Airbnb hosts make bank in the Twin Cities
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Airbnb hosts in the Twin Cities made 7% more than the typical U.S. host last year, according to company figures shared with Axios.
Why it matters: Renting out your home is a growing way to bank extra income as the cost of living goes up.
What's happening: The national short-term rental supply reached record levels in 2022, swelling 20% year-over-year to 1.3 million listings, per new data from AirDNA, a short-term rental analysis firm.
- The firm found the Twin Cities are an attractive spot for investing in those properties — the metro saw 20% growth in available listings from May 2022 to May 2023, AirDNA tells Axios.
The big picture: Vacation rental hosts are expecting a surge in demand this summer. According to a recent survey from Vrbo, 69% of host respondents expect occupancy to be the same or higher than last summer.
- Also, nine out of 10 say their rates this summer will either be the same or higher.
- "Two-thirds of hosts tell us they’re covering their entire mortgage payment with rental income through Vrbo," company spokesperson Melanie Fish says.
Zoom in: Host Pete Johnson tells Axios that renting out his South Minneapolis home while he and his wife travel is a "great side hustle" — it covers about 70% of their annual travel costs.
- Details: They travel about one weekend a month plus a week or two internationally every year.
Yes, but: Communicating with guests and coordinating services like house cleaning can be stressful, Johnson says.
- Johnson advises wannabe hosts to set boundaries around how long to rent per year — they stick to one booking per month — and to make sure their insurance coverage is in order. He pays an extra $200 rider on top of his existing home insurance policies to rent out more than 30 days in a calendar year.
By the numbers: The typical host in the Twin Cities earned approximately $15,000 in 2022, compared to the national median of $14,000, per Airbnb data.
- Cook, Lake and Brown in Greater Minnesota were the highest-earning state counties for hosts last year, the company says.
- Benton and St. Louis counties rounded out the top five.
- Pro tip: Vrbo hosts can use this resource to help calculate potential earnings.
Be smart: Check local ordinances before listing your home. Minneapolis has added stricter short-term rental rules in recent years, such as limiting owners to one short-term rental property in addition to their homesteaded property.
- Other local officials have considered cracking down. No short-term rentals are allowed in Edina, and earlier this year, Roseville paused licensing new short-term rentals, the Star Tribune reported.
State of play: There were close to 13% more nights stayed at local short-term rentals in May 2023 than 2022, though occupancy dropped as demand grew more slowly, AirDNA says. Supply remains 20% below 2019 levels.
The intrigue: Some apartment dwellers can also get in on hosting. Last year Airbnb announced a new listing service for rental units in partnership with big-name landlords, The Wall Street Journal reported.
What's next: Developer Hines confirmed to Axios' Nick Halter that 100 short-term rental units in its project next to Target Field are going to be leased by Sonder, a startup offering furnished apartments that can be booked online.