A data based approach to help you decide if you should AirBnB your extra Seattle property.
It’s 2017. You own a place in Seattle in which you’re not currently living.
You’re thinking of selling it? Or renting it out? But that sounds like a lot of work…
Why not use it as a store room? But you want to make a passive income…
What about AirBnB?
Besides the additional income stream, there are so many advantages of sharing your home on Airbnb.
It’s free to list your property. You can set you own pricing and adjust it as needed. It offers a wide audience. And you can decide on the scheduling.
I’m sure you’re already asking some important questions in your head:
Is Seattle a popular place for AirBnb?
What do people expect from AirBnb?
Would I need to make any upgrades to my property before listing?
What price can I charge for the property I have?
In this article, I answer these questions by using AirBnB Seattle’s listings, calendar and reviews datasets from 2016.
I want to find out if the number of listings in Seattle is growing? Is the availability of listings decreasing due to a growing demand? Is AirBnB in Seattle becoming more popular? Are some neighbourhoods more popular than others? Are people giving more ratings?
According to the 2016 data, the overall occupancy of AirBnBs is showing a decreasing trend across all neighbourhoods.
The data is suggesting that AirBnBs in Seattle are getting less popular. Seattle might not be the best location for AirBnB in 2017.
AirBnB guests expect more of a personalised experience than they would staying at a hotel. There are so many reasons someone would choose one AirBnB over another. A family on holiday want a kid friendly place with a pool. Someone on a business trip would look for a place with a laptop friendly workspace and good internet.
But how do I decide which amenities will make the most impact for my AirBnB? Which amenities are non-negotiable for guests, and which are nice-to-haves? How do I differentiate my AirBnB from the rest so that I can get bookings and make money?
There is consensus between the top performing AirBnBs and overall group of AirBnB listings in Seattle on what the top amenities are.
Over 95% of all listings have wireless internet and heating — these are non-negotiable if you want to enter the AirBnB market. To be a top performer you should probably invest in a good kitchen as this amenity really stood out in the top performers. It could also be beneficial to have a smoke detector, essentials and washing and drying facilities. As long as most of these basic amenities are catered for, your AirBnB should attract customers.
If you really want to stand out from the overall group ensure you have a TV. Also consider making your place Family/ Kid friendly and investing in safety i.e. carbon monoxide detectors, fire extinguishers etc.
It is up to you what you charge for your listing. The best way of doing this is looking for comparable listings to find out what they charge… or you can use a machine learning model!
A machine learning model was trained to predict the price of a potential listing using a combination of features including number bedrooms, property type, room type and neighbourhood. The graph below shows the indicators which have the biggest impact on price. It is clear that your property type and room type have a large determining factor of price.
Let us see how we can put this model into practice by using 3 scenarios and seeing what our model thinks you should charge for each of them:
1. I have a 3 bedroom house in Interbay that I could rent out for a family of 4 with kids. It’s got a great kitchen and washing and drying facilities.
2. I have a bungalow, with no kitchen but it could be good for a group of 4 couples that want a party weekend in Cascade
3. I have a loft that could be perfect for single person on a business trip in Beacon hill, with great internet
These prices make sense. It’s not perfect, but the model can be used to test all sorts of scenarios to get a rough idea of what you should charge.
In this article we answered some common questions about entering the AirBnB market using data and found that:
- Seattle might not be the best location for your AirBnB with popularity decreasing
- If you want to make your place an AirBnB ensure that you invest in wireless internet, heating and a good kitchen.
- Property type, room type, number of bedrooms and neighbourhood are the biggest indicators of price; and can be used in a model to predict what you could charge for your listing.
To see more about this analysis, see the link to my Github available