Improve Your Airbnb Rental Income:
7 Ways to Boost Your Return on Investment Through Data

When it comes to short-term rentals (STR), it can feel like there are more questions than answers. Whether you’re hosting your first STR, adding to your portfolio, or simply wanting to improve your existing Airbnb rental income, there’s just so much to know—from the amenities, occupancy, and average daily rate (ADR) for your own properties to what your competitors are doing in each of these areas. 

Without using data to optimize your rentals, you can get overwhelmed by all the decisions you have to make. Or worse, you can leave money on the table because you just don’t know what your STR may need to really bring in top-dollar revenue. 

Here are seven ways hosts can use data to optimize both their listings and their Airbnb rental income.

1. To be (pet-friendly), or not to be: Make your listing more attractive

Making smart improvements helps you get the most out of your investment. Amenities are a widespread use case. Knowing what has the biggest return on investment (ROI) helps you decide where to invest in upgrades. The key here is to find out what features add value without being too costly or difficult to implement.

For example, if “properties with a hot tub in your neighborhood make 25% more than those without,” adding a hot tub may be a safe bet to make your listing more attractive. The same goes for being pet-friendly, enabling instant booking, offering a washer/dryer, and more. 

With access to historical vacation rental data on homes in your area, you can see how amenities directly impact booking rates in your market. Use this information to make strategic decisions for your properties.

2. Stay Engaged: Keep an eye on your performance metrics

Stay on top of your property’s performance—and the performance of your competitors. Regularly checking in is the best way to stay on top of how your properties are doing, whether you have your competitors or a broader market trend to thank for changes in performance.

For instance, if your property saw a dip in occupancy last month, that could indicate a problem with your listing, your pricing, or another rental feature. But it could also be part of a broader market trend. Are competitors booked up? Or did your whole area slow down? 

If you’re monitoring performance metrics, you’ll be able to spot interesting insights, like competing listings that have both better occupancy and higher nightly rates. You can also compare your performance with that of the broader market to see if there are trends you should act on, like the ADR of booked listings compared to the ADRs of those that are still available. Knowing your performance metrics and understanding them against your competitors and market makes it easier to act confidently and keep your revenue up.

3. Dream big, but not TOO big: Set realistic goals from the get-go

It can be tempting to set your STR sights on high revenue goals. But if you set unrealistic expectations, you’ll be disappointed when you don’t hit those targets. And if you do hit them? Maybe it’s time to boost those goals—but only if the market will support it. 

Use an Airbnb calculator and vacation rental data to know precisely how much revenue a property is predicted to make so you can set realistic expectations from the outset. With the right tools, you can make accurate projections on how much to charge per night, your minimum night stay policy, if working with a professional property management company is worth it, and more. 

STRs are a big investment, but they can also offer up big returns. How you feel about your ROI has everything to do with the goals you set. If you set data-backed goals that you can actually hit, you’re setting yourself up to not only achieve your ROI milestones but also feel successful when you do—rather than waiting for revenue that may be out of reach.

4. Use your home AND make money: Choose the right days to block

One of the perks of owning a vacation home is actually getting to vacation there. While using your home as a short-term rental is the main reason you bought it, you also want to enjoy it yourself. The right data can ensure that those two goals aren’t mutually exclusive. 

Use data and insights to discover the best days to block on the calendar for your own getaways without hurting your overall revenue. For example, would it be better to enjoy your holiday home during the work week or on the weekends?

Being able to accurately predict how much revenue you’d lose by blocking different days or weeks on the calendar lets you enjoy your investment without compromising your ROI. And if you really want to take that prime week for yourself, you’ll at least know what revenue you’ll need to make up for later.

5. Grow your empire: Find your next STR

Vacation rentals are a big investment, and you want to make sure you choose wisely. While it’s tempting to go with your gut, your gut doesn’t always know what’s happening in the broader market. Even “sure-fire” vacation destinations may be a less-than-optimal investment if the area is already saturated with STRs or if supply is outpacing demand.

Knowing (not guessing) which cities and neighborhoods are best for your next investment is critical. Here are some questions you should ask about your next STR investment:

• Where is the best place for me to invest?
• Are smaller units or larger units more profitable?
• What is my expected revenue? 
• Which listing type performs best—unique stays, urban apartments, or something else?

Data is the best way to confidently answer those questions and even compare STR investment options side-by-side, all of which can help you find a winning addition for your portfolio.

6.Don’t be left behind: Monitor seasonality 

Most vacation rental owners who want to maximize revenue have one challenge in common: seasonality. In most markets, demand does change during different times of the year, but how demand changes isn’t always obvious or clear-cut.

Colorado ski towns, for example, are starting to see higher demand in the summer among adventurers planning hiking or mountain biking trips. Beach towns, likewise, are becoming popular in the fall for travelers who prefer a quiet, more relaxing beach scene. If you miss seasonal shifts like these, you’re losing out on potentially lucrative opportunities to either add to your STR portfolio or optimize your listing for what used to be the softer shoulder season.

Accurate data can help you answer key questions like: 

• Should you expect to make most of your money during peak season? 
• What does your shoulder season look like? How can you keep the off-season from being a complete loss?
• How does your property type impact seasonal rentals (does your romantic condo do better during Valentine’s Day while the five-bedroom home down the street rocks for large holiday gatherings)?

It’s also important to keep an eye on how far in advance guests book in your market. Do travelers to your location tend to book last minute or plan way in advance? Knowing common booking behaviors can help you make sure you open your calendar and optimize your pricing to catch them at the perfect time

7. Be nosy: Dig into the competition

Checking out the best properties nearby shows you what you’re up against—and not just to monitor their pricing. Though it can be tempting to beat out competitors by pricing a little lower, you might end up leaving money on the table. In fact, there are other more lucrative ways to edge out the competition. Monitoring competing properties will help you spot them. 

If your competition is mostly cookie-cutter STRs, for example, consider how you can make your listing more unique. Unique Airbnbs often outperform the rest (think treehouses, quaint cabins, or interestingly themed stays), so consider how you can change up the style and decor to stand out from the crowd. 

Distinguishing your STR might also be as simple as optimizing your listing. With the right data, you’ll be able to provide the right amenities, mention the right details in your listing, and set the right prices for popular days—all of which can be a winning combination for ROI.

Conclusion 

STR trends are powerful. But so are data and analytics. No matter how many listings you have, data can always boost your ROI potential—whether that’s by revealing the amenities you should add, the ADRs you should be setting, or the competitors you need to beat. 

Finding the right data and insights doesn’t have to be hard or time-consuming either. MarketMinder from AirDNA pulls millions of property- and market-level data points into a single, easy-to-use platform. Read up on data like future occupancy, booking rates, booking lead time, and more so you have an expert-level understanding of your vacation rental market.