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Things are really looking up for the Jamaican Airbnb market. It seems that everybody is getting into that business these days. Property owners who used to provide long term rentals are switching to the more lucrative short-term rental or home sharing market.
Even the government of Jamaica is excited at the economic prospects from the fast-growing Airbnb market.
So, how do you like to get your foot in the door and enjoy the benefits of having your own Airbnb business in Jamaica?
Not sure what Airbnb is? It is a platform operating online is located in San Francisco, California. The Airbnb website allows ordinary people to list their homes, villas, rooms or unique accommodations to visitors for an agreed price.
Essentially, all it takes is that extra space you are not using – convert it into a short-term rental for visitors. The Airbnb opportunity is great for homeowners who have a spare bedroom or two that won’t be used for a while, the empty nester, and the owner of a vacation or extra property.
How hard can the Jamaican Airbnb be?
By the sound of it, getting into the home sharing business is not hard at all. There are tons of opportunities in Jamaica Airbnb market for home sharing to grow.
After all, Jamaica is a popular tourist destination that attracts visitors from different countries who love the Jamaican vibe. Indeed, many tourists are repeat guests.
Hosting on the Jamaican Airbnb
It is not difficult to become a host on Airbnb as long as you have even a room to spare. Once you register on the Airbnb site to become a host you have full control over the price for your space, the rules visitors or guests must observe, how you or your representative interacts with the guest and the availability of your property.
Depending on the website you sign up with, you may get insurance coverage for your property. This coverage is protection against property damage and accidents guests may suffer.
Guests are Prescreened
Of course, you would need to ensure that the guests you receive are trustworthy. A reputable home sharing site will screen the prospective guest for you so you don’t have to be concerned about their character – and how they will treat your property. Information typically required from prospective guests include a verified email address and a confirmed telephone number. You can, if you choose, require additional information such as a recommendation from other hosts and verified identification.
What if you are still uncomfortable and want to further check out the potential guest before committing your space? A reputable Airbnb site will allow you to talk with the potential guest through their secure messaging tool for as long as takes.
Furthermore, you have the added protection of requiring identification from guests during the booking process. You can also review the reservations ahead of the scheduled date of arrival and reserve the right to refuse guests who may be suspicious.
Hosts with good reputations do well
Since you are in control of your space and what goes on in it, you can insist that guests abide by your house rules or risk termination. So, if you are not tolerant of smoking and certain events on your property, you are free to make it known to the potential guest during the booking or reservation process and get their agreement.
You can also research guests who have used an Airbnb service before through reviews from their former hosts. Hosts who have been in the Airbnb business also have reviews left by guests that potential guests can look at. If you are just starting out, you won’t have guest reviews yet. You must pull out all the stops to make a good first impression.
The reality of the Jamaican Airbnb game is that hosts with good reputations do very well.
Hot investment niche
The Jamaican Airbnb niche has become a hot cash cow for the astute Jamaican investor who has taken the opportunity to snap up income properties and list them on the Airbnb websites. Persons have even paid off mortgages from going the Airbnb route. The short-term rental income in US currency has been a significant income stream for these property owners.
So strong is the income potential of Airbnb that a recent study on the impact of Airbnb in developing countries, presented at the UNWTO Sustainable Tourism Conference in Montego Bay in 2017, suggests that “up to 97 percent of the price of listings goes into the pockets of hosts”. Hosts in developing countries worldwide have pocketed more than US$10 million in 2017.
Persons have gone as far as listing their homes on Airbnb sites and renting accommodations elsewhere to live in, or “kotch” with friends and relatives. This they do while their homes earn cash from a tidy flow of guests. If you are up to it, you can use that spare bedroom for short-term guest accommodations courtesy of Airbnb. You must prepare to share your personal amenities – kitchen and bathroom – with strangers.
The explosion in the number of Kingston and St. Andrew based Airbnb hosts can be traced to the strong demand for space from first- and second-generation Jamaicans and their children, who come to the island for the Christmas season, for funerals, weddings, and vacations. In other destinations, like Ironshore in Montego Bay, the Airbnb explosion has caused a revival in the popularity of villa accommodations that had suffered a blow by the growth of the all-inclusive hotel market n previous years.
At last count (2018), Airbnb listed approximately 4,000 Jamaican properties. Furthermore, hosts earn an average of US$2,500 each year.
Data from the Airbnb platform shows growth in the number of Jamaican hosts and property listings. The number of Jamaican hosts in 2017 reached 3,100 which was more than the 2,300 hosts in 2016. The number of properties listed in 2017 rose to 5,900 from the 4,000 figure in 2016. Use by visitors increased from 32,000 in 2016 to a staggering 59,500 in the space of a year.
This growth pattern is great news for persons wishing to invest in this game-changing endeavour. Coincidentally, the tourism market is experiencing similar growth – of more than 5 percent per year. The outlook for visitor arrivals in the medium to long term remains positive.
For many Jamaicans, the Airbnb solution is just what is needed to shore up a nest egg with a second source of steady income.
The Downside of Airbnb
But there is a downside to all that glitters.
The Airbnb movement in Jamaica has brought with it some problems that are hard to overlook. Persons of questionable character are entering the safety of Jamaica’s gated communities and not everyone is happy about this. If you live in a gated community, be prepared for complaints from neighbours about your guests and their shenanigans.
Also, you may need to check in with your by-laws to ensure that you are not potentially operating in breach of the rules governing your gated space.
Hiding Place for Fugitives
Without effective checks and balances in your operations, it is possible to harbor cash-rich criminals who seek short term rentals to hide. Even as Jamaica’s law enforcement seeks to crack down on scams and human trafficking, it is possible for fugitives to seek temporary shelter within the ambit of a Jamaican Airbnb.
You might be confident in your ability to sniff out potential criminals to avoid them. But it is better to be safe than sorry.
Hike in Rental Prices
An actual downside that has already shown its effect is the hike in rental costs islandwide. A quick browse through the daily newspapers for homes for rent will turn up two glaring issues. The first is that home prices have skyrocketed. The second is that prices, especially in prime real estate, are quoted in the US currency.
From a rational money-making point of view, it is not good business to rent a two-bedroom apartment in a prime residential community over the long term for US $1,500 per month. Not when the same property can fetch US$500 per night in short term rentals. This means university graduates, young professionals, and even working persons with families will be hard pressed to find a decent home in the Corporate Area that they can afford. Worse, it is proving difficult to find affordable space that property owners are willing to let for the long term.
That said, Jamaicans of every stripe are cashing in on the Airbnb market. The depressed community of Trench Town is one of a growing number of communities that have already grabbed the opportunity to list on Airbnb and receive guests. The opportunities for short-term rentals during special music and cultural events are tremendous.
Government is on Board
On August 16, 2018 Jamaica’s Prime Minister announced that hosts of Airbnb properties in Kingston earned a cool US$2.4 million in 2017.
Jamaica’s Minister of Tourism is on board, having signed an agreement with the operators of the Airbnb platform. According to Airbnb’s Shawn Sullivan, the Public Policy lead for Central America and the Caribbean,
“Airbnb travelers seek unique and authentic travel experiences and Jamaica offers just that.”
So, there is agreement on both sides that Jamaica is good for the Airbnb business. The Tourism Minister acknowledges that Jamaicans are buying into the Airbnb concept and are opening their homes to visitors in larger numbers. They are also earning handsomely as a result.
Tax Revenue Potential
Jamaica also stands to benefit from the tax revenue to be raised from the Airbnb operations on the island. According to the Minister of Tourism, Hon. Edmund Bartlett as reported in the Daily Gleaner on October 31, 2018, plans are being made for Airbnb platform to pay over contributions to the Guest Accommodation Room Tax (GART).
Minister Bartlett acknowledges that Airbnb has conceded its obligation to pay the requisite Jamaican taxes as a business with interests in Jamaica. In the short term, arrangements surround the entity’s contribution to the GART.
However, the Tax Administration Jamaica clarified that the Guest Accommodation Room Tax is payable on ‘occupied guest accommodations.’ Such accommodations include bed and breakfast, apartments, villas; motels, resort cottages; guest houses and timeshare facilities. Hence, the roughly 4,000 Jamaicans who host guests under Airbnb arrangements may contribute to the GART if Airbnb passes the costs on to them.
More Airbnb Tips
To top it off, Alica Lyttle, CEO of POW! Social Media and Internet Income Jamaica shared these five tips for getting into the Jamaican Airbnb market.
- Become a host. This is the most viable way to earn from the Airbnb platform. While it requires a high initial investment, the rewards are high and well worth it.
- Even without an entire property to list, you can list a private room for short-term rental. You may offer a room with own amenities (kitchen and bathroom) or just the room.
- You could be enterprising and find homes for rent that you can discuss with the landlord for agreement to list it on Airbnb. In this case, both you and your landlord will benefit as long as the landlord agrees for you to sub-let the property to Airbnb guests.
- Don’t have a property of your own? Offer to co-host by helping hosts of Airbnb properties with customer service or promotions. These co-hosting services are billed within the Airbnb platform. You and the host (property owner) would need to agree on your rate, which is usually between 10 and 20 percent). You get paid automatically once the guest pays.
- Furthermore, if you are creative and talented, you have the option to offer experiences for guests using the Airbnb platform. Musicians and performers could offer musical experiences or studio jam sessions. If you are knowledgeable about hot spots and nightlife, you could offer that service to Airbnb guests as well.
Are You Ready?
Are you excited yet? Ready to start? The first step is to create an account with the Airbnb platform. Select whether you have a property to list, providing co-hosting services, or delivering an experience.
Getting paid from the Airbnb platform is facilitated by Payoneer, Paypal, or the Western Union. To stand out above the crowd of properties now on the list, you would need to offer a different experience, or go above and beyond to deliver the best quality services to your guests.
Encouragingly, there are other sites you can collaborate with including Innclusive.com, Home-Away, and Bookings.com.