3 Reasons to Rent Your Home on Airbnb in Retirement (No-One Thinks of #2!)
If I asked you to picture the average Airbnb user (renter or homeowner), what image would pop into your mind. If you saw a picture of a 28-year-old nomadic hipster with an ironic beard and million-dollar smile, you wouldn’t be alone. In fact, this is exactly how Airbnb got its start… with young adults renting to even younger travelers.
But, as Airbnb has evolved, the face of Airbnb has gradually changed… both in reality and in terms of how the service talks about its users. Airbnb has matured and, now, you are just as likely to be greeted at your destination by a semi-retired tax accountant from Seattle as a 20-something surfer dude from San Diego.
Just take a look at the following 30-second ad spot and you’ll get an idea for how much inclusiveness is becoming central to the company’s message:
Airbnb’s shift to older demographics also makes great business sense. After all, it’s no secret that Millennials are struggling to get onto the property ladder. If Airbnb wants to grow, it will need to convince new groups – from parents to grandparents to let strangers into their homes. And, today, I would like to argue that, as retirees (or soon-to-be-retirees), we should do exactly this!
Here are 3 reasons that retirees and soon-to-be-retirees should consider renting their house or apartment on Airbnb.
It’s All About the Money… Or is it?
The first reason to consider renting your apartment on Airbnb is the most obvious… to help fund your retirement.
Everyone knows that, despite the fact that we are the “richest generation of all time,” most of us don’t feel like millionaires… or even 100,000-ionaires.
One of the things that I have discovered, personally and by talking with 1,000s of retirees, is that a little extra passive income goes a long way to mitigating our lack of savings. Here’s a quick example…
According to Priceconomics.com, the average Airbnb host makes $924 per month, renting their property through the service. Let’s round this up to $1,000 for easy math.
So, how much would you have had to save to give yourself an additional income of $12,000 per year? Let’s say that you make 3.3% on your bonds (that’s the 2018 return for the U.S. Aggregate Bond index), you would need to have saved $363,000! Of course, I’m simplifying things here.. you could also liquidate a small percentage of your holdings each year.
But, the main point remains. When it comes to retirement, an ounce of passive income is worth a pound of savings.
Even if you are still living in your home, renting our a room or converting your garage into a granny flat could make a huge difference to your lifestyle.
But, to be honest, money isn’t the only (or even most important) reason to consider renting your property on Airbnb.
Stay Social and Fight Loneliness
One of the biggest risks that we all face as we get a little older is loneliness. According to some studies, the negative effects of social isolation can be as bad smoking a pack of cigarettes per day!
Of course, if you rent your house or apartment on Airbnb, you don’t have to socialize with your guests. But, this is always an option… especially if you have an “experience” that you can share.
I put “experience” in quotes, by the way, because this is a new category of services that Airbnb is putting a lot of marketing weight behind. Basically, in addition to renting your property, you could choose to create an experience for your guests to enjoy… this could be as simple as cooking them an authentic dinner in your local cuisine. Or, it could be as complicated as taking them on a tour or teaching them a special skill.
Not only can you potentially charge more when you offer an experience, but, you will also have the opportunity to meet some amazing people.
So, if you are looking for ways to stay social in retirement, renting on Airbnb may be a great option.
Giving Yourself the Flexibility to Travel
One of the joys of retirement is having the flexibility to travel wherever and whenever you want. But, when it comes to travel, so many of us feel restricted by our mortgage or other home-related costs (maintenance, taxes, etc).
With Airbnb, you have the option of turning your home into a cash-generating machine that will give you the flexibility you need to explore the world. But, it’s not just about the money. It’s also about knowing that someone will be looking after your home so nothing will get stolen.
And, in the unlikely case that something bad does happen through the fault of one of your guests, Airbnb has become much better at helping out… both from a customer service perspective and in terms of insurance.
In future articles, I will share some tips on how to get started with Airbnb, as well as, how to make the most money possible from your property once you sign up. But, for now I hope that I have at least whetted your appetite enough for you to want to check out Airbnb and think about what it might be able to do for your retirement lifestyle!
Would you ever consider renting out your home in retirement? Why or why not? If you did decide to rent out your property, would you consider using Airbnb? Why? Let’s have a conversation!