How much will you take for managing an Airbnb?

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How much will you take for managing an Airbnb?

Dolev Zaharony
Member since 2022 · 23 posts · 2 votes

Hello,

I have several Airbnb that I own and manage myself in the Raleigh, NC area. 

I was approached by a person who owns a great place for an Airbnb- a large cabin with a pool and pond on a 3-acre land with tons of potential. He is looking to move out of the place, turn it into an Airbnb and have me manage the whole thing. How much do you typically take for that out of the profit? The location is in Raleigh.

Thanks!

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John UnderwoodPro Member
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
3y

20 to 30%. I'd settle on 20%.

You might want to get insurance or at least get the person to add you to the property coverage in case you were specifically named in a law suit related to renting the property.

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  • Joel Case
    Rental Property Investor · Ocean Springs, MS · Member since 2022 · 349 posts · 301 votes
    3y
    Quote from @Dolev Zaharony:

    Hello,

    I have several Airbnb that I own and manage myself in the Raleigh, NC area. 

    I was approached by a person who owns a great place for an Airbnb- a large cabin with a pool and pond on a 3-acre land with tons of potential. He is looking to move out of the place, turn it into an Airbnb and have me manage the whole thing. How much do you typically take for that out of the profit? The location is in Raleigh.

    Thanks!


    STR management fees are generally 20-30%

    1Reply
  • Frank Barletta
    Rental Property Investor · New York, NY · Member since 2023 · 163 posts · 95 votes
    3y
    Quote from @Dolev Zaharony:

    Hello,

    I have several Airbnb that I own and manage myself in the Raleigh, NC area. 

    I was approached by a person who owns a great place for an Airbnb- a large cabin with a pool and pond on a 3-acre land with tons of potential. He is looking to move out of the place, turn it into an Airbnb and have me manage the whole thing. How much do you typically take for that out of the profit? The location is in Raleigh.

    Thanks!


    Take the % of Gross Receipts you feel would be worth managing on their behalf. 

    1Reply
  • Dave StokleyBusiness Member
    Property Manager · Cleveland, OH · Member since 2015 · 705 posts · 799 votes
    3y

    25%

    1Reply
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    3y

    20 to 30%. I'd settle on 20%.

    You might want to get insurance or at least get the person to add you to the property coverage in case you were specifically named in a law suit related to renting the property.

    3Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    25% is standard as a property manager. 15% for a co-host. If you are going to give yourself the title of a property manager, you may need to acquire a real estate license.

    1Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    3y

    Sounds like a wonderful opportunity! If you're handling the entire STR and the owner is doing nothing but receiving the monthly rents, I would definitely say you should get 25% of each booking/total monthly rents.

    Also, like mentioned already the owner should have you named as the additional insured manager of the property, as well as $1,000,000 in commercial Liability Insurance for the property. Make sure the owner gives you a certificate of insurance showing that you are listed as insured on the liability. You should also make sure the owner understands that the homeowners' insurance probably doesn't cover STR, and he should switch to Proper or Steadily Insurance. You should have business insurance as well, and Proper's sister company Wister might be a good option for you!

    Lastly it would be in your best interest to set up an LLC with a business name to run STR. Find out the correct way to operate an LLC and do it how your supposed to, then if something happens between the insurance and LLC you'll be protected.

    [email protected]330-557-3021
    1Reply
  • Pat LulewiczBusiness Member
    Realtor · Raleigh NC and Greensboro, NC · Member since 2019 · 396 posts · 392 votes
    3y

    I'm with @Frank Barletta and say it all the time to self-employed people...YOU MAKE YOUR OWN COSTS. Be the cheapest deal in town, avg, or high-end. Know your customer and each one will be different. Know your market, what the product is and how it compares to market supply (since you only make money when people book and pay). You can also be creative where you tier it so you both make more as the property books more. Many options. 

    1Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 3k+ posts · 3k+ votes
    3y

    We are full service and charge 20%-25% depending on the income potential of the property.  This is market dependent as well as full or limited service, etc.

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    0Reply
  • Dolev Zaharony
    OP
    Member since 2022 · 23 posts · 2 votes
    3y
    Quote from @Sarah Kensinger:

    Sounds like a wonderful opportunity! If you're handling the entire STR and the owner is doing nothing but receiving the monthly rents, I would definitely say you should get 25% of each booking/total monthly rents.

    Also, like mentioned already the owner should have you named as the additional insured manager of the property, as well as $1,000,000 in commercial Liability Insurance for the property. Make sure the owner gives you a certificate of insurance showing that you are listed as insured on the liability. You should also make sure the owner understands that the homeowners' insurance probably doesn't cover STR, and he should switch to Proper or Steadily Insurance. You should have business insurance as well, and Proper's sister company Wister might be a good option for you!

    Lastly it would be in your best interest to set up an LLC with a business name to run STR. Find out the correct way to operate an LLC and do it how your supposed to, then if something happens between the insurance and LLC you'll be protected.


    Thanks Sarah! I actually have an LLC for my business, but do you think I should get another one for managing this one? I dod not have a property manager license.

    0Reply
  • Dolev Zaharony
    OP
    Member since 2022 · 23 posts · 2 votes
    3y

    Thanks everyone for your input!

    0Reply
  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    3y

    I’d say 20 percent and no junk fees other than reasonable fees pertaining to the booking (like credit card processing). I see so many people offering 20-25 percent and then they add in “fees” which are not shared with the home owner. PMs use these extra fees to cover their overhead and take in 20-25 percent as their “profit”. In many cases this brings it up to 40 percent cost to the homeowner. Clever marketing, but sleight of hand. 

    1Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    3y
    Quote from @Dolev Zaharony:
    Quote from @Sarah Kensinger:

    Sounds like a wonderful opportunity! If you're handling the entire STR and the owner is doing nothing but receiving the monthly rents, I would definitely say you should get 25% of each booking/total monthly rents.

    Also, like mentioned already the owner should have you named as the additional insured manager of the property, as well as $1,000,000 in commercial Liability Insurance for the property. Make sure the owner gives you a certificate of insurance showing that you are listed as insured on the liability. You should also make sure the owner understands that the homeowners' insurance probably doesn't cover STR, and he should switch to Proper or Steadily Insurance. You should have business insurance as well, and Proper's sister company Wister might be a good option for you!

    Lastly it would be in your best interest to set up an LLC with a business name to run STR. Find out the correct way to operate an LLC and do it how your supposed to, then if something happens between the insurance and LLC you'll be protected.


    Thanks Sarah! I actually have an LLC for my business, but do you think I should get another one for managing this one? I dod not have a property manager license.

    What business do you have, would this be your personal STR?
    [email protected]330-557-3021
    0Reply
  • Luka Milicevic
    Real Estate Agent · Nashville, TN · Member since 2015 · 2k+ posts · 2k+ votes
    3y

    In my market it's 18-20%

    0Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y

    Hey @Dolev Zaharony, great answers here for you. I will say that if you are charging 25%, you are responsible for paying the cleaners and minor maintenance stuff so make sure you budget that.

    1Reply
  • John Carbone
    Realtor · Gatlinburg · Member since 2020 · 1k+ posts · 957 votes
    3y
    Quote from @Michael Baum:

    Hey @Dolev Zaharony, great answers here for you. I will say that if you are charging 25%, you are responsible for paying the cleaners and minor maintenance stuff so make sure you budget that.

    I didn’t think cleaning fees were paid by the PM….is that common?
    0Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    3y
    Quote from @John Carbone:
    Quote from @Michael Baum:

    Hey @Dolev Zaharony, great answers here for you. I will say that if you are charging 25%, you are responsible for paying the cleaners and minor maintenance stuff so make sure you budget that.

    I didn’t think cleaning fees were paid by the PM….is that common?
    No, we don't pay the cleaning fees, the guest does. Although some places wrap the cleaning fee into the nightly rate.
    [email protected]330-557-3021
    0Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y

    So every PM that I have talked with includes the cleaning fee and up to a certain amount of general maintenance and repairs in their fee.

    I guess each and every PM would be different. @Dave Stokley?

    0Reply
  • Dave StokleyBusiness Member
    Property Manager · Cleveland, OH · Member since 2015 · 705 posts · 799 votes
    3y
    Quote from @Michael Baum:

    So every PM that I have talked with includes the cleaning fee and up to a certain amount of general maintenance and repairs in their fee.

    I guess each and every PM would be different. @Dave Stokley?

    Cleaning fees are billed back to guests. We cover the cost of quarterly deep cleans.

    We cover basic preventative maintenance like changing furnace filters and smoke detector batteries. Everything else is billed back at cost. We do the work of coordinating it.

    2Reply
  • Mark S.
    Real Estate Investor · Saint Paul, MN · Member since 2017 · 543 posts · 475 votes
    3y

    @Sarah Kensinger I think it’s a bit misleading to say that the “guest pays the cleaning fee“, even though that seems to be what everyone likes to say. Whoever owns or manages, the property pays the cleaners. Yes, you generally add a cleaning fee to your charges that may or may not be exactly what the cleaner is charging you as the owner. But in terms of the actual management of a property, the owner or PM pays the cleaners. Some owners don’t charge a separate cleaning fee, some charge more than the cleaners bill thwm, to cover incidentals, and some charge a little bit less to make their listing look more attractive. So it’s not a straight “pass-through“. 

    1Reply
  • Nathan FaseltBusiness Member
    Rental Property Investor · Iowa City, IA · Member since 2019 · 94 posts · 35 votes
    3y

    We have implemented a billing structure for short-term rentals that ensures transparency and aligns our interests with yours as the property owner. Our approach involves a fixed fee that covers approximately 15-18% of the estimated income, excluding cleaning charges. Beyond that threshold, we apply a fee of 20%.

    Let's consider a simple example: If your property has an estimated monthly income of $1000, we would deduct a fixed fee of $150 from that amount. For any income generated beyond that, our fee would be 20%. This billing structure allows us to cover our main operational costs while also providing an incentive for us to exceed the agreed-upon gross income goals. We would also bill cleaning to the residents and the maintenance to the property owners.  

    0Reply
  • Dolev Zaharony
    OP
    Member since 2022 · 23 posts · 2 votes
    3y
    Quote from @Sarah Kensinger:
    Quote from @Dolev Zaharony:
    Quote from @Sarah Kensinger:

    Sounds like a wonderful opportunity! If you're handling the entire STR and the owner is doing nothing but receiving the monthly rents, I would definitely say you should get 25% of each booking/total monthly rents.

    Also, like mentioned already the owner should have you named as the additional insured manager of the property, as well as $1,000,000 in commercial Liability Insurance for the property. Make sure the owner gives you a certificate of insurance showing that you are listed as insured on the liability. You should also make sure the owner understands that the homeowners' insurance probably doesn't cover STR, and he should switch to Proper or Steadily Insurance. You should have business insurance as well, and Proper's sister company Wister might be a good option for you!

    Lastly it would be in your best interest to set up an LLC with a business name to run STR. Find out the correct way to operate an LLC and do it how your supposed to, then if something happens between the insurance and LLC you'll be protected.


    Thanks Sarah! I actually have an LLC for my business, but do you think I should get another one for managing this one? I dod not have a property manager license.

    What business do you have, would this be your personal STR?

     Relocation specialists- short to mid-term rentals. 

    nctriangleconnection.com

    0Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    3y
    Quote from @Dolev Zaharony:
    Quote from @Sarah Kensinger:
    Quote from @Dolev Zaharony:
    Quote from @Sarah Kensinger:

    Sounds like a wonderful opportunity! If you're handling the entire STR and the owner is doing nothing but receiving the monthly rents, I would definitely say you should get 25% of each booking/total monthly rents.

    Also, like mentioned already the owner should have you named as the additional insured manager of the property, as well as $1,000,000 in commercial Liability Insurance for the property. Make sure the owner gives you a certificate of insurance showing that you are listed as insured on the liability. You should also make sure the owner understands that the homeowners' insurance probably doesn't cover STR, and he should switch to Proper or Steadily Insurance. You should have business insurance as well, and Proper's sister company Wister might be a good option for you!

    Lastly it would be in your best interest to set up an LLC with a business name to run STR. Find out the correct way to operate an LLC and do it how your supposed to, then if something happens between the insurance and LLC you'll be protected.


    Thanks Sarah! I actually have an LLC for my business, but do you think I should get another one for managing this one? I dod not have a property manager license.

    What business do you have, would this be your personal STR?

     Relocation specialists- short to mid-term rentals. 

    nctriangleconnection.com

    It looks like you manage MTR? If so, then yes, I would just use the same LLC to manage STR. 
    [email protected]330-557-3021
    0Reply
  • Sarah KensingerPro Member
    Real Estate Consultant · OH · Member since 2023 · 2k+ posts · 1k+ votes
    3y
    Quote from @Mark S.:

    @Sarah Kensinger I think it’s a bit misleading to say that the “guest pays the cleaning fee“, even though that seems to be what everyone likes to say. Whoever owns or manages, the property pays the cleaners. Yes, you generally add a cleaning fee to your charges that may or may not be exactly what the cleaner is charging you as the owner. But in terms of the actual management of a property, the owner or PM pays the cleaners. Some owners don’t charge a separate cleaning fee, some charge more than the cleaners bill thwm, to cover incidentals, and some charge a little bit less to make their listing look more attractive. So it’s not a straight “pass-through“. 

    I suppose it's a matter of perspective. But since the booking sites lumps all the profits....nightly rent, cleanings, etc......together, it would be the host's responsibility to pay the cleaner. I know some people tack on extra to cushion the cost of supplies or even profit, but I'm not a fan of that. Every property we underwrite has supplies listed as an expense that would come out to of the gross profit. But again, due to the way the booking sites are set up, whoever holds the account that all the profits are deposited into has the responsibility of paying the cleaner.
    [email protected]330-557-3021
    0Reply
  • John MorganPro Member
    Rental Property Investor · Grand Prairie, TX · Member since 2018 · 2k+ posts · 2k+ votes
    3y

    @Dolev Zaharony

    I pay 30% in Branson.

    0Reply
  • David Dachtera
    Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes
    3y

    My personal preference for managing an STR or MTR would be someone / a team with hospitality experience, preferably an actual B&B or hotel / motel experience. It's a whole different "ball of wax" from managing LTRs.

    My$0.02 ...

    0Reply
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