Tustin, CA · Member since 2017 · 57 posts · 14 votes
I'm looking at properties in the Oceanside CA area and hoping to make it an Airbnb. According to the calculator, I could make $1,400 a week. Am I missing something? That seems crazy high but if it's accurate, i'm buying!
Thanks
Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes
8y
Just plugged in all four of my properties, and the estimates were wrong on all of them. Too high for my Pigeon Forge cabins that sleep up to 4, and much too low for my CA house that sleeps 6. It's always tricky for calculators like these to function well, because the solid information is not readily available, so the algorithm has to do a certain amount of guessing. And you never know how "smart" the algorithm is!
Another thing is we don't know what kind of data points it's pulling from... is it looking at nightly prices, or is it looking at the full booking cost (including AirBNB's booking fee)? The Pigeon Forge estimates would be pretty close IF they're looking at the "out the door" cost to renters - including tax, booking fee, etc. But that's not terribly useful to me as I care more about what I can set my nightly rate at; I don't want to reverse engineer the math to extrapolate what the property owner is charging, if in fact that's how the number is calculated.
Do some old-fashioned research, don't let this calculator get too excited. :) And research the local laws!!! Oceanside may very well have regulations limiting or forbidding short-term rentals, you want to know that before you buy. :)
Rental Property Investor · Providence, RI · Member since 2013 · 120 posts · 41 votes
8y
@Jacob Prelle definitely need more information here...which calculator are you using? Can you give details of the numbers? Then people here will be able to tell you if it makes sense or not.
Investor · Roseville, CA · Member since 2016 · 893 posts · 1k+ votes
8y
@Jacob Prelle That sounds like a high 'gross' number. It's likely just taking ADR (average daily rate) and multiplying it by 365 days * Occupancy Rate. STR's run a very high Op Ex ratio so using gross revenue number is really only useful when comparing markets to one another as a high level place to start.
It's telling me $1540/week for one of my properties which is only what I would make in peak season (gross).
Reach out if you have any further questions and I"m happy to help answer what questions I can for you.
Real Estate Agent · Fort Walton Beach, FL · Member since 2018 · 219 posts · 275 votes
8y
@Jacob Prelle This discussion interested me so I just tested the calculator on my existing rentals. On my studio condo it seemed pretty accurate but on my larger three bedroom beach front it UNDERESTIMATED by A LOT! I currently get close to $4000 per week there but the calculator told me an average of $970 per week for July. I think the reason for this is that the calculator is collecting data only from Airbnb reservations. Larger units like my beachfront condo in Ft Walton book mostly through VRBO. That is the case for all units like mine -- VRBO as 70% of bookings and Airbnb as 30%. My studio books mostly through Airbnb as do most other studio units in Pirates Bay. That's why the calculator is more accurate for that one.
I would say do some independent research by looking up similar listings on Airbnb, VRBO, FlipKey and even Craigslist, to see about prices and accuracy. I'll be very curious to know what you find out.
Rental Property Investor · Arlington, VA · Member since 2015 · 160 posts · 53 votes
8y
@Jacob if you’re talking about the default calculation it provides when you’re about to create an account. Then no, I wouldn’t say it’s 100% accurate. To get a better idea you’ll want to look at the Map and check out how much other listing that best match what your probably would look like.
Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes
8y
Just plugged in all four of my properties, and the estimates were wrong on all of them. Too high for my Pigeon Forge cabins that sleep up to 4, and much too low for my CA house that sleeps 6. It's always tricky for calculators like these to function well, because the solid information is not readily available, so the algorithm has to do a certain amount of guessing. And you never know how "smart" the algorithm is!
Another thing is we don't know what kind of data points it's pulling from... is it looking at nightly prices, or is it looking at the full booking cost (including AirBNB's booking fee)? The Pigeon Forge estimates would be pretty close IF they're looking at the "out the door" cost to renters - including tax, booking fee, etc. But that's not terribly useful to me as I care more about what I can set my nightly rate at; I don't want to reverse engineer the math to extrapolate what the property owner is charging, if in fact that's how the number is calculated.
Do some old-fashioned research, don't let this calculator get too excited. :) And research the local laws!!! Oceanside may very well have regulations limiting or forbidding short-term rentals, you want to know that before you buy. :)
Investor · Denver, CO · Member since 2016 · 533 posts · 433 votes
8y
I've been testing Airbnb's pricing during my low season (now) on (3) properties. I agree with @Villy Ellinger on the larger properties, grossly undervalued, however my smaller condos seem to be pretty much inline with their estimates. It's a little discouraging because I think they are eroding the pricing in our business as their motivation is to have us accept as many reservations as possible at the lowest possible price so they can capture their commissions. I would test VRBO's MarketMaker (beta) application as well as your location may vary by other channels.