A solid understanding of your rental’s financial performance is crucial if you own or are looking to invest in short-term rental (STR) properties. One of the most effective ways to measure this performance is by creating a short-term rental spreadsheet.
In this article, you’ll find a comprehensive short-term rental spreadsheet template to help you underwrite potential investments to see if they meet your needs.
We’ll also show you a free tool you can use instead to calculate those same financial projections by simply entering a property address.
Free Spreadsheet for Short-Term Rental Property
This free spreadsheet calculates the potential returns of short-term rental property investments. It covers all the financial calculations mentioned further in this article and includes mortgage amortization and cash-flow analysis. Plus, it comes with automatic formulas and calculations that do the hard work for you.
To download the template, click on the link below, select “File” in the upper left-hand corner, then choose “Download” to save it in the format you prefer:
Download Rabbu's short-term rental underwriting spreadsheet →
Instantly Calculate Revenue and Return Projections on Any Short-Term Rental Using This Free Tool
While spreadsheets can calculate revenue and return projections, they can also be time-consuming and limited.
Rabbu's Airbnb Calculator helps take the guesswork out of short-term rental investments by providing an easy-to-use, free tool to estimate revenue and returns on any property in the US. You receive detailed projections by entering the address of any property. Plus, with Rabbu's other free tools, you get access to market-level insights and the ability to browse underwritten investment opportunities.
Estimate Potential Revenues and Returns
Typing in an address on Rabbu's Airbnb Calculator instantly generates a directionally-correct projection of potential rental revenue. It also includes detailed insights, such as estimated net cash flow, annual income, and other metrics that provide a comprehensive view of your investment’s performance.
- Projected nightly rate for your rental (or ADR) based on performance of nearby Airbnbs
- Average occupancy rate, estimated on a monthly and yearly basis
- Seasonalized revenue projections
- Average daily rate (ADR) posted by nearby Airbnbs in the next 30 days
- Occupancy percentage of Airbnbs in your search
- Revenue per available night (revPAN) generated by Airbnbs in your search radius on a seasonalized basis
- Comparison against the average market rate in a similar location
- List of amenities offered by competitors near your property
To automate the underwriting process, you can leverage Rabbu’s on-screen investment calculator to type in a purchase price and receive the following:
- Estimated net cash flow and annual income
- Total cost of ownership (including loan payments, taxes, and fees)
- Projected returns on investment as a percentage (cap rate, cash-on-cash, gross yield, etc.)
Fully Customizable and Interactive
The Rabbu Airbnb Calculator allows users to customize their potential financial projections with several filters:
- Location radius
- Property type
- Guest capacity
- Amenities
- Occupancy
- Number of reviews
- Comparables
- Average daily rate
- Days since the last review
- Number of consecutive unavailable nights
These filters enable you to refine your results and better predict what you can expect from your short-term rental investment.
Underwriting Return Calculator
The underwriting function of the Rabbu Airbnb Calculator lets users enter variables related to their prospective property investments and receive a forecast of their financial returns. Users can enter variables such as these:
- Total purchase price
- Revenue
- Expenses
- Monthly mortgage payment
- Upfront capital investment
The calculator then provides metrics, such as gross rental income, net operating income, cash flow after all expenses, return on investment as a percentage, and estimated annual income.
With this data, investors can quickly and accurately screen potential properties. They can uncover a property’s targeted rate of return, compare short-term rentals for sale to optimize investments, and make informed decisions regarding an offer price when purchasing a property as an STR.
If you're ready to explore all of the valuable services offered by Rabbu, including the Airbnb calculator, market data, investor tools, and listing an STR for sale, visit Rabbu. There you can also Create an Account to get access to hand-picked, high-yield investment opportunities from Rabbu's CEO daily to help take your short-term rental investments to the next level.
What to Include on a Short-Term Rental Spreadsheet
If you prefer using a spreadsheet to analyze rental properties, here’s what you need to include to analyze a potential short-term rental investment and make informed decisions.
A comprehensive short-term rental spreadsheet consists of various essential components that provide insight into rental revenue, expenses, and other factors that affect your bottom line. The following sections list the 4 main categories you should include in your short-term rental spreadsheet.
Property Details
Before analyzing the financial performance of your short-term rental, make sure you include all the relevant property details in your spreadsheet so you can easily identify which property the spreadsheet is about and refer back to it later:
- The property address
- Regulations and permit information that may affect occupancy
- Property specifics, such as the type of property, number of bedrooms and bathrooms, and other relevant information
- The rental revenue per available night (revPAN) — you can get this number by running the address through Rabbu’s free Airbnb Calculator that we discussed above
Initial Investment
Understanding the initial investment of your short-term rental property is crucial for optimizing your rental business and increasing your revenue. Knowing your start-up expenses helps you estimate your potential return on investment (ROI) more accurately. Here is a list of some of the essential initial investment details to include on your spreadsheet:
- Purchase price
- Closing costs
- Immediate repairs
- Furnishing costs
- Other expenses
- Due diligence required (such as scheduling a technician for appliance installation or taking photos for marketing)
Financing Assumptions
By understanding the impact of financing on cash flow and cash-on-cash returns, you can make more strategic decisions about your vacation rental property investment.
One way financing impacts cash flow is by determining how much money you pay upfront for your rental property and how much is paid monthly in loan payments. Interest rates also affect cash flow and profitability, as a higher interest rate results in higher monthly loan payments and reduced net cash flow.
Additionally, the loan term, or amortization, plays a role in your rental property's long-term profitability by determining the time it takes to pay off your loan, affecting your overall return on investment.
Essential information in this category to list on the spreadsheet includes the following:
- Loan amount
- Down payment
- Loan closing costs
- Interest rate
- Interest type (fixed vs. variable)
- Amortization (loan term)
- Upfront costs (appraisal, loan, inspection fees)
If you need a quote to understand your financing options, especially for DSCR ("Debt Service Coverage Ratio") loans, you can find lender matches here.
Revenue & Expense Projections
This category involves projecting revenue, calculating costs specific to short-term rentals, and other operating expenses associated with your rental business. Estimate gross revenue, net operating income, and other financial metrics by including revenue projections in your analysis tool.
You can make informed, data-driven financial decisions about your rental business by estimating and tracking these metrics to maximize profitability.
Revenue
- Gross rental income
- Other income
- Total revenue
Expenses
- Channel fee
- Property management fee
- Ongoing supply replenishing
- Other Expenses
- Property taxes
- Insurance
- HOA fees
- Utilities
- Maintenance
- Other ongoing expenses
Net Operating Income (NOI)
The net operating income (NOI) metric analyzes a short-term rental’s financial performance. It represents the total revenue minus total operating expenses, excluding loan payments.
The exclusion of loan payments from the NOI provides a clear understanding of your rental property's profitability without any impact from financing.
Loan Payment
A loan payment amount for short-term rental property financing typically includes four parts:
- Principal repayment: The principal is the amount you repay each month to reduce the amount borrowed, often amortized over the life of the loan. This portion does not count toward your rental property operating expenses since it's not considered an operating expense.
- Interest repayment: Interest is the amount you repay each month to the lender in exchange for borrowing the money to purchase your short-term rental. The interest portion of your loan payment counts as one of your rental property's operating expenses.
- Insurance premiums: Property owners are responsible for purchasing landlord insurance to protect their short-term rental investments from damage due to fire, theft, and other hazards. Premiums are typically paid in monthly installments and may include additional costs for the coverage of furniture, appliances, and other property features.
- Property taxes: Loan payments may also include funds held in an escrow account to cover the borrower's property taxes when they become due and payable. This ensures you stay up-to-date on your property tax payments, as lenders require.
Leveraged Net Cash Flow
Leveraged net cash represents the amount of cash flow generated by your property after expenses and monthly loan payments, providing a clear picture of the rental property's profitability and taking financing into account.
Other Financial Metrics
- Gross yield: Calculated by dividing the annual gross rental income by the property's purchase price, this metric estimates a short-term rental’s profitability. It helps evaluate the rental property investment's potential over one year, allowing investors to compare the potential profitability of several properties.
- Cash-on-cash return: Dividing the leveraged net cash flow by the total cash invested in buying and maintaining the property measures the annual return on the property investment based on the amount of cash invested. A high cash-on-cash return indicates higher potential profitability.
- Cap rate: This metric is expressed as a percentage and calculated by dividing the net operating income by the property's purchase price. The cap rate tells you the return percentage you could expect on an all-cash property purchase if it operated as a rental. Generally, a property with a higher cap rate may indicate higher profit potential.
Next Steps: See How Much Any Address Can Earn as a Short-Term Rental
Rabbu's free Airbnb Calculator makes it easy for investors to assess potential returns on any short-term rentals by eliminating the need for cumbersome manual spreadsheets. Our calculator allows you to effortlessly estimate revenue and return for any property in the US by simply inputting its address.
In addition, Rabbu's other complementary tools grant access to market-level insights and the opportunity to explore carefully evaluated investment options, all at no cost.
