Hello,
I’m relatively new to Airbnb hosting and trying to calculate my break-even point. What’s the best way to account for variable costs, like cleaning fees, along with fixed costs like mortgage payments?
Hello, To calculate your Airbnb break-even point, sum up fixed costs like mortgage, insurance, and utilities. Next, factor in variable costs such as cleaning fees, maintenance, and supplies per booking. Divide the total costs by your average nightly rate to estimate how many bookings are needed to break even. For deeper insights, I recommend reading Smarthost's post It covers borough-specific rates and tips on optimizing your listing, which can help maximize bookings and cover costs effectively.
Also, don’t forget to factor in occasional expenses like repairs or replacements. I use a spreadsheet to track all these costs—it helps me see trends and plan better.
To calculate your break-even point, list all fixed costs like mortgage payments, insurance, and property taxes, then estimate variable costs like cleaning fees and utilities per stay. Add these together to determine your total expenses, and divide by the average price per booking to find the number of bookings needed to break even.
When it comes to your break-even point, think of it like solving a puzzle. Fixed costs, like your mortgage or insurance, are the cornerstones—they’re stable and easy to spot. Variable costs, such as cleaning fees or guest supplies, are the trickier middle pieces that shift with each stay. Combine these to get your total cost per month, then divide it by your average nightly rate to see how many bookings you need. It’s a balancing act, but with a bit of tracking, you’ll find your rhythm. This is in general. But in particular, I would recommend you an easier tool, for example Rently.sg where you will be able to do the listing and find a tenant too. Best of luck!