Over recent years, Airbnb has emerged as a strong competitor to traditional hotel accommodation around the world. For travellers, it can be a cheaper and more bespoke experience. For homeowners it presents a lucrative money spinner in locations with high tourist activity. New Finder research can now reveal the most lucrative suburbs for listing a property on Airbnb for homeowners and for renters looking to sublet.
Western Australia appears the most lucrative state with the top 3 most profitable suburbs. Wanneroo is the most profitable suburb, where homeowners can expect to make a potential average profit of $5,885 per month. This is a profit margin of 69% generating $6,658 more per month than renting out that same property.
Exmouth comes in second with a potential profit of $4,959, while Broome comes in third where homeowners can expect to generate $4,873 of profit per month.
In Victoria, Mount Martha is the most profitable at $4,828 per month.
In South Australia, it's Nuriootpa in the Barossa Valley that can generate the most profit from Airbnb, delivering $4,713 profit per month.
In New South Wales, Coffs Harbour is the stand out suburb generating on average $3,540 per month in profit.
Tasmania lags behind the other states, with its most profitable suburb George Town only generating on average $1,583 per month from Airbnb listings.
Airbnb for renters
Over 2022 and 2023 rental prices have surged with vacancy rates falling dramatically. Finder's research shows that median asking rents have increased 11% in February 2023 compared to the same period in 2022. So, how much could renters make on Airbnb by subletting their home?
Finder's research reveals Mount Martha in Victoria is the most profitable suburb for renters, delivering a whopping $8,295 per month in profit from simply subletting on Airbnb. This amounts to a profit margin of 76%.
Flinders comes in second at $7,072, followed closely by Wanneroo in Western Australia at $6,658 potential profit per month.
In South Australia, Lyndoch is the most profitable where renters can expect to generate $5,668 from subletting on Airbnb.
In New South Wales, Mosman offers the biggest opportunity to renters with an average profit of $4,997 per month.
Tasmania once again lags behind, with George Town the most profitable suburb only able to generate $2,239 per month on average.
The potential profit from subletting on Airbnb is a double edged sword for renters. Research shows that Airbnb listings do reduce the rental supply and can push rental prices higher.
The research assumes an occupancy rate of 50% (15 days booked per month), a 3% hosting fee for Airbnb, and that the homeowner still pays a mortgage at the current discounted variable interest rate for investors of 6.95% in May 2023.
Also suburbs are only included where there is data for Airbnb listings and data on median asking rents and median sales prices.
Saranga Sudarshan is an insights analyst at Finder. He has a PhD from the University of St Andrews in political philosophy. Previously he was a research analyst at Frost & Sullivan. Saranga loves cricket, sports analytics and the way data can provide novel insights.
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