How your sofa bed can increase returns on your property investment

The design, cleanliness and amenities of your property are just a few examples of what can help your listing stand out as a preferable option to stay for travellers. As you continue to optimize the performance of your rental property and provide your guests with a memorable experience, do not forget about the underestimated sofa bed.

Conventionally, the sofa bed served as nothing more than an emergency piece, simply existing to house that extra guest for a night or two. Most of us would be able to attest to how infrequently our sofa beds have been used by adding the collection of loose change found underneath the couch cushions. However, with the growth of the Homestay industry, the value-added of the sofa bed has also evolved.

Increase your average daily revenue by up to 13% with our rental management services

In London, one to four bedroom homes with a sofa bed have a higher average daily revenue. In other words, you can charge more per night for your property and not suffer a loss in occupancy.”

After conducting an in-depth analysis of Hostmaker properties and Airbnb properties listed in London, U.K., we can determine the value-added for properties with a sofa bed versus those without one. Hostmaker homes with a sofa bed enjoy an 8 to 13 percent increase in daily revenue**. However, pricing your home should never be a game of throwing darts, there are many factors to consider such as season, location, and the number of bedrooms in your property. Thus, having industry leading experts with intricate market knowledge is paramount to determining the optimal pricing strategy for your home.

Is the cost of a sofa bed worth the investment for your short-term rental property?

Yes, absolutely. The upfront cost of a sofa bed might seem daunting, but in today’s market, quality sofa beds come in a range of prices and you do not have to sacrifice style and comfort when considering which sofa bed to buy. Throughout the year, Hostmaker homes have at least a 70% occupancy rate which means you will recover the costs of the bill for a £300 sofa bed in 1-1.5 months, and a £600 high tier sofa bed in 1-2.5 months*. 

4 favourite sofa beds used by our Interior Design Team

Below you will find some of the top sofa beds that have been used by our Interior Design Team in Hostmaker homes. We’ve considered a range of styles and budgets, helping you find the perfect sofa bed for your Airbnb property.

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Design Team Favourite: £800                         £299: The Chou Sofa Bed

£399: The Chou Sofa bed with Storage        £1,000: John Lewis Innovation Recast Sofa Bed

 

Will raising the price of my property dissuade potential customers?

It is a common misconception that charging a higher price for your listing will deter potential travellers from booking a stay at your property. However, our data shows that in general, most hosts on AirBnB undervalue their property listings. This not only highlights the importance of having the right market knowledge to price your home correctly, but equally as important is having knowledge about traveller behaviour.

It is vital not to typecast travellers using Homestay properties as one of the same; each has his or her own preferences and desires when travelling. In fact, travellers can be divided and grouped into different types of segments based on their preferences and needs. Outfitting your home with a sofa bed makes it more malleable to consumer differences, thereby expanding the total number of consumers that would be interested in staying at your home.

For example, one segment of travellers might be a family of four who prefers to travel on a budget. This family might find a two bedroom in your city too expensive and are more comfortable staying in a one bedroom with a sofa bed to save money. This turns out to be a win-win situation for both you and the traveller.

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It is important to note that the features of your property are not mutually exclusive and a sofa bed is only a piece of the puzzle to having a successful property. The features of your home should make your guest feel comfortable when they travel –  from the design, cleanliness, seamless communication and amenities. Hostmaker specialises in property management, making  each property a unique and successful player in every city; bringing you a higher return on your investment. To learn how our team of industry experts can help maximize your returns, contact us for your property assessment.

Posted by Anthony Kuey & Joseba Matanza
Hostmaker Analytics

*Information is based on internal Hostmaker and AirDNA data. All statistics were computed at 95% confidence.
**Total time in months can vary depending on seasonality, property size and location.

Looking to sell your property? Short-let in the meantime and make up to 30% more from your assets

House Yellow Sky

The slump in the UK property market following the 2016 EU referendum has meant property owners and investors are struggling to sell their properties. It’s not just cautious buyers and a drop in properties on the market which is affecting the market uncertainty – house prices are also falling, with Nationwide reporting a 2.2pc fall in annual house price growth.

Brexit and recent tax changes are also making the already volatile market more difficult. Real estate agents are struggling to deliver sales for clients, as interest from both landlords/investors and homeowners drop. Waiting for the right buyer can take months or even years during a difficult time for the housing market – so what’s the solution for property owners who need to leave their home or asset vacant while waiting for a sale?

Some experts may suggest finding a long term tenant, so you can continue to make yields on the property or pay off the mortgage if necessary. However putting the house up for rent can introduce hefty tax penalties and you’ll have legal obligations to the tenants. You need to be ready to sell as soon as the right buyer comes along – and you’d have to give tenants at least 28 days notice to move out.

Alternatively, homeowners or portfolio investors should consider the short term let market, which has a range of advantages. You can keep your property on the market, looking presentable at all times, while earning up to 30% higher yields from short term let prices. You won’t have to worry about guests staying for longer than a week or two, so you’ll be able to hand over the keys to a serious buyer as soon as a sale is agreed.

Why estate agents should partner with Hostmaker

Repeatedly telling your clients that a ‘slow property market’ is to blame for your failure to sell isn’t going to cut it. You need to suggest solutions, and offering short term lets in the meantime while searching for the right buyer can keep clients happy. It makes sense – any vacant property in a prime location is the perfect candidate for a short term let property.

As a professional short term rental service, Hostmaker can take care of everything and deliver superior yields. The dedicated property management team handle all enquiries, home checks and profile management, and can even offer interior design services if the property needs a revamp to make it more appealing to guests. Data-driven pricing strategies automatically maximise rental income, and we’ll keep in constant communication to help you promote the sale of the property. For example, when viewings are booked in we can block the availability of the property, and can return the property at short notice when a sale is confirmed.

Contact us today to find out how we can help estate agents and portfolio owners increase profits during an ongoing property sale.

Your summer-ready short-let property checklist for more 5-star reviews

Van Sky People

The short term rental market continues to be a big opportunity for homeowners and landlords looking for a better rental income, or to offset economic uncertainties.

To make sure that it grows without hiking up the price for local tenants, many cities have introduced regulations. They balance a fair supply of long term housing for residents with a healthy offer of short term lettings for visitors.

For example, London introduced the 90-day cap rule for short term lettings  in 2015, while Barcelona and Lisbon have a licence system in place. Bangkok, on the other hand, simply forbids lets shorter than 30 days.

Data suggests that strict compliance with local regulations has helped Airbnb’s accommodation market share in London to triple in 2017, from 2.8% to 7.6% of overnight stays (the rest being hotels, other homestays, B&Bs…).

To make the most of their 90-day allowance, or simply of their away-time during the holidays, many homeowners and landlords list their properties over the summer months. Indeed, it’s a lovely time for leisure travellers to visit the UK’s capital, and nightly rates for accommodation go up accordingly.

Preparing your property for the high season

Travellers are looking for the perfect family getaway or need short term accommodation to attend weddings, cultural events or some of the many events available over the period. Most properties can expect to be booked full for the months of June, July and August – so how can you prepare for the peak season and ensure everything runs smoothly?

The number of listings on short let platforms such as Airbnb, HomeAway or Booking.com can increase over the summer period, as homeowners rent out their empty properties while they are away on holiday (which means more competition).

Take a look at our top tips to stand out and give every single guest a great experience, so as to get great reviews, and thus great visibility. Here’s what you need to get right to maximise yields and attract more guests for the rest of the year.

1. Safety and compliance

While it’s tempting to dive directly into your property’s interior design or welcome pack, safety and compliance come first. We’ve put together some basic rules to make your short-term rental safe here, but in a nutshell, do consider:

  • fire safety: smoke detectors, carbon monoxide detectors, fire safety check, clear escape route, fire extinguisher,
  • gas safety: regular boiler checks and gas safety check,
  • appliances: portable appliance check,
  • emergency: first-aid kit, emergency numbers available,
  • locks: modern locks or even a smart lock can be great additions.

Always follow guidance to ensure the building is safe and everything inside your property is safe to use. The Fire Safety law applies to all properties where guests pay to stay, so pay particular attention to fire exit routes and evacuation plans, and regularly get electrics tested by a professional.

2. Consider your minimum night stay

Many listings have a two-night minimum stay year round, and this makes a lot of sense for most months. However, during the high season where there is a lot of demand, pushing that minimum higher can be rewarding.

Why not reconsider this for the peak season to maximise your rental income? With more families travelling for leisure and less business travellers, guests are likely to look for longer stays, so consider whether a 3-5 night minimum stay might be more appropriate for the summer months.

Besides, visitors who stay longer tend to spend more in the local area, so you would be helping local businesses in a period that is often difficult for them (as many of their regulars may be away).

3. Review prices daily

It’s peak season, which means reviewing your prices every day becomes even more important. You may already be following our advice on how to best price your short-term rental property, but these elements are even more important in the high season.

Be sure to:

  • check local events regularly, as well as any travel trend which may impact where people wish to stay,
  • check local listings to adapt your strategy accordingly,
  • have different prices for different periods of the summer (Wimbledon, Olympia fairs, festivals…)
  • check your amenities regularly to remain competitive,
  • maybe use a few other platforms to tap into different markets (Booking.com is strong in Europe, while Expedia is the leader in North America for instance).

The pricing team at Hostmaker is especially busy over that period, to help thousands of clients to optimise their pricing startegies.

using data and exclusive algorithms to select the best possible price for your listing. Hostmaker can help you increase income by 30% – and you’re literally not investing any extra money or time.

4. Keep up communications

Communication with guests before, during and after their stay is vital for a five star experience. When hosts are busy they can easily forget to check in on guests to see if they need anything, which is a rookie error. Hostmaker provides 24/7 guest support to make sure guests are left feeling valued and coming back for your superior service.

5. Don’t forget summertime extras

Listings should offer a personal touch for all guests, whether it’s a local delicacy waiting for them when they arrive, or luxurious toiletries to use during their stay and take home. Why not improve these little extras for the summer?

If the temperature rises, setting up a fan in the bedroom is but a small gesture and it can go a long way towards creating the perfect guest experience.

If you need a helping hand during the busy summer season let us know. Happy hosting!

Short Term Rentals VS Long Term Rentals: What’s the Difference?

person holding a key

If you have an empty home then you may be wondering how to capitalise on it. Letting out your property on a short term or long term basis can be very profitable when done right, but it’s also very time consuming. There are also many differences when it comes to income streams and legal responsibilities, so our advice is to do a bit of research before deciding on your letting model.

Update Dec. 2018 / Check out our newest analysis of the best rental strategy for 2019, based on market data!

Continue reading “Short Term Rentals VS Long Term Rentals: What’s the Difference?”