Airbnb Hosts in Hawaii Make HOW MUCH?!

Airbnb hosts in Hawaii make how much

What’s a MILLION DOLLAR LISTING on Airbnb look like? In the video, I show you some top properties in Hawaii. Then, we dive into one that’s for sale RIGHT NOW!

Sure, it’s fun to drool a little bit on properties (mini resorts?) that can make over a million dollars a year as a short term rental. 

And I can’t help myself but to do a bit of that… but in the video we also find a condo in that market in Hawaii that’s for sale right now. 

I dive into the numbers to see if it’s a good investment.

  • variable annual expenses
  • fixed annual expenses
  • acquisition costs
  • loan details
  • revenue details

In fact, you get to see exactly how I look at revenue data and determine what a short term rental can make each year. 

That’s often the hard part for a lot of people because STRs are so seasonal. They go up and down every month. But it IS predictable with quite a bit of confidence. 

See how in the video.


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Expand Transcript

Sup guys, today I’m going to be showing you behind the scenes of how much some of the top Airbnb hosts in Hawaii actually make. And I’m telling you right now, the numbers are going to blow your mind, it is crazy to think how much some people are making on single properties in Hawaii just by listing them on sites like Airbnb and VRBO. In addition to that, we’re also going to do a full breakdown of a property in Hawaii that is currently on the market right now, to see what the return on investment will be like if you were to purchase one of these properties. So we’re going to look at a specific property it’s on the market right now in Hawaii, we’re going to look at how much it would potentially make as a short term rental. And we’re going to run some quick numbers to see what their return on investment would ultimately look like. So if you’re interested in knowing that and you’re interested in knowing how much Airbnb hosts in Hawaii actually make, then stay tuned for this video. Let’s jump right in. So this is a tool that I like to use. It’s called Air DNA. And it’s a really great tool for analysing different properties analysing different areas. And this is a specific market called Kailua Kona in Hawaii. And this is a list of the top properties in that area. Now, if we look at this, you’ll see that the number one top property in this area, their revenue is $1.2 million over the last 365 days over last year. That’s right, this property made $1.2 million in revenue. Now the second runner up only made a measly $907,000. So you know, didn’t even hit the million dollar mark in a single year. So I know, I know, nothing too impressive there. But let’s actually take a look here you can see there are a whole bunch of properties in around the three quarter million and up range. And then as you go further down the list, you get closer to half a million dollars. Just think about that. In most areas, you can buy several homes for that amount of money. And in one year, these homes are bringing in that amount of money. That’s just crazy. I I’ve seen properties bring in 100 $200,000 a year that’s, that’s really normal, honestly, nowadays, not to say that all small properties or anything like that in all markets would do that. But 100 $200,000 a year, that’s relatively common. But I think this is probably the first time I’ve actually seen a market where one of the top properties cracks a million dollars a year. That’s rare. That is just absolutely insane. And for there to be a whole handful of them that are over three quarters of a million dollars in revenue. It doesn’t necessarily surprise me because it’s Hawaii and everything is crazy expensive there. Everything is just insane. And it’s a really established short term rental market. But like still to think that a single property could generate $1.2 million in revenue in a year is absolute insanity. I couldn’t even imagine the level of service. They’re providing the gas when they’re charging $3,600 a night like that, to me is just absolutely crazy. So let’s take a look at the actual listing. This is that one that’s generating $1.2 million grand Balinese entrance here. Yeah, not bad. I mean, it’s a pretty freakin gorgeous, gorgeous property owner no like this one. Just amazing. Yeah, designed in an open floorplan make it perfect for entertaining. Yeah, like this place is stunning. And look at these views like the walls just open right off. You’re on it your private garden oasis that overlooks the ocean like yeah, this is absolutely stunning. I’d be so curious to know how much this property would actually go for. I bet it wouldn’t go for enough that it would make it out rageous like, I’m sure it would go for an outrageous amount of money. Don’t get me wrong, but I think that if you actually ran the numbers on this particular property, buying it and having it rent for $1.2 million a year, I think the owner is doing pretty darn well. Yeah, this is a beautiful beautiful spot. And honestly that’s all the photos they have 20 pictures that really shocked me they must get a lot of their bookings from another channel or something like that. Because it it really surprises me honestly at this place like it’s a gorgeous place and I can see why it would rent for as much as it does at night. But only having 32 reviews and the fact that it’s like it’s a you know, not an incredible listing it’s not like a mind blowing listing it’s only 20 photos for for heck sake. Like it does kind of shocked me that it goes for that it generates as much as it does, but our DNA does tend to be very accurate. Yeah, this is oh my goodness is another insane wants is the second best performing property on the market and is hard to imagine how going going into the hot dog and having that as your view just incred Well, yeah, this place is stunning. I really really like when they’ve got the the full walls that kind of retract away. That would be wild in a storm, but very, very, very cool. Yeah, you got your outdoor shower. That’s really cool. Yeah, the whole place is a little bit dated inside to be honest. Not crazy. Oh, yeah, it’s right on right on a vacation or on on a golf course. So that makes a lot of sense. Four Seasons Resort right down the road. You’re right on the right on the on the ocean, right on a beautiful golf course. Like, yeah, that’s pretty stunning. Oh, wow. And you get access to the four seasons. It looks like you can access their amenities. Yeah, and the neighbor’s pool and hot tub. Yeah, that’s pretty wicked. Wow. Okay. So now we’ve got a good idea of what some of these properties can actually generate. I want to check out this one. I can’t I can’t skip this one. This view is just insane. Just imagine. Yeah, I want to go here. I want to go to this spot. Oh, this is just beautiful. Inside. It’s gorgeous. They’ve got like, top of the top of the top of the line appliances. Just absolutely insane. Yeah. And that view, like, that’s what I would pay just for that view just to hang out on that on that living area there. This place is amazing. So this is what some of the top properties will do. Right? Like these will pull almost a million dollars a year. That’s crazy. Absolutely insane. But what about a more normal property. So like I went and I looked on the market right now. And I saw that there’s, there’s quite a few properties in this same area. And one of them is this one right here. It’s a three bedroom, three bathroom. 1500 square feet. So pretty darn small. It is a like condo unit. And it’s going for $950,000. So just shy of a million bucks. So that should give you an idea of what those properties we were just looking at probably go for quite a lot of money. But yeah, so this is a property three bedroom, three bath, I want to go through and analyse and see how much it would generate. Because it’s, it’s going for $949,000 to purchase it. And then you’ve also got HOA fees of $1,047, which is insane to me to pay $1,000 In HOA fees per month for a building built in 1979. Like that’s crazy. Yeah, $620 price per square foot like this is this is wild. Vance, cool about this one, though, the reason I picked it is because it was it was previously a short term vacation rental with high demand. So that tells me that it’s probably it’s probably possible to licence this thing, again, as a vacation rental, which I know that in Hawaii, there’s a lot of licencing requirements. And so I’d be hesitant to to, you know, dive right into one right off the bat if if we if I hadn’t already researched regulations. So I haven’t researched regulations for this, I wouldn’t obviously put an offer on a property like this without doing my due diligence first. But this is just I want to get one that was likely going to be licensable, just so that we could look at something that would potentially be a short term rental. So let’s go over here and I’ve got a an analysis spreadsheet set up for it, let’s just go and punch in some numbers here. So that we can see how much this property would actually generate from a an ROI perspective. Because if you’re paying almost a million dollars for the property, and then you’re paying $1,000 a month in HOA dues as well as all your other operating care expenses, it’s going to be pretty pricey, you’re going to want to make sure you can actually get an ROI. And my suspicion is that you probably couldn’t get a very good return on this property, your returns would probably be muted, just because typically, in a given area, if you’re if it’s really, really well established for vacation rentals, that makes it more stable. And typically people are willing to pay a premium for that stability. So you end up getting lower returns because you have lower risk. So I find that markets like Hawaii and Florida especially like right around Disneyland, the returns just don’t tend to be quite as good because other people are buying them as short term rentals and because of the decrease in risk, they’re willing to pay a bit more of a premium for it because they’re they’re not you know, it’s it’s already an established vacation rental market. So there’s a lot less risk of like changes in regulation and things like that. So let’s say that we were going to do like to two of the bedrooms is Queen bedrooms and one with two twins so we could accommodate families nicely. One living room, one dining room, one Kitchen. Let’s see how many bathrooms it was three bathrooms, okay.

And then miscellaneous. Yeah, hot tub and sauna to condos. We wouldn’t do anything like that. So pretty inexpensive to furnish or we can furnish it for about $11,000 rehab work. I’m going to assume nothing And because it’s a condo, it looks to be in good shape. It doesn’t look like there’s anything major that would need to be redone. It’s, you know, it’s not the most modern thing ever, but like, it’s certainly not bad. It’s not terrible. Yeah, I’m gonna leave it at zero, obviously, you want to get an inspection, even with the bn condo, I like to get an inspection, you know, call me crazy, just it just to be on the safe side. But yeah, I mean, honestly, it looks pretty straightforward, pretty nice. So, land transfer tax, you’re not gonna be dealing with interior design and photography, I would say, Yeah, you’re still you’re gonna want to budget for it, because like you want to make this play stand out. And then, let’s see, we’re going to skip over our revenue numbers for right now. And we’re going to skip down to here do a 20% downpayment on the property, let’s say a 6.5% interest rate on the mortgage, depending on your on your ability to like what your lender would give you, you might want to adjust that. But let’s say 6.5%, to be to be kind of average. Now, the thing is, I don’t know what cleaning fees in the area would go for. So if I were really seriously looking into this place, I would want to actually call some some cleaning companies in the area, I’m going to assume they’d be pretty expensive, I’m going to assume that cleaning fees will be pretty expensive. And it’d be relatively hard to find help. Because you’re on an island in the middle of Pacific Ocean, like I can imagine it being super competitive, and the rates being low like they would be in mainland. So I’m going to I’m going to assume that probably for this one, you’re going to be about $200 per clean. It might even be more than that. But let’s just say for this 200. And let’s say that your average length of stay is maybe four or five nights. So for a rented week, you’re probably going to be about, like, let’s say $200 per clean, and then like 1.5 cleans per rented week. So it’s rented for seven days, some weeks, you’re gonna have one thing other weeks, you’re gonna have to, let’s just say what $300 per rented week for cleaning. Then you’re gonna want to do your advertising and tack costs. That’s just going to be fear, like management stuff, $500 a year yard in snow you’re not going to have which is nice, because it’s the car, it’s a condo. But you are going to get to pay that nice HOA do of $1,047 per month. So that’s going to you know, you do save a nice $1,200 a year on not having to garden snow, but you pay $12,000 a year for your HOA dues. So that’s not as nice. So $1,047 There, let’s put that in. So equals 1047 times 12. That’s 12 and a half $1,000 In HOA dues. Now, you can definitely get away with having a bit smaller of a maintenance reserve, given that it’s a condo, but I’m going to leave that as is because you’ll still want to have some money set aside a good amount of money set aside for just anything inside the unit that’s wearable stuff like that. But you may you may decide to lower that, because it’s a condo. And in theory, a lot of these, these expenses are going to be covered by the HOA dues. Let’s see here. Let’s go back up and go into electricity, water and sewer cable internet. Let’s see what we’ve got here. So it looks like yeah, monthly association fees, cover insurance and maintenance of the buildings. That’s wild. So comes with insurance. That’s actually pretty good. I mean, see the grounds. I wonder if that comes, I don’t think that would come with short term rental insurance, I could be wrong there. That doesn’t make a lot of sense to me, I’ve never really seen insurance be included in HOA dues. So I’m going to assume and I could be wrong on this. But I’m going to assume that your insurance is still going to be an extra $3,000 a year. But that could actually be pretty reasonable. If it’s if it’s included there that will make I mean more reasonable. You’re still paying $12,000 a month in an HOA or a year and HOA do so. Yeah, and then yeah, HOA fees, they’ve got it separated out here as well as insurance property taxes to 18 a month. So let’s plug that in property taxes equals to 18 times 12. Again, you’d want to just double check that with the with a listing agent before you like during your due diligence period before you actually submit a firm offer. Let’s see here. Yeah. Okay. And then does it mention anywhere like what the what the typical electricity bill is going to be? I don’t think so. So that’s something you’d want to double check on as well just to get a feel for it. What it typically runs from on the property from the from the seller, I’m going to put in the like cable internet, probably going to be about $100 a month. So let’s say $1,200 a year. And then for electricity, you’re probably going to be maybe about, I don’t know $2,400 a year, about $200 a month that could be off And then I’m going to leave that all as is. Yeah. So that’s probably a good idea. Again, I would, I would get a lot of this stuff, a more more firm idea of this from the listing agent going in digging in and getting real numbers. But this is what I would do when I’m just initially interested want to see what the rough numbers come out too. And so you can see here, so like, that’s basically all of our rough numbers except for the revenue. And so now, what’s interesting here is like usually these numbers right off the bat, because I just left, the default number in here is 100,000. And usually, that means that these numbers come up, you know, quite inflate, because we haven’t even looked at this. Yeah, we haven’t looked at the number. But it’s crazy to think that you could buy this property have a bring in $100,000 a year and you’d be basically breaking even, like that’s, that’s wild. And I don’t know that this property will actually bring in 100k a year. So it’s gonna be really, really interesting to see. Guys just want to take a quick break here to say that for those of you watching, who want to build cashflow, and long term wealth by purchasing Airbnb and short term rental properties, there’s a link in the description right down below for a free training that will walk you through my exact strategy for investing successfully in Airbnb. Now, if you’re not ready to actually buy properties, and you want to get started managing other people’s properties on Airbnb the same way I got started and build a full time income managing other people’s properties. There’s actually another free training linked in the description down below as well, that’ll be a really great fit for you. So whether you want to invest in short term rental properties, and actually build amazing cashflow, and long term wealth by acquiring the assets, buying the properties themselves, or you’re looking to earn a full time income managing other people’s properties on Airbnb, we’ve got some awesome trainings that are linked in the description down below, that will definitely help you out. When you sign up for the trainings, we’re also going to send you a few other tools and resources completely for free just to help you get started. Again, the links to sign up are in the description down below. And both trainings and all the tools are completely free. So make sure to register for the trainings, links in the description down below. So let’s go into into Airbnb, here are our DNA story here. And let’s go and look at revenue data. And I’m going to look at and I want to look at Yes, three bedroom properties. And I want to find specifically ones that are going to accommodate, yes, 68 people who’ve eight people in this place will be cramped. I’m going to say yeah, I’m going to say six to eight. I’m gonna say four to eight, actually. Because like realistically, yeah, eight is kind of pushing it for a condo, I would say I wouldn’t go much more than six probably even though it’s got three bathrooms, like, I want to see as well are the bathrooms full bathrooms as well. There’s one full bathroom. Let’s see, does it have a second full bathroom? Man, we don’t even know. So like the other two bathrooms can be powder rooms. And if they are that, Okay, now here’s another. Here’s another one that yeah, there’s one I was laundry and but it doesn’t have a shower. Boy. Yeah, so I’m actually going to assume that it doesn’t have another full bathroom, meaning that I would actually max it at six. So let’s do that four to six people. So there’s 223 of them that are active. And let’s go ahead and download the Excel for that. And let’s look at the revenue numbers here and see how much it would shake out to. And now mind you this is taking into account all the three bedrooms, so it’s not all necessarily just going to be condos, so we have to be mindful of that. Now what I like to do when I run analysis is I like to look at the different trends. So I’m going to look at 75th percentile to start with, or let’s do 50th and 75th. So let’s look at 50th percentile. Let’s look at 75th percentile. And then let’s grab our numbers from 2018 2019 2020 2021. And then

2021 pace. And I’ll talk about more about that what that is in a minute, and 2022 pace. And so what we want to do here is basically it’s real simple, we just want to sum up the 28 T numbers or 50th percentile. So you can see in this column, we’ve got 50th percentile numbers in this column, we’ve got 75th, we’ve also got 25th, and 90th. So what this means is the top 50% of listings that meet our criteria, meaning their three bedroom properties in that area that accommodate four to six people, the top 50% of them are going to be averaged out to these numbers, the top 25% are going to average out to these numbers, the top 10% are going to average these numbers. So you’ll see they get better and better as you go up the up the list. So I want to start at 58. That’s what I like to use for my conservative numbers typically. And so in 2018 That was basically all of these numbers here. And then in 29 it and it was from January until December there. And then in 2020, it’ll be really interesting to see what happened here in Hawaii during 2020. Because I would suspect that it being mostly international people coming in or most of you like flying in that it would drop down. Yeah. So you can see that it’s one of those markets that got hit with, with the pandemic and everything where it did actually drop. And then 50th percentile for 2021, I would assume is going to be low again. Wow. So 2021, it actually jumped up massively. So I would imagine that’s people that, that weren’t able to travel internationally. And so they travelled domestic, but they hopped on a flight to do it, which is interesting, I wouldn’t have thought that many of you would have been hopping on flights. But I guess if it’s if it’s a domestic flight, there’s not really much better place to go than Hawaii. So that that doesn’t make sense. And so in 2022, I bet they’re just absolutely exploding. So what I like to do here as well, is I want to just look at and these are the 20 these are than the 75th percentile numbers. But now I want to see, so we’ve got data right through November 2022. So I want to take the data from 2021 through November. And then I also want to take the data from 2022 through November so that we can see how 2222 is shaping up compared to 2021. So you can see oh, wow, it is doing way better and 2022 already. That’s crazy. Yeah, now let’s put these into dollas. Okay, so we’re already seeing a jump right now of let’s say, let’s do this divided by this, that’s a 33% jump. So it’s basically 134% of last year. So we can assume that 2022 assumption would basically be equal to 2021 times 134%. And then we can just do this as well equals this times this. So Holy smokes. So basically, what this is looking like is that these properties, these three veteran properties are pacing right now. 75th percentile is pacing and 2020 20 and 2022. To do $174,000 in revenue, that is mind blowing. So you can see like, basically, these properties in this area, that three bedroom properties that accommodate four to six people, for 2022, they’re right now pacing to hit $174,000, the average property, so the average of them in the 75th percentile is going to hit $174,000. In bookings in 2022. That’s crazy, I have not seen a single other market and all the analyses that I’ve done that has a massive jump in 2022, like this one, I have to assume the only thing I can think of that would be causing this is that so many people are doing destination weddings in Hawaii. And I know there’s a huge backlog of people wanting to get married that are now getting married in 2022. maybe that has something to do with it. Because I know Hawaii would obviously be a really big wedding destination. Maybe it’s just like travel opening back up like that’s, that doesn’t make a tonne of sense to me to be honest. But especially this massive jump like we’re looking at almost double, like that’s a 75% gain over just a few years ago. And it’s a 34% jump from last year. So just compared to 2021. It’s doing 34% And better than it was. That’s crazy. And that’s a decent number of listings to like there’s 223 active listings in that data set. So it’s not like a really small data set that’s getting skewed by a few outliers. Like those are just crazy numbers that they’re pulling. And so if we were to operate under this as the assumption, then we do $174,000. And we plug that in here. And we say okay, it’s gonna do $174,000 in revenue, and then let’s just see what the occupancy would be. occupancy. Yeah. 100% basically. So, yeah, I mean, we can we can specific we can specify here three bedroom properties that accommodate four to six people, but I assume we’re pretty much just going to be I assume we’re pretty much just going to be at 100%. Basically, yeah, let’s just let’s just put in honour percent just for just to keep the numbers relatively conservative, not because 100% is a conservative number because with this spreadsheet, the the higher the occupancy is, the higher The cleaning fees are going to be that’s, that’s how it factors in so you’re actually keeping your overall projections more conservative if you keep your occupancy rate projected higher rather than lower. And so you can see that when it pulls those numbers that the property will do insane. It’ll do 34% cash on cash return. That’s awesome. But the question is, will it actually do those numbers? I would never project based on that. Just given that it’s such a huge anomaly of the year for it, I would be looking at like, does it do well, at 130,000, this would be like the absolute best case scenario. But I would look at this more as my moderate scenario would be like, right around, honestly, right around 100. I even think 130 is a bit aggressive, because you can see it’s a really stable market. Like year to year, even with COVID, it didn’t really change too much at the 75th percentile, it jumped around a bit more at the 50th percentile mark, but you’re basically at $100,000 is what you’re what you’re doing. And so if you if you see here, like in a moderate scenario at 100, let’s say 130,000, then you’re looking at more like a 14% cash on cash return. And so that’s not bad considering it’s a really stable market. Considering that like, you know, it’s a premium market, I wouldn’t be too upset about getting slightly below 15%. Normally 15% cash on cash is my bare minimum that I would accept on a deal. But for something like this, I’d probably take it. However 130, I don’t think is by any stretch, the worst case scenario 130 is like is still a relatively aggressive, good scenario. Because if you look here, like I think we’re really probably going to be closer to 100k. Once things kind of stabilised more. Now, that could be me being overly conservative, but not at 100k. Like you’re breaking even. And so certainly, if you were if you were any worse than the 75th percentile, you’d be losing money, right? Because like even this year, like even with it being an anomaly year, at 98k, you’re you’re you’re gonna be losing money, right? Like if this thing brings in $98,000, which is the 50th percentile data for this year, you’re losing money. And that’s an anomaly year, if you’re down at $73,000. Like it was last year, which I again, I still think is an aggressive worst case scenario. I think the worst case scenario really is closer to about 60. But if you’re even at $73,000, then that as a worst case scenario, not acceptable. You’d literally be be negative $25,000 a year. That’s a lot to have to float every year, just for something that shouldn’t be making you money. So based on these numbers, I don’t like it at all. Yeah, I wouldn’t be into this property specifically. It’s really interesting. I don’t know, I hope you got value, let me know, like, let me know in the comment section, if you thought this was interesting to know, because I just wanted to run an analysis like this. Now we could dive in deeper as well. And look at okay, you know, what kind of properties are actually pulling those numbers? Like if we look at three bedroom properties here, let’s do it. Let’s just jump right in and see, okay, if we look at the three bedrooms, and let’s zoom in a bit more here. Well, how many of them are similar condos that are actually bringing the numbers that we’re bringing in? Or that we’re projecting bring in? Like, if we’re if we’re figuring we’re gonna bring in about if we’re figuring around $100,000? Let’s find some property. So here’s one, right, this is a beach house oceanfront. It was veiled. 325 days last year, three bedroom, three bath, there’s one accommodates 10 people, but it brought in $120,000. So this is that hard. $20,000. Mark. Now it’s over the last year, which we saw it did really, really well. And let’s see, let’s see how this property compares to the one that we’re looking at.

Way bigger, way nicer, right. So like, yeah, it’s, you know, I would change up a few things decor wise, but like way, way bigger property. And it looks like yeah, this is a standalone property, not a condo. So when you start actually digging into the the real comps for the property, you you start to discover stuff like that. Here’s another here’s a three bedroom, three bathroom condo, or a three bedroom, two and a half bathroom condo. It brought an $82,000 Over the last year, and it was available two to three days of the year. So I don’t love that one, just because it’s not available enough for us to really draw conclusions because two or three days we don’t know how it would have done over the remaining days. Here’s one three bedroom, two bathroom accommodate six people it was available 317 days last year over last year, and it brought in $91,000 in revenue. Poof. So this is again, this is a full home, right? This isn’t a condo, much bigger, much more spacious. So the prospect of this one doing 175,000 Like this property that we’re looking at doing 175,000 is not looking really good. It looks more like it’ll do right around here and there you’re going to be losing a lot of money. So pretty cool let me know your your your thoughts in the comment section down below if you liked this video if you enjoyed it if you got value from it, then drop a like on the video it does help me out tremendously with growing the channel. For me, I found this really fascinating. It still blows my mind that some properties are able to bring in a million dollars a year on Airbnb. It’s so crazy to think that and really interesting. I have a meeting to review some properties in Hawaii. If you have a property in Hawaii, let me know in the comment section down below as well. If you have a vacation rental in Hawaii, I’d love to know how it does if it actually gets ROI. Do you have experience in the Hawaii market? I’d love I’m just very curious about it. So I’d love to know what kind of returns people typically get. This was obviously just one property at random that we picked. But I’d love to know how people are actually performing out there. So anyways, thanks so much for checking out the video. If you liked it, make sure you give it a thumbs up. Make sure you subscribe to the channel to stay up to date with the two new videos we post every single week. And with all that said, thanks for watching the video and I’ll see you in the next one.

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