevant properties
in your area that are the most active Airbnb vacation rental properties in the marketplace? So you can see here the comps that we pulled
up for this address. We have a, you know, five million dollar country
club estate doing one hundred forty two thousand dollars in revenue. We have another property, you know, a mansion
doing two hundred thirty five thousand dollars a year in revenue. These are big numbers. So let’s dissect this a little bit and kind
of understand how we’re coming to these numbers, how we’re coming to these projections. So what we’re talking about here is revenue. Revenue’s actually what we estimate this property
is going to do over the next year. Revenue potential is what we’re estimating
it would do if it was available as a full time rental, because not every property is
available all the time. Sometimes they are owner-occupied half the
year, seasonal rentals or otherwise. A lot of what our science is doing is understanding
what this property would do and will do as a full time vacation rental property. So it’s really interesting to look at each
of these comps. Understand, you know, how good, how nice the
properties are, how big the properties are, how well they’re managed, how well they’re
designed, how well they’re really being priced to really understand exactly what your underlying
property should be earning. If you want to take a step back and think
about the overall market in general, you can go to our Top Properties section. The Top Properties section is where you can
put in any sorts of filters for, you know, five to six bedroom properties in a different
market in Denver. And what are the best performing properties
in the entire city? So looking here in all of Denver, five plus
bedroom properties, you know, this property is doing two hundred fifty thousand dollars
a year in revenue. So the other way to think about how you stack
up is to kind of back into what are the best people doing and how are you doing? You can dive into these listings and then
say, you know, why is this property doing so much better? Is it just because it’s a five million dollar
home or is it because they are advertising better? Is it because they have better furnishings
or better pictures? You know, oftentimes when I’m looking at listings
I’m not looking at listings doing great because the underlying value of the asset is that
much better. It’s because they’re marketing better, pricing
better, decorating better, and really just speaking to the experience this property’s
going to offer. Oftentimes I like to say that it’s best to
be a fast follower and not an innovator in your space. There’s hundreds of thousands of people out
there that’ve tried to perfect the model, and oftentimes thinking about the people are
doing it best right now, emulating what they’re doing is the easiest way to kind of make great
revenue on Airbnb. So those were a couple little tidbits of knowledge
on how to use Top Properties, how to use Rentalizer to one, benchmark the performance of your
property, but also analyze what would be the estimated returns on a new vacation rental
property.

You May Also Like..

Cruising for Introverts and Carnival’s PVP – Vlog

Cruising for Introverts and Carnival’s PVP – Vlog

And action! And action. hey cruisers welcome to our weekly vlog thank you very much son for getting us started […]

Disney Fantasy Cruise Ship Tour – Disney Cruise Line

Disney Fantasy Cruise Ship Tour – Disney Cruise Line

The Disney Cruise Line’s ship, the Disney Fantasy, arrived in New York on Feb. 28, 2012 after sailing across the […]

4 Comments

  1. These recent video have been excellent. Really appreciate the concise but informative thoughts and the conclusions that you make when utilising the comprehensive data available in AirDNA. Makes me realise how essential this data is if you want to raise your AirBnB business to the next level.

  2. Air DNA is getting better as they incorporate more data into their system. Our firm specializes in the valuation of local short term rental properties so we have a substantial amount of data. This tool isn't perfect in our area since Air BnB isn't the preferred site. Having said that, it has more data and information than I have seen assimilated in any one place. Definitely worth the $40 bucks. Thanks Scott.

Leave a Reply

Your email address will not be published. Required fields are marked *