What you should know before hosting on Airbnb

Whether you’re a traveller or not, it’s most likely you’ve heard of Airbnb. The digital marketplace, which connects people who want to rent out their extra space or accommodation to guests, has grown in popularity worldwide. 

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A lot of people have grabbed the opportunity to be part of the homesharing business market as an Airbnb host. Airbnb boasts of having millions of listings in over 220 countries in more than 100,000 cities. 

If you’re thinking of opening your space to guests as a host, below are some considerations to keep in mind before creating an Airbnb listing.

Goals v expectations 

Most people become Airbnb hosts to earn money. But hosting is more than just collecting cash from Airbnb guests. You must establish clear goals and expectations before venturing into this business.  

Define your financial goals. How profitable do you think your listing will be? What is the range of income you are expecting from being a host? Are you planning to be a full-time, part-time or seasonal kind of host? How many times do you want your listing to be booked per month? 


Aside from your goals, you must also manage your expectations. For example, running a successful Airbnb will take up your time. Are you ready to invest the necessary time needed to make sure your booking will proceed as planned? Are you prepared from any interruptions being a host can bring to your life?

Setting your goals and your expectations can help you have a clear vision of what you want to achieve in this business venture and how you can attain it. 

Personal safety

Personal safety is one of the main factors to consider before becoming a host. 

When you are hosting on Airbnb, you are essentially inviting unfamiliar people into your home or property. If this aspect of being a host makes you uncomfortable, then this business venture may not be the right fit for you. 

Airbnb has measures in place to vet potential guests and to ensure your safety. Airbnb requires guests to provide personal information such as their full name and email address before they can make a reservation request. Hosts can also ask for additional requirements such as IDs and other proof that will make them qualified guests. This may help minimize any risk to your personal safety.

Legal and regulatory issues

Before  becoming an Airbnb host, you should have a good understanding of the local laws in your city or country regarding homesharing. 

Learn the regulations for Airbnb hosting in your property’s location. Several cities have laws that limit a host’s capacity to rent out their space to guests for short periods. Most often, these restrictions are part of a city’s zoning or administrative codes. In some regions, hosts may be required to register, acquire a permit or get a licence before they can create an Airbnb listing or accept guests. Some cities completely ban short-term Airbnb rentals. 

It is also important to know how occupancy tax is collected within your property’s tax jurisdiction. In some areas, Airbnb is in charge of the calculation, collection and remittal of the local occupancy tax on behalf of hosts.  

You need to be knowledgeable about national and local laws so you will not receive fines or penalties.

If you are renting your property, you must check the lease for restrictions on subletting. Inform your landlord of your plans to rent your unused room or unit before creating a listing.  

Optimal listing price

Finding the optimal pricing for your Airbnb rental is essential if you want to maximise your profit and you want to continue earning on the platform for a long time.

Setting the price of your property is not a one-time thing. Airbnb provides hosts with a Smart Pricing Tool that automatically updates the nightly prices of your listing based on several factors. This includes the listing type, the location of your property, the season and the demand, among other things. 

However, the pricing recommendation given by Airbnb’s pricing tool tends to be lower than the best prices which can be achieved in the market. This is because Airbnb’s pricing tool aims to boost your number of bookings and not the profits you will earn.

As a host, you must be prepared to constantly monitor competitive rates and special events to keep your pricing optimised. You must also learn how to customise your rates to include additional costs such cleaning fees and maintenance expenses. 

Neighbor relations 

If the room you are planning to rent out is part of a community with a shared space, you should have plans on how to manage your relations with your neighbors. 

Even if you have a separate house, you should still be considerate about the disruptions your guests might cause to your neighbors.

Noise complaints are the most common negative feedback of neighbors of booked Airbnb spaces. To avoid hurting your relations with your community or neighbors, set house rules that can manage noise issues with guests. Some hosts do not allow parties or gatherings in their spaces and some specify a certain time when guests should start minimising noises. 

Risk and liability 

Becoming a host comes with several risks. By opening your home for short-term rent, you are putting yourself and your place at risk of theft. One worst case scenario is when a guest becomes a squatter and refuses to leave. There is also the possibility of property damage by irresponsible guests. 

You will also be exposed to potential liability risk if your guests claim they were hurt or if they damage other property or injure neighbors during their stay.

On the bright side, Airbnb has incentives and programs in place to ensure that hosts will be protected. The company offers an Airbnb Host Guarantee that gives the host protection for up to $1,000,000, which will cover any property damages that are bigger than the security deposit paid by guests. 

Meanwhile, the Host Protection Insurance gives coverage for hosts against third-party claims of bodily harm or property damage during a stay. But this insurance may not cover everything, so you may need to get additional insurance for your accommodation.  


There are risks that come with becoming a host. You will need to be continually learning and  adapting your Airbnb listing to the new market trends, shift in business conditions or even changes in local laws. 

If you think the challenges and risks outweigh the benefits of becoming a host, it might be practical to look into other side hustles. But if you are willing to put in the effort and dedication needed to become an Airbnb host, this venture has a high chance of paying off. 

Is hosting on Airbnb the right side hustle for you? For more up-to-date tips and guides on how to turn your hobby or interest into a money-making opportunity, explore nestegg today!

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