Turning a Spare Space into Gold: Is Airbnb for You?

Airbnb is gaining enormous popularity among those who live in Australia and among those who travel throughout the nation. The service gives Australians a chance to rent out their home, granny flat or spare room to people travelling in the area who need a place to stay.

Guests may rent a room or home for one night or one week, depending on their travel plans. Either way, Airbnb makes finding a place to stay so much cheaper and easier than staying at a hotel.

For homeowners, listing their homes with Airbnb and similar services gives them a chance to make some extra money on the side. In fact, some homeowners actually make a second income from listing their room or home for rent on Airbnb.

Now, ever since New South Wales eased its regulations for renting property, there has been a huge boost in the Australian Airbnb marketplace. The demand has sparked additional competition in the marketplace. There are now more AirBnB property listings than ever before. 

But, before you start fixing up your rental property and listing it on Airbnb's website, you still need to be sure that you will be able to rent your property without any problems. Below are six considerations that you should investigate before going forward with the rental listing.

Legal Approval

Do not assume that short-term property leasing is legal in every state and city throughout Australia. For example, only 12 councils within New South Wales allow short-term property leasing and renting. 

Some councils don't have any provisions about the practice, while others have actually made it illegal to rent your home or property on a short-to-mid-term basis. Check with your local council and make sure you can legally rent out your property for a short-term period.

Certain states, like New South Wales and Western Australia, have eased a lot of these regulations to ensure they're more affordable housing on offer for rent.

Improvements

If you want to improve your property, you need to be sure that you can afford the project. It can cost thousands of dollars to redo your flooring, walls and ceilings.

Perhaps you’ll need to add a new room, engage your local plumbers or add other fixtures to the property, as well. Before you plan any improvements, first get your budget in order.

Location

Real estate is all about location. If your property is in a central location, then it will be more attractive to prospective tenants. 

For example, tourists travelling to a big city will not want to drive to the outback just to get a room. They will want their property to be close to the main tourist attractions and sites.

So, if your property is away from the main city area, try listing it for a longer stay period than one day. People who want to spend a week or month in a relaxing location may decide to rent a more secluded property. 

And if you’re in a less desirable location, you can stay competitive by adjusting your rates accordingly. 

Rental Space

If you have a small flat, apartment or house, you may not have the room to accommodate a guest. You need to be certain that you can offer a prospective tenant something worth renting. 

If you don’t have an adequate amount of space available, then perhaps you could build a granny flat or tiny home out the back if you have enough land acreage to do so.

These flats are very attractive to tenants because they are almost like little houses themselves and are separate from the main house.

Financing

If you do choose to build a granny flat, you need to be sure that you can obtain financing to pay for the job. Financial institutions usually won’t consider these secondary housing structures worthy of their own mortgages. 

Instead, a lending institution might offer a construction loan or let you use a home-equity loan to pay for the construction. A few credit unions even have an actual granny-flat loan option available.

Sharing

Finally, you need to mentally prepare yourself for the idea of sharing your property with a complete stranger. It is one thing to be a landlord who screens tenants for their investment property, but it is another thing to be living with your, tenant too. 

Renting out a room in a home that you are currently living in may make you feel uncomfortable. Just be sure you research the tenants on Airbnb by looking at their reviews and checking their listed references.