Ep 69: How I Accidentally Made $7,000/hr With My First Airbnb… A Breakdown of an Hourly and Annual Rate for Short-Term Rental Owners
Ever wondered what an hourly rate of an Airbnb host actually is?
If so, this episode is the one for you!
Today, I unpack some of my hourly rates in our first short-term rental property… the one where I became an accidental 6-figure host.
I had the idea while I was out running errands so you’ll be joining me live as I work out these hourly rates.
Enjoy and I hope you’re inspired!
Want to learn more about making a pretty impressive hourly rate on a short-term rental… or even just BEING in the Airbnb economy?
Also… I’ve added a previously unannounced bonus to my early buyers… It’s called the Vacation Rentals Labs
In it, I’ll unpack exactly how we’re adding properties to our portfolio in 2021.
And… I’ll be showing you how I have brought and am bringing online the additional revenue streams that I mention in today’s episode!
This is an insane bonus!
Head over to ginnytownsend.com/rental right now to secure your place at the top of the early bird list and I’ll let you know when it’s LIVE this month!
And if you’re curious about how much you could potentially earn with an Airbnb in your area, I can send you a free and pretty powerful tool to help you estimate…
Visit GinnyTownsend.com/estimate to claim access to this powerful free tool!
Thanks for joining me, and until next time, continue to be up and to the right.
EPISODE TRANSCRIPTION
What’s up, podcast nation! Ginny Townsend here and thank you for joining me for another episode. I am out running errands right now among other things. I am finishing up some Furnishing purchases for an Airbnb we’re bringing online. Hopefully by the beginning of March and every time I am working on this project this listing I keep thinking to myself what else
And I share with my listeners. What else like what little nuances what part of the process is? What can I share? And I was also thinking about as I was out looking and making some decisions for purchasing with the core about my previous episode where I talked about Furnishing listings for other Airbnb hosts as a revenue model, even if you don’t have a short-term rental, and so
So Furnishing is a part of my roadmap for this quarter and the rest of this year. And as I was thinking about that model, I want to make sure that my per hour rate. So my time is that it’s valuable enough for my time, right? Yeah, just making sure that it is still a win-win for both me and the host the other post, but like I said just worth my time.
And I’m trying to figure out if I can Outsource the actual furnishings and still make a decent amount and that per hour amount got me thinking and I was like, okay. I wonder how much per hour I made originally on like our first Air B&B. I just want to use that as an example because that’s the one that brought us past the six figures what and that’s the
One where I experienced the biggest learning curves, right? Because it was I was an accidental six-figure host. So it’s like, okay. What was my per hour as an accidental six-figure host and there’s a couple of things about our listing that made it a bit unique? So I think it’s worth saying one we in the time that we were in and in the neighborhood we were in there were regulations and then also neighborhood covenant saying we couldn’t have short-term.
Enters stay less than 30 days at a time. And so that was already I mean a limitation a factor into who we attracted as guests. But then also I mean it did in a way cap how much we could earn right because you can obviously make a lot more if you charge per night and guess just a one two three nights or something like that. You can just make more on the per night, but we had pretty much essentially a hundred percent booked for those.
Three years. I want to say there was a leaven days total between guests moving out and moving in that the place was empty so that I thought was worth noting for context is I just had that minimum one guest a month. Some of the guests stayed a little longer and I’ll go into that. So at first I didn’t realize I was undercharging, you know, you learn these things right, but I was definitely undercharging and one of my first tenants was a traveling
First she was incredible and had a three-month contract at a local hospital. And so she paid 2,800 dollars a month and stayed for three months. And so that first month getting her set up there were a couple of things that she requested and because she was going to be there for longer than one month. I was willing to oblige and one of them was she was bringing her young son with her and just wanted to make sure that there was a security system and as like, you know what that is.
Fine, so I did like the Simply Safe. It’s like $20 a month, you know, not a problem. I did a little bit of research ordered, you know sent the material like the why when installed that system so it wasn’t an and in conversations with her making sure that you know, this was a great place for her and I think very realistically I spent about let’s just say I’m going to overestimate and probably say I spent six hours that month getting her.
Situated set up all of that. So $2,800 divided by 6. I made that is $466 an hour that month, but she stayed for two more months. So if I were to spread out those six hours over the three months and make it two hours a month forward a budget the time that way so torrent so
added times 3 and then divide by 6. I need fourteen hundred dollars an hour. Alright. Alright. Now, let’s multiply 14 hundred dollars an hour times 2080, which’s the typical 40-hour workweek over a year is so 925. You work 2080 hours a year that is two point nine million dollars my hourly rates for that.
How to run rate had gotten my full-time, you know 2000 hours and that would have been 2.9 Million dollars a year that is not bad. That is not bad fourteen hundred dollars an hour. We’re okay with that right? We’re okay with that. Okay, so then let’s cut to when I started upping our price significantly. We started out around 2800 and stayed up around.
And 5,000 at the end. So like I said, I was I was definitely undercharging but that’s okay. I just didn’t know what I didn’t know right? Okay, so then we had guests stay for on the price increase from 2800. We can go to twenty hundred to five thousand overnight. We just gradually increased over time. I know that one of our guests actually stayed for six months. They were moving from out of state and didn’t know where they wanted to buy in the area.
We had our in the metro area where we had our Airbnb and they wanted to have like say in a furnished place to kind of get to know the area and all of that and so they ended up staying at our place for six months and they were they paid 3500 dollars an hour or $3,500 a month getting then situated. There were a couple of isms to so in our master bedroom. We had a queen-size bed. They had a they wanted a king and so
So we had someone moved that move that bed out and they had their bed shipped in so it took a look there was a little bit of coordination and then we had to move some of the tools in the garage. We didn’t really it wasn’t really tools but like there was a workspace in the garage. So we needed to move because they had a Tesla and needed to have access to an outlet in the garage. Okay, but that was really it and then they paid every month.
Others for six months straight right? And so I’m going to say that upfront with there were a couple of isms there were like I said and they were going to stay longer. So I thought it was well worth it. Try, you know the time invested to figure it out. I’m going to say 10 hours upfront the amount of time that it took answering their questions kind of making sure things were set up in a way that
they felt like they could be there for six months and pay us really well to live there. Okay, so that first month provides or to $500 / 10, obviously, that’s really easy math 350 dollars an hour that first month. That’s just not bad. All right. First of all, let’s see multiply that by 2080 to get an annual salary that is seven hundred and twenty-eight thousand dollars a year. That’s not bad right – okay, so but then each
Subsequent months I could not have to put those 10 hours in I probably put in about a half hour a month because they actually wrote they wanted a physical invoice and wrote us a physical check. So I’m just going to inflate the amount of time. I spent printing off and sending them an invoice and then making sure it was the cash. The check was cashed when I got it in. So 3,500.
Divided by 5 that is 7,500 dollars an hour. Is that right? Am I doing that right thirty-five hundred divided by 0.5. Wow. Okay. No 7000 I made $7,000 an hour those months for a half. Oh my gosh, that’s incredible right now. Join with me on this journey. Thanks for just being here with me. And as I’m going through and discovering this I figured it would be really fun to actually figure out the
Numbers while I was talking with you. So we’re going to take that seven thousand dollars an hour again because it took me about a half hour and they paid me $3,500 a month. So do you see how I got to the seven thousand dollars an hour? Okay, so we’re going to multiply that by 2080. That’s the number of hours and a full Year’s worth of work 14.5 million dollars friends. This is the kind of work for us, isn’t it obvious?
SLI, I did not make a 14.5 million dollars that year, but that’s the Run rate that is if you want to compare apples to apples your earnings compared to a typical job to like compared to any other Venture you’re doing figure it out on an annualized salary and then you’ll be able to compare apples to apples. That is the only way because time is obviously our most valuable asset we can’t contribute infinitely.
Because time exists it’s a structure to system. So 14.5 million dollars. I like that number. I like that number. So I hope you see how much like why another reason why I love the vacation rental model so much. It is a multiplier of your time and there is a there’s a quote. I recently heard because I’m always trying to learn I explained it the other day. I was talking to another real estate investor.
Her I told him I’m trying to figure out more on ramps, you know to to gaining control of more properties to have them listed as short-term rentals both for our own families benefit. But then also I can pass on my learnings to you. All right, and so as I’m learning all of these new on-ramps I came across a quote from a real estate investor who I think was quoting someone else. So this is but the point is the quote is the less time.
Work some more I get paid that is kind of a bind Bend. But if you can find something that will multiply your efforts exponentially like a vacation rental can where you get paid month after month for once your listing is live. That’s when these insane dollars per hour rates will start kicking in so I can’t wait to update you on that is now my personal number to beat.
Eat is a 14.5 million dollar run rate a $7,000 an hour task. That’s my personal best to beat interesting. Right? So interesting. Okay. Well, I hope you found this episode enlightening and inspiring and if you did if you want to explore more of what owning a vacation rental or being simply in the air B&B economy can do for you.
You to diversify income helping you to make pretty insane per hour rates similar to this now. Obviously, this is not a guarantee. But if you put in the work, those are the rewards those are the rewards that I got on abstinent was a $7,000 an hour rate that was on accident my friends. So I am putting on the finishing touches to the six-figure vacation rental road map right now, man. I think you’re really gonna like it and I talked about in the last couple of episodes a new bonus.
Des that I’m adding to the to this course for my early buyers and I’m calling it the vacation rental Revenue labs and this will be where I am exploring more of those on ramps. Like I just mentioned where were either acquiring or gaining access to getting control of properties be able to put them on Airbnb. But then also the additional revenue streams that I mentioned in a previous episode that really have nothing to do with actual ownership of a short-term rental.
They have to do with the are BB economy. If you want to get on that early bird waitlist to hear exactly when and get all of the details about the six-figure vacation rental roadmap have to find furniture and fill your short-term rental go over to Jenny townsend.com to rental and you can find all of the details there put your name in and I will let you know as soon as it is live. So thank you again so much for joining me today. I hope you are inspired I am.
I am on cloud nine. I can’t believe that seven thousand dollar an hour rate. I’m going to figure out a way to beat that and when I do I’m going to report back to you. So thanks again for joining me and until next time continue to be up into the right.
