See how much any address can earn as a short-term rental
Why use a short-term rental calculator?
Short-term rentals are a real estate asset that can provide impressive returns to investors in the form of rental income and property appreciation. When looking for new properties to invest in, it is imperative that investors understand the potential rental income, expenses, seasonality, and nearby competition to understand if a property would make a good Airbnb investment.
How to use our free Airbnb calculator:
Rabbu’s Airbnb income calculator is free and simple to use. Follow the below steps to receive your instant Airbnb revenue projection for an existing property you own or new properties you may be interested in acquiring:
Enter an address and input bedroom count in the search bar on rabbu.com
View the initial revenue estimate calculation
Adjust filters (bathrooms, guest count, amenities, etc.) and select or de-select comparable properties to refine your estimate
View important short-term rental metrics like: average daily rate (ADR), occupancy rate, revPAN (revenue per available night, calculated as: ADR x Occupancy), and a seasonalized monthly and annual revenue projection based on forecasted future market trends of how Airbnb rentals in this area perform monthly throughout the year
What data will you receive with your revenue estimate?
Rabbu’s Airbnb calculator includes the following data and metrics:
- Average Daily Rate (ADR): The average rate posted for Airbnbs in the search over the next 30 days.
- Occupancy: The percentage of nights reserved over the next 30 days of Airbnbs in the search.
- RevPAN: The average revenue generated per available night of Airbnbs in the search for the next 30 days on a seasonalized basis. The formula for RevPAN is as follows: ADR (Average Daily Rate) x Occupancy.
- Seasonalized Monthly Revenue Projection: How much this address could earn on average per month as a short-term rental. There is also a chart that helps investors visualize seasonality throughout the year, with the option to adjust it for the 25% and 75% percentiles.
- Nearby Comparable Properties: Nearby Airbnb rentals to the address searched. Including or excluding any of these comps will refine the estimate. You can also view comparable properties’ calendars for occupancy and pricing to help inform a pricing strategy.
How does the Rabbu Airbnb calculator work?
Rabbu has gathered the data of millions of Airbnb listings across the United States to calculate the earning potential of any address entered on its calculator. This is done using a series of algorithms and formulas that run behind the scenes weekly.
The data is refreshed weekly to ensure that investors and hosts are equipped with the most real-time data and information available.
The revenue figures presented on Rabbu’s Airbnb calculator are gross revenue figures. This calculation is not inclusive of cleaning fees, Airbnb’s fees, other service fees, or property management fees.
How much can you make on Airbnb?
Airbnb earnings vary greatly from property to property, market to market, and even host to host. Some factors to consider when analyzing a potential new investment as an Airbnb are as follows:
- How much competition is there in this specific market? How are those Airbnbs performing, and how does my property stack up?
- What is the demand for Airbnbs in the market vs. the existing supply? What types of occupancy rates is the market seeing?
- Are there any existing or pending short-term rental regulations in the area that may hamper my earning potential?
- What is the size of my property vs. other properties in the market? Do I offer any unique amenities?
- What is the seasonality like in the market? Is it somewhat constant, or are there peaks and valleys throughout the year?
Is owning an Airbnb profitable?
Owning an Airbnb can be one of the best ways to generate passive income, portfolio diversification, and monthly profit. Completing due diligence and underwriting any potential investment will help investors and prospective hosts understand how profitable a potential investment can be given the specific situation for the investor and the property.
What metrics make a good Airbnb property?
Every investor has their own set of metrics that they would classify as a “good investment”, though some rules of thumbs are as follows:
- The 1% Rule: This rule states that the gross monthly rent of your property should meet or exceed 1% of the property purchase price.
- The 15% Cash-on-Cash Rule: This rule suggests that after underwriting your potential investment, you should expect to see approx. a 15% cash-on-cash.
- The 10% Cap Rate Rule: This rule suggests that after underwriting your potential new property, you should aim to see approx. a 10% cap rate (or anywhere between 8% to 12%).
What are common expenses to account for in your Airbnb profit calculation?
Common expenses to keep in mind for Airbnb profitability are as follows:
OTA Channel Fee: OTAs are listing sites such as Airbnb and Vrbo. These sites charge you a percentage of booking revenue for listing on their sites. You should factor in 3% of revenue to go towards channel fees.
Cleaning Fee: Our Airbnb calculator does not account for cleaning fees as these fees vary greatly from market to market and are largely seen as a “pass-through” fee, i.e., you pay a cleaner, but the guest pays you back a cleaning fee.
Property Management Fee: If you are opting to go with an Airbnb property manager, you’ll want to account for the fee they charge you for management of your existing or new listing.
Furnishing Cost: Unless you are purchasing a turnkey Airbnb, you’ll want to factor in costs of furnishing your new listing. Furnishing costs can vary greatly depending on size of property, market, competition, and personal style preferences.
Supply Costs: These are ongoing costs such as coffee, toilet paper, shampoo, conditioner, and other consumables.
HOA Fees, Real Estate Taxes, Insurance, Etc.: These are fees not directly related to operating a short-term rental, but more so related to owning the property.
Ongoing Maintenance: It’s best to earmark approx. $100 for every 1,000 square feet of your property monthly for ongoing maintenance associated with operating an Airbnb.