If you’ve ever stayed at an AirBnB, chances are you’ve thought about renting out a place yourself. Or is that just me? Anyway, the idea of buying a cottage or dream retirement spot—a place you’d only use on occasion—and paying off the mortgage with AirBnb earnings seems great in theory. But is it feasible?
Apparently not. According to this post on Reddit, the fact that rental earnings from an AirBnB aren’t tax sheltered is a huge sticking point. The poster in question had a property valued at $280,000 with a mortgage of $150,000. While he was bringing in $28,000 in gross earnings, net profit after expenses was only $12,000—and after taxes that shrunk to $8,000.
While that return isn’t terrible, it’s definitely not great when you consider the sweat equity (e.g. bookings, management, cleaning, changeover of the property, etc.) which, according to the poster, is a fair bit of work.
If you’d like to learn more about this particular scenario—and read some interesting comments—check out the Reddit thread.
So tell me—have you ever tried your hand at renting an AirBnB? What was your experience?