Completely Free & Easy To Use

ONLINE AIRBNB ESTIMATOR

Find Out How Much You Can Make On Airbnb With This Free Online Airbnb Estimator

Are you planning to buy a property to rent it out on Airbnb? Wondering how much you would make with your short-term rental? Our online Airbnb calculator can help you with that!

Airbnb investing can be a very profitable business if you buy the right property at the right price. But reviewing properties can be difficult and time consuming and not everyone knows what to do and what to look for. So if you want to quickly know if your Airbnb investment will be profitable and estimate how much your rental investment can generate over the years, check out this online spreadsheet.

Our Online Airbnb Estimator is all about that: running numbers for you so you can rapidly identify great properties and avoid bad investments.

And if you’re looking for additional features not available online, check out our Airbnb Calculator For Excel. It includes full 30-year forecasts, a maximum purchase price estimator, a scenario analysis tool, income and expenses tracking features, a peer analysis tool, plenty of reports, and so much more!

How to use the Online Airbnb Calculator

Using the calculator is easy. Simply enter your assumptions in the blue cells and the calculator will run the analysis for you.

How to fill out the Online Airbnb Estimator

The online Airbnb estimator is composed of 4 sections:

1. Property Acquisition Assumptions

This is where you will enter your assumptions regarding your short-term rental property. It includes 3 sub-sections:

Purchase Assumptions

Enter your property purchase price as well as the various costs associated with this purchase (repair costs, transaction costs, holding costs and furnishing costs). If you plan on financing some of these costs with debt rather than cash, enter “1” next to the related amount.

  • Note: Holding costs refer to the cost of holding a property before renting it. For instance, you may have to spend a few weeks renovating or furnishing the place before it’s ready for your next rental, so costs such as utilities, insurance, HOA, etc. that occur during that period would be added to that category

Enter the estimated after-repair value (or ARV). This value will be used to calculate certain financial metrics. If you didn’t improve your property or make any repair, simply enter your property’s purchase price here.

Timing Assumptions

Enter your expected property purchase date and your holding period (i.e. how many years you will keep the property). If you don’t plan on ever selling the property, just enter 30 (which is the maximum number of years forecasted by the estimator).

Property Value Assumptions

Your property will likely increase in value over time. To account for that upside, indicate how you wish to calculate growth over time. Two options are available:

  • Appreciation Method: a fixed appreciate rate is applied to your property’s value every year until sale.
  • Capitalization Method: Property’s value is estimated using a defined capitalization rate on your property’s Net Operating Income generated during the year of sale.

Don’t forget to also enter your expected selling cost (as a % of your property value at sale). Although it varies from one property to another, market standard is around 7-8%.

2. Financing Assumptions

Assumptions such as down payment amount (as a %), interest rate, loan term, etc. should be entered in that section.

If your loan has an Interest-Only period (not standard), enter the applicable period in that section.

Other parameters include closing costs (related to the financing itself only), Private Mortgage Insurance % (PMI), max Loan to Value (LTV) triggering PMI (usually set at 80%), reinvestment rate (i.e. rate of return at which the cash flow generated by your property over time is reinvested at).

The estimator will automatically calculate your monthly and yearly financing payment, composed of your mortgage payment and loan insurance payment, if applicable (i.e. if PMI is active). It will also generate a Uses & Sources table that shows where the funds are coming from (i.e. cash or debt) and where they’re going (purchase price, acquisition costs, financing costs, etc.)

3. Rental Income & Expenses Assumptions

This section is divided in 5 categories:

3.1 Rental Income

Enter your expected nightly rate and occupancy rate. As Airbnb and short-term rentals tend to be cyclical throughout the year, the Airbnb estimator adds the ability to adjust both metrics on a month to month basis. For more flexibility, the spreadsheet also enables you to create up to 4 scenarios / profiles to see how your property would perform using a different set of assumptions.

  • Flat Case: Assumes the same metrics, regardless of the month, from January to December.
  • Low Case: Use this profile to create a “downside” case where nightly rate and occupancy rate are lower than normally forecasted
  • Upside Case: Use this profile to create a scenario where nightly rate and occupancy rate are higher than normally expected
  • Custom Case: Alternative case to run additional custom scenarios

3.2 & 3.3 Operating Expenses

Enter up to 9 fixed operating expenses (i.e. entered as a monthly $ amount) and up to 9 variable operating expenses (calculated as a % of Gross Rental Income).

Don’t forget to also enter a % for capital expenditures (or “CAPEX”), which refer to big-ticket items that need to be replaced every so often but not every month or year (such as roof, appliances, driveways, plumbing system, or other large infrequent items). Market standard is to usually assume between 7% and 10% of your gross rental income.

3.4 Long Term Operating Assumptions

Enter the nightly rate increase (or decrease) expected each year as a percentage (a good proxy is to use average inflation as a starting point).

Enter similar assumptions for “Other Income”, “Additional Guest Fee” and “Fixed Expenses”, as applicable. A good rule of thumb is to use a similar growth rate for both nightly rate and fixed expenses (i.e. the idea being that income and expenses will grow proportionally over time).

3.5 Airbnb Assumptions

Enter the assumptions related to the Airbnb platform itself. The Host service fee is usually around 3.0% while the Client Service Fee is usually 14.1% (in the U.S.). Most likely, you won’t need to change these figures but take the time to double check these figures for your own rental and location.

Indicate the average number of nights per booking (in order to calculate aggregated cleaning fees over a full month period) and enter an additional guest fee if desired.

4. Scenarios

As mentioned above, our online Airbnb estimator can run up to 4 scenarios based on different monthly nightly and occupancy rates. Assumptions for each of the scenarios should be entered in this section.

5. First Calendar Year – Monthly Estimates

This section will show you what the first year of operations would look like based the operational and financial assumptions entered in the previous sections.

The estimator will automatically calculate net operating income as well as expected cash flow, on a monthly basis.

This section also includes a “Client View” which shows how much your short-term rental would cost to your clients (both on a consolidated monthly basis and on a per night basis).

What financial metrics are calculated?

This free short-term rental calculator will calculate 12 financial metrics, including:

ARV Capitalization Rate (“Adj. Cap Rate”)

Calculated as Annual Net Operating Income / After-repair Value. This ratio is an estimation of an investor’s potential return on investment. It’s an important ratio but it has its shortcomings:

  • The Cap Rate only reflects a limited period in time (i.e. the 12 months of net operating income used for its calculation)
  • It does not take into account leverage and does not include any mortgage payments

Capitalization Rate

Similar to the previous ratio but calculated based on the Property purchase price rather than its After-Repair Value. It has the same shortcomings. More about the Capitalization Rate

Cash on Cash return (or Return on Investment)

Calculated as annual pre-tax cash flow (year 1) / Total Cash Invested. More about the cash on cash ratio

Internal Rate of Return (IRR)

The IRR estimates the value a property generates during the time frame you own it. Effectively, the IRR is the % of interest you earn on each dollar invested in a property over the entire holding period. This ratio is a much more comprehensive ratio than Cap Rate and Cash on Cash return as it takes into account all aspects of the transaction over time (cash flow generation, leverage, property appreciation, time value of money, etc.). More about Internal Rate of Return

1% Rule

The 1% rule is a guideline frequently referenced by real estate investors when evaluating properties. This rule of thumb states that the monthly rent should be equal to or greater than 1% of the total purchase price of an investment property. In practice, you may find it very difficult to acquire properties fitting that criteria, especially in certain expensive local real estate markets.

Price to Rent

Calculated as (Purchase Price + Repair Costs) / Total Annual Income. The price-to-rent ratio is the ratio of a home price to annualized rent in a given location and is usually used as a benchmark for estimating whether it is cheaper to rent or own a property.

Frequently Asked Questions

Whether owning an Airbnb property is profitable depends on various factors such as location, property type, rental demand, operating expenses, and management efficiency.

Before investing in an Airbnb property, you should always conduct thorough research, including financial projections, to determine if it will be profitable in your specific situation. Using our Online Airbnb Estimator is a great first step towards a adequate due diligence.

Short-term rentals are a type of real estate investment that can offer high returns through rental income and property value growth but they also don’t come without risks. When searching for new investment properties, it is crucial for investors to evaluate factors such as potential rental income, expenses, seasonality, and local competition to determine if a property could be an adequate Airbnb investment.

A short-term rental calculator is an indispensable tool for investors to evaluate the potential profitability of rental properties, make informed decisions, and develop strategies to maximize returns while minimizing risks.

An Airbnb calculator is a specialized tool designed to help current and prospective Airbnb hosts or investors analyze the profitability and financial feasibility of renting out a property on the Airbnb platform. Here are specific uses for an Airbnb calculator:

  1. Evaluating Potential Income: To estimate how much revenue a property can generate based on factors like location, property type, size, and local demand for short-term rentals.
  2. Estimating Occupancy Rates: To predict how often the property will be booked throughout the year, taking into account seasonal variations, local events, and general travel trends.
  3. Calculating Expenses: To itemize and estimate all costs associated with running an Airbnb, including but not limited to mortgage or rent payments, utilities, maintenance, cleaning fees, supplies, insurance, and Airbnb’s service fees.
  4. Understanding Cash Flow: To assess the net cash flow the property might generate after subtracting expenses from income, giving a clearer picture of the property’s financial viability.
  5. Analyzing Return on Investment (ROI): To calculate the return on investment or the cap rate for the property, helping investors understand how the Airbnb compares to other investment opportunities.
  6. Setting Pricing Strategies: To help in deciding optimal pricing for different times of the year, based on demand forecasts and competitive analysis, maximizing revenue potential.
  7. Scenario Analysis: To run various scenarios by adjusting inputs like rental rates, occupancy rates, and expenses to see how changes can affect profitability, helping in strategic planning and risk management.

Using an Airbnb estimator can significantly enhance decision-making processes by providing a detailed and nuanced understanding of the financial dynamics of renting out a property on Airbnb. It helps hosts and investors to make informed choices, optimize their operations, and maximize their returns while minimizing potential risks.

Absolutely, all of our calculators are completely free to use.

No, this calculator has been specifically built to analyze Airbnb properties and short-term rentals.

If you want to analyze and manage long term rental properties, please check out our free Rental Property Analysis Spreadsheet

This online estimator cannot be downloaded as a spreadsheet. If you wish to have your own spreadsheet, check out our free Airbnb Calculator for Excel

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