AIR DNA Calculator: How accurate is this in your experience?

Question

Good morning, I'm new to Bigger Pockets and am currently looking to purchase my first Air BNB. I'd like to post two questions.

1. One tool I've started using on AIR DNA is the "Rentalizer" and I'm seeking feedback from others that have used this tool. How accurate has your experience been with this tool? The cap rate and NOI calculations seem to be generous.

2. On the Rentalizer tool, the NOI and Cap Rate actually increase when I lower the number of guests from 10 to 4, I'm curious why this would be the case, and how this is being calculated.

Bruce Woodruff · Answer

You need to do your own research by going on those sites and pulling numbers from very similar properties. The computer is just guessing......you will get real numbers by doing it yourself.

Karl McGarvey · Answer

I use the rentalizer as one of my resources for income research here in Galveston and it is usually pretty close to what I can make in year two. First year the property will make a little less as you try to build up reviews etc.

Rentalizer is pulling data from other properties based on the criteria you put in. If properties with 4 guests make more than 10, that is what it is telling you. Keep in mind that properties that can only have four guests are probably smaller and cheaper which could create easier potential for a higher cap rate/NOI.

Don't lean just on AirDNA for your data. You need to back it up with supplemental data from Airbnb/VRBO. Dig into the sites and look at your competition to see who is booking for what prices, where they are located, and how they are furnished to get those rates.

Evan Floyd · Answer

@Michael Baum @Bruce Woodruff @Karl McGarvey Great feedback from each of you! Thanks for chiming in. :)

Michael Baum · Answer

Hey @Evan Floyd, welcome to the forum. I have found that AirDNA is really hit or miss. Like any algorithm, you get out of it what you put in. The more data points, the more accurate you will be.

In my case, when I ran our property through AirDNA, it came out about 2/3'rds more in the nightly rate than the actual one we charge. AirDNA lumped in some out of range homes, $2500 a night huge log cabins etc in with our 2700sqft lake house.

I believe it is a resource but do your own research. Go out and look at homes like yours, check the nightly rates, occupancy, amenities etc. Then plan accordingly.

Check out the Enemy Method - https://www.biggerpockets.com/...

AIR DNA Calculator: How accurate is this in your experience?

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