How Airbnb hosts make bank in Washington
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The short-term rental market is heating up as summer travel spikes.
Why it matters: Listing your primary residence as a short-term rental is one way to bank supplemental income as the cost of housing rises across the District.
- Airbnb hosts in D.C. made 29% more than the typical host in the U.S. last year, according to company figures shared with Axios.
State of play: Short-term rental (STR) supply has shrunk 6% year-over-year in D.C., and is down 32% from May 2019, per AirDNA data shared with Axios. Supply changes are largely due to tighter STR restrictions, according to Madeleine Parkin, an AirDNA spokesperson.
Yes, but: Occupancy in D.C. reached 74.4% in May, up from 72.3% from May 2022.
- Demand for STRs continues to grow, but supply is limited.
Zoom in: Dawn Reeves renovated and added a separate entrance to the basement of her Takoma Park, Maryland, home in 2020.
- She and her husband listed their basement on Airbnb earlier this year as a way to save for their son's college tuition.
If you're considering becoming a host, here's what Reeves has learned so far:
- It's time-consuming. Reeves does the cleaning herself, which takes about 2.5 hours plus three loads of laundry each stay.
- Guests can be difficult. If a guest does threaten to leave a bad review and wants an immediate refund, call Airbnb, Reeves says. They can help you navigate the situation.
- Do your research. Initially, Reeves collected quotes for cleaners. Most charged around $75 for the clean, but with an average nightly rate of $85, Reeves said they wouldn't have made any money if they hired a professional cleaner.
- Track income for taxes. Montgomery County collects a tax, and Airbnb pays it for you, Reeves said. But you're responsible for income taxes. She budgets about 35% of earnings for taxes.
Of note: In D.C., your STR or vacation rental must be your primary residence; it can't be an investment property.
- You need an STR or vacation rental license, and can rent your property for up to 30 days with that license.
Bottom line: Listing your home as an STR is a way to bring in additional income, but it's not a get-rich-quick scheme.