Have you heard about the Airbnb real estate business? Well, it's a new thriving business in the real estate sector that does well in countries that get tourists. Most people call them vacation rental houses because they are seasonal. Some people rent for days and others for a few months.
An excellent Airbnb business plan can help you get high monthly returns once you implement the plan.
This guide will show you how you can succeed in the best Airbnb markets in Kenya. By the end, you will learn the following:
Meaning of Airbnb real estate
Factors to consider before investing in Airbnb in Kenya
The best Airbnb markets in Kenya
How to make money with Airbnb rental business in Kenya
Keep reading to get to the root of this new and booming real estate investment. If you want to succeed in this business, follow this guide carefully.
What is an Airbnb Real Estate Business?
Brian Chesky, Joe Gebbia, and Nathan Blecharczyk, who were roommates and classmates, thought of starting online house bookings in 2008. They opened a website that, till today, allows travellers to book houses when travelling to any part of the world, including Kenya.
An Airbnb is a business that involves renting homes or rooms to travellers or digital nomads. Airbnb has made lives easier for travellers since they will feel at home. They can cook, clean, and do anything, just like they would do in their homes.
Airbnb is a business you can start if you have a vacant house or a room you don't use at home. If you are near tourist destinations, there is high potential growth. This new rental strategy can potentially generate higher returns than average rental properties.
However, you can build or buy rental properties and do an Airbnb business.
A report by the CBK showed that Airbnb business led to a reduction of hotel occupancy by 83.3% in the second quarter of 2020.
Factors to Consider Before Investing in an Airbnb Business in Kenya
Your money is at stake, so you have to make the right moves before investing in Airbnb.
For any business, location is always a crucial factor to consider. In this case, you cannot put up an Airbnb business in rural towns and expect returns.
That's why you should look for locations in tourist attraction areas like along the coast, National parks, and also the Nairobi CBD for those going for business trips.
Your houses should be ideal for couples on honeymoon, families with children, groups of friends, or digital nomads on vacation.
Who are your target clients?
Different Airbnb hosts different types of clients. For instance, you can have single houses for one person or homes accommodating a whole family.
How's your social influence?
You can only run an Airbnb through its website. As a result, clients should get a link to your property details, like what's inside and the cost per night.
Therefore, you should be ready to market your Airbnb on social media or have the best social media influencers to do it. The more your property is visible to many people, the more likely you'll get customers.
Do you have enough capital?
This factor is always a concern for any type of real estate investment. But it's more intense with Airbnbs since you should furnish the house with all household items.
If your clients feel more at home away from home, they will refer your Airbnb to their friends.
Is it a side hustle?
One thing you should know about Airbnbs and real estate is you won't start making profits the following month. It takes a lot of time and dedication to pocket your first rental income.
Therefore, starting an Airbnb as a side hustle is a good idea. When you put in the right effort, you can even retire early.
The Best Airbnb Markets in Kenya
Being Kenya's capital city, Nairobi has thousands of global visitors seeking to close business deals. That fact makes it suitable for Airbnbs for busy business guys.
Since these people are not coming for some kind of vacation, the furnishing of the houses is simple. Most people don't even require a television; a power supply and other essential things are just enough.
Mombasa is the most thriving town in Kenya's coastal region. This town attracts thousands of local and international tourists annually with free and paid beaches.
International tourists visit Mombasa when it's winter in their home regions. In contrast, local tourists visit Mombasa during summer and festive, and Easter holidays.
That means you can rent throughout the year if your Airbnb has the best and most comfortable household items.
Nakuru town mainly attracts tourists who like to see flamingos in Lake Nakuru. It also attracts investors since it's a thriving business community with open-minded individuals.
Always ensure you set up your Airbnb near transport means like road or rail, which will be convenient for your clients.
Kisumu is also among the best Airbnb markets in Kenya. Kisumu city is known for fresh tilapia fish and a breathtaking view of Lake Victoria.
This town also attracts business investors from across the country and other countries. Setting up Airbnb near Kisumu Airport will be an excellent opportunity to land new clients arriving in the city.
How to Make Money With an Airbnb in Kenya
You should first create an engaging listing of available houses to let. You should include as many details about the houses as possible. Details like location, number of bathrooms, and bedrooms are critical.
Create a hosting account on the Airbnb website and fill in your house's details and price. Most people charge Ksh. 3000 and above per night.
Create a reliable calendar to ensure you get clients at the required seasons. In addition, ensure that you always have space during high tourist seasons.
Share a link to your Airbnb houses with your friends and family. Also, ensure you factor in serious advertisement means like using influencers or paid Google Ads.
After you get clients, Airbnb will pay you 24 hours after the client's check-in. You can get paid through direct deposit, Western Union, or Paypal.
To Sum Up,
It's an excellent idea to start an Airbnb business, especially if you already own a home near tourist destination areas. It will be good to earn money from your unoccupied rooms or property.
Frequently Asked Questions
Is the Airbnb business profitable in Kenya?
If you plan your business module correctly, you will surely profit. Locations with numerous annual tourists, like the coast, will bring more profits. For instance, let's say you charge Ksh.3000 per night. If the client stays for one month, that will be Ksh.90,000. Isn't that enough money to pay your mortgage?
How do I find the best Airbnb markets in Kenya?
Basically, tourist destinations are the best markets to set up an Airbnb business. The returns in these towns are insanely high.
What do I need to start an Airbnb in Kenya?
You need to pay a one-off application and annual license fee, register and get inspected by the Kenya Tourism Regulatory Authority(KTRA).