Tel Aviv is known as “the city that never sleeps”. It is for sure a vibrant Middle Eastern destination, attracting millions of tourists every year. Tel Aviv harbors beautiful beaches, uber-hyped restaurants, a diversified and active night-life, and much more. It is a Wonderland for some of us because you’re able to find anything you wish for, at any hour of the day, or just the city people work at, or Sodom and Gomorrah for others. You name it!
However, be sure the city sees new faces every day that the Earth makes. In 2015 only, an estimated 2.3 million people visited Tel Aviv according to the Central Bureau of Statistics in Israel. Less than 45% of hotel beds are occupied throughout the year, and the number of tourists is increasing. This brings us to our main and beloved topic: bed and breakfast in Tel Aviv. A gap can be filled, and it seems the local “rentrepreneurs” are working on the topic quite actively. Let us dive into the 101 of hosting!
- KYC – Know Your City!
How many properties are on the market in Tel Aviv? What is the peak season? Which neighborhood is surfing the trend wave right now? Many, many questions might come to your busy mind right now. Don’t worry, we have many, many answers to share with you 🙂
Let’s get straight to it. 8’500. That’s your number. Slightly more than 8’500 active listings on Airbnb only, in Tel Aviv, according to airdna.co and bnbstat.com. So let’s do some simple maths here: 2.3 million tourists in 2015, 10’000 hotel beds in the Tel Aviv district that are occupied at 45%. Not mentioning all the Israelis coming to spend a weekend or some holidays in this mad city. The scene is not overcrowded! Now, knowing your city does not mean knowing where to get the cheapest booze around (well, actually this is valuable knowledge as well!). It all depends of what you’re expecting from your listing. If you’re looking to do it like a boss, then you must indeed know your city and know what are the main events throughout the year and how many tourists it’ll attract, it means you need to know which neighborhood is dope and which one is a no-go zone, you must know who does what in terms of other Hosts.
- Is renting my property on Airbnb really a good deal or what?
A good theoretician will answer “it depends”. Well, people, we are not doing an essay here. We are bringing facts to you. The last two years, we welcomed more than 2’500 guests and generated some decent revenues. This includes our rookie period where we had no clue of what we were doing. We have now decided to go international and spread the word. Why? Because we love our job and we believe that sharing is caring, and caring is sharing, and the more we’ll share with you guys, the more the industry will expand.
Our occupancy rate is tickling 25 nights a month on average, and we are selling the night for $79 to $339, we reached $1’490 a night for a regular flat at some point, but that’s not interesting (just kidding, we’ll get to that story later). I’ll let you process those numbers for a moment.
So now, pack your suitcase, let us prepare your flat, and take a few days off and let your space pay for the whole party!
- A picture is worth a 1’000 dollars.
That being said, the art of hosting demands some serious skills. The market is shifting; listings with 4 shady pictures showing the next-door student’s apartment with dirty laundry on the floor is no more. You can check for yourselves how it evolved, how the quality of the properties advertised is competing with high-end hotels. Not only that the apartments are well decorated, but the pictures themselves are something else. And hell yeah we recommend you to spend some extra money and get this done by a professional photographer, you will notice the difference straight away. As a matter of fact, you don’t even need to hire a photographer as Airbnb offers this service to their Hosts. Click here to know more. And please, make sure the place is clean before the shooting.
- Know Thyself and Thy needs.
There are two types of Hosts. Those who want some extra cash at the end of the month, and those who are making a living out of it. Be sure to stick to your category otherwise you might get yourself lost in Limboland, and trust me, it is not what you want. Let me illustrate the two cases.
The extra-cash-at-the-end-of-the-month: I remember a close relative who advertised his apartment only in weekends and at a high price. He had no particular will to rent the place, however every time some nice guests booked his place, he was taking his little family to a new destination for the weekend. Due to the high price he set on Airbnb, his rental income paid for the whole weekend! That’s what I call some nice passive income!
The professional renter: there are more and more entrepreneurs who are making a living out of Airbnb. The business is blossoming and there has never been a better timing than right now. If you’re planning to join the team, be sure to prepare yourself. Automation is the key to your success, standardize as many tasks as possible. You’d want to have the exact same bedsheets and towels in each property you manage, you might want to have the same standard message you send to each guest
The limbo: if you’re looking for some extra cash, you will quickly be tempted by renting your property more and more. Soon enough you will start to feel like a stray zombie, forgetting where you live. There is nothing more tiring for the mind than living in a suitcase, and after a while, people will wonder what’s wrong with you. Rumors will fuse about you that you became sort of a vampire, and worse! Well, maybe not that far. But think twice before throwing yourself out of your own apartment, because once a guest is in, she might not like to be bothered every two days because you forgot a pair of socks.
- Be sure to enquire about local regulations.
That is probably the most important aspect of the game. Owners are free to rent their properties on Airbnb in Israel. The Government does not flag short term lease as long as Hosts pay their taxes and reflect their total sales. As of 2016, tax authorities proposed that short-term lessors pay a 35% tax rate and a monthly fee of ILS 400. For landlords renting out their properties as residential units only on a long-term basis, there are tax benefits considerations such as a flat 10% rate. There is also a law on taxation regarding residential rentals that exempts Hosts having a yearly rental income of below ILS 5,030. Tenants renting their units for commercial purposes should however disclose their activity to their landlord, and pay their income tax in full, including VAT and municipal taxes. Aside from taxes and other fees, Airbnb Hosts should not fail to comply with the rules and regulations of their corresponding buildings. Of course, you should consult a proper lawyer to get better advice.
Extra point: Is it correct that you’ve rented your place at $1’490 a night?!
Yes, it did happen. You might want to know “how, why, where, who?!”. Pretty simple: market analysis. And even with this, we missed a few extra thousands. Have we known the number of beds sold in town and the number of visitors certain events brought to the city, we would have done even more!
Know Your City!
Sincerely yours, Patronim.com
Finally a cleaner you can trust!