Making Money With Airbnb In 2024: Why I Rent Out Our Guest Room - Financial Panther (2024)

It never really occurred to me how much space in a typical house goes unused until my wife and I moved into the four-bedroom house that she’d bought back when she was starting graduate school (back then, she lived in one room and rented out the other three bedrooms to roommates, so she was house hacking before I even met her).

As a renter, we’d never lived in an apartment bigger than 800 square feet or so. Our smallest apartment – where we found all of that sweet trash – was about 600 square feet.

At the beginning of 2016, the two of us moved back into this four-bedroom house that was probably double or triple the size of any apartment that we’d ever lived in. It seemed like a waste to have so much space for just two people. But we didn’t want to get roommates either. That’s when we decided to try out our hand at making money with Airbnb.

Are You Really Using All Of Your Space?

Moving from our small apartment into a pretty big house showed us how much of our home was basically going unused. When you think about it, most people probably need just a few parts of their home – a spot to watch TV, a spot to sleep, and a spot to eat and cook. Maybe you work from home and need a spot to work also.

A while back, the Money Wizard wrote about a UCLA study in which researchers plotted the location of family members in a typical house. The researchers performed a sweep of the house every 10 minutes, then plotted each family member’s location. Below were the results. As you can see, the majority of the time, people hung out in the kitchen or family room. Many other rooms basically went unused.

What this means is that, for most people, a house isn’t being used to its full potential. Most of the time, you’re not really paying to heat or cool yourself. Instead, you’re paying to heat and cool stuff that’s sitting in unused rooms.

And the absolute biggest waste of space has to be the guest room! It seems like everyone with a house has a guest room these days. People decorate them, keep them clean, and put nice stuff in them. And then these rooms only get used a handful of times per year. We were no exception.

The thing you can take away from this post is that, if you have a guest room, you’re sitting on a potential income-generating portion of your house! Your home is likely your biggest asset. And figuring out a way to monetize it, even just a little bit, is an easy way to put that asset to use and offset some of your living costs. It’s also a good way to fix the problem of having a house that’s too big for you by making sure unused space actually gets used.

I knew about Airbnb, but before signing up, I’d only used it once as a guest and never as a host. Still, I’d always been interested in the concept. And I hated that I had all this extra space sitting unused.

So, in April of 2016, I took some pictures of the guest room, put up a listing on Airbnb, and my wife and I began to welcome our first guests. We hosted guests for almost four years until the birth of our son put an end to our shared hosting experience (we’ll still try to rent out our home when we travel though).

The Advantages of Airbnb

I’m a big fan of the sharing economy. And Airbnb comes with a lot of advantages that you can’t get from a normal roommate situation. These include the following:

1. It’s Better Than A Full-Time Roommate

The traditional way of monetizing your home would be to find a roommate. The problem with having a roommate is that you lose a lot of flexibility. If you want your house for yourself, you’re stuck. In contrast, with Airbnb, all you need to do is block out those dates on your calendar.

I think there’s also a big mindset shift with an Airbnb guest as compared to a roommate. One of the things that my wife hated about living with roommates was the fact that her roommates had their stuff in her living room and kitchen. It’s not necessarily that her roommates were messy – most of them weren’t. But when you have multiple people living in one house, it’s really hard to keep the place free of clutter. A roommate sees your house as their house – and that’s fair. They’re living there for an extended period of time.

It’s a totally different experience with an Airbnb guest. That’s because there’s a general understanding that it’s your house and the Airbnb guest is just that – a guest. When I’m a guest in someone’s home, I tend to treat the home with a ton of respect. I won’t walk around someone’s house tracking mud or leave my stuff around or make a ton of noise at night. I’ve found that most Airbnb guests think the same way. When they stay in your home, they’re super respectful – decidedly so, in fact.

Another unexpected bonus with an Airbnb guest versus a roommate is the fact that Airbnb guests typically spend very little time in your house. Someone booking a guest room on Airbnb is typically coming into town for a specific reason. Since my wife and I live close to a college campus, almost every guest that stays with us is coming into town for a conference or for school interviews. We don’t see them very often because they’re busy doing things and most of the time, they only come home to sleep.

2. You Earn Way More Money For Less Time

This is pretty expected, but renting out a room on Airbnb brings in much more income compared to renting that same room to a traditional renter.

If you’ve followed my side hustle reports, you know that in months when I’m fully booked, I can bring in well over $1,000 in a month. A room in my house would probably rent for around $600 or so per month if I rented it out to a traditional roommate. I can bring in that same amount in about 12-14 days on Airbnb.

3. You Have Way Less Wear And Tear On Your Home

A lot of people find this surprising, but an Airbnb guest actually results in less wear and tear on your home compared to a traditional roommate. That’s because most Airbnb guests are only in your home for short periods of time and the vast majority of guests are just looking for a place to sleep.

Unlike a traditional roommate who will actually live in your home and use your kitchen and other things in your house, an Airbnb guest might only spend a few hours at your house during the course of their stay.

4. Your Overhead Is Low If You’re Renting Out A Room In Your Home

One issue a lot of people have with Airbnb is that it takes a lot more time and overhead to run an Airbnb as compared to a traditional rental. This is definitely true if you’re renting out an entire house or apartment that you do not live in. It can be a time-intensive process to clean a large space between guests and get a place ready for the next group, not to mention if you’re renting out an entire home on Airbnb, you’ll probably need to invest some money in purchasing furniture.

But when you’re renting out a room in your house on Airbnb, the overhead is minimal. There’s very little extra utility use, at least not enough for me to notice any real difference in our electricity or water bill. We’re also just using furniture we already had – furniture that I bet you already have too.

The only overhead we really have is what it costs to wash sheets and towels. To minimize these costs, we have multiple sheets that we’ve earmarked for our guest room. Doing this allows us to stagger our laundry so that we can wash most of our sheets with our regular laundry.

5. Your House Will Never Be Cleaner

I think this is the most underestimated impact of renting out a room on Airbnb. Ever look around and realize that your house has gotten pretty dirty? I know that’s what happens to us when we go through long periods where no one is visiting our house. Clothes get left on chairs. Dirty plates start piling up in the sink. Dust bunnies start collecting in the corner.

This all changed once we started renting out our guest room on Airbnb. Suddenly, we needed to keep our house clean! Sure, there’s some work involved in cleaning up our house when guests are coming. But the thing is, cleaning gets so much easier when your house is already clean. I really only have to sweep up our guest room, change the sheets, and make a quick sweep of the bathroom between guests.

I will admit that cleaning is work. But it’s work that doesn’t just benefit our guests. It benefits us too! Our guests get a clean place to stay, and as an advantage, we get a clean house to live in. In a way, it’s like I’m paying myself to clean my own house.

6. You Can Get Freebies!

I love free stuff and the great thing about becoming a good Airbnb host is the ability to potentially get free things from companies looking to advertise their products. This might have been more common in the early days of Airbnb, but I’ve been able to get a lot of free stuff simply because I have an active Airbnb listing. If you keep an eye out on some of the major Airbnb forums, you can often find companies offering to give free stuff to Airbnb Superhosts. As an example, I’ve received boxes of travel-sized toiletries, USB plugs, and smoke alarms.

My absolute best freebies are two free mattresses I received from startup mattress companies. These companies are super popular in the startup world – instead of buying a mattress in a store, you can purchase a mattress online and the company mails it to you in a box.

Since I’m an Airbnb Superhost, I’ve been lucky enough to receive $2,000 worth of free mattresses and pillows from these companies! I guess the idea is that a guest will sleep on the mattress, then consider purchasing it later. I have no idea if that will actually work out, but who cares, free mattresses for me! If I stopped doing Airbnb right now, I’d still get to keep the mattresses. That’s pretty good for me.

I didn’t expect to get any freebies when I first started hosting. But it’s been a nice bonus and I’m always keeping an eye out for other freebies! Unfortunately, it’s gotten harder to find these types of freebies, but it’s still an unexpected benefit that’s worth considering.

In lieu of free stuff, Airbnb also gives you a $100 credit for every year that you’re an Airbnb Superhost. That’s a nice little freebie that you can use too.

But What If Some Crazy Guy Comes Into My House?

The biggest fear that anyone has when it comes to renting out a room on Airbnb is the fact that you’re inviting a stranger into your house. This is a definite concern for sure, but I think it’s an overblown fear. I feel like most people in the world are normal people. And with the way the internet works, it’s pretty easy to figure out who’s coming to your door.

You also greatly diminish the chances that a crazy person comes into your home when you’re renting out a single room on Airbnb. Anyone looking to throw a big party or steal from you or do any other number of bad things is probably not going to do it in a house where the owner is also living in it.

There are other precautions you can take to avoid problem guests. I require all of my guests to verify their identity with Airbnb and anyone that instant books can only do so if they have received a good review and have no bad reviews.

I also always do a bit of background research on each guest that messages me. If they have good reviews already, then that’s great. I’ll also usually do a quick Google search and see if I can see what type of internet presence they have. A professional LinkedIn profile or some sort of work profile is definitely something I like to see.

Finally, you can limit the potential crazies just by chatting with your potential guests. I can almost always get a feel for the type of person coming to my home based on the type of messages they write. If the message is written professionally and explains why they’re coming into town, I’m much more likely to accept the request.

Recently, I allowed instant booking for my Airbnb profile, but I limit the feature only to guests that have received positive reviews from other Airbnb hosts. So far, I’ve had no issues with instant book requests, and actually, I think it’s helped improve the type of guests I get.

In the end, you’ve got to trust your gut. Most people who are crazy won’t be able to hide it. And you’ll probably be able to tell.

More To Come!

My Airbnb experience is far too much to write in a single post, and over the years, I’ve written additional posts about this topic. You can check out some of them here:

• House Hacking With Airbnb – Recapping My Third Year of Airbnb House Hacking
• Using Airbnb To Create Your Home Maintenance Fund
• Earn Tax-Free Airbnb Income With The Master’s Rule

If you have a guest room collecting dust, consider giving Airbnb a try. It only takes a little bit of time to set up and really, if you don’t like it or find it to be uncomfortable, you can just delete your listing. You can’t get that same flexibility with a roommate.

Your house is likely the most expensive thing you own, but it can also generate significant income for you if you are willing to do some research and planning, think outside the box, and use the resources you have. And if you can subsidize the cost of your living expenses, you can make huge strides in your ability to save money and reach financial independence.

If Airbnb hosting sounds like something you’re interested in, feel free to sign up to be a host. It’s a great, low-risk way to try out your hand at house hacking.

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