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The Complete Guide to Buying a Cabin for Airbnb

The Complete Guide to Buying a Cabin for Airbnb

It goes without saying that vacation rentals are an integral part of the tourism industry these days. Since its founding in 2007, Airbnb has captured the largest share of the travel market and, including its competitors, proved that homeowners could monetize their homes by renting out entire homes or private rooms to short-term renters. Airbnb revolutionized the short-term rental industry by making vacation homes readily accessible to the masses by creating a brand that redefined short-term vacation rentals.

It is estimated by Statista that, in 2023, revenue in the global vacation rental industry is expected to reach US$96.85 billion. The number of users in the vacation rental market is estimated to reach 899.0 million by 2027. In 2023, user penetration is 10.9%, with 11.3% projected by 2027.

What Is a Cabin Vacation Rental?

A cabin vacation rental can be anywhere from a coveted cabin just outside the city, a hillside hideaway overlooking the mountains, or an off-the-grid cottage fit for a fairytale. Either way, cabin vacation rental homes are typically small homes that are located in remote locations, such as near mountains, on farms in rural areas, or built inside wilderness areas or close to national parks.

With cabin rentals, the focus is always on getting in touch with nature and being off the grid. Generally, cabins are constructed using eco materials, with a mix of wood and stone to conserve the environment and minimize ecological damage.

Would Buying a Cabin be a Good Investment?

Would Buying a Cabin be a Good Investment

With breathtaking night skies, s'mores, and warm cider drinks around a crackling fire, an elegant wood cabin is a perfect getaway and a travel trend embraced in 2022 that will continue well into 2023.

According to VRBOs 2023 travel trends, rustic getaways are on the rise, with demand for Vrbo homes increasing by 30% in western US destinations. Guests are searching for luxury lodges, ranch retreats, and farmhouses with year-round outdoor pursuits, and home-cooked meals as they seek out intimate escapes into the rugged wilderness. The trend is not confined to the US alone. In Europe, travelers are looking to stay in converted barns and farmhouses in the countryside of Italy, Spain, France, and the UK, many of which have pet-friendly policies.

An important factor to consider when buying a cabin is whether it will make a good long-term investment, especially if it will be used as a vacation rental for Airbnb or any other similar OTAs such as Vrbo, Booking.com, Google Travel, etc.

In any investment conducting deep research is vital in order to determine if the investment is worth its while. Before proceeding, several factors need to be considered. A good way to make the final decision is to weigh the pros and cons.

Advantages of Buying a Cabin for Vacation Rental

An Excellent Opportunity for Passive Income

A rental cabin can provide a steady flow of passive income, helping to offset the cost of ownership and provide a return on investment.

Property Value Appreciation

Investing in real estate, including cabins, can provide long-term financial advantages.

Save on Tax Benefits

Deduct mortgage interest, property taxes, and operating expenses when you own a cabin vacation rental property.

Use it for Private Vacation Time

Cabins can be used for personal vacations or rented out when not being used.

Investment Opportunity of a Lifetime

Cabin rentals offer an investment opportunity that differs from traditional real estate.

Demand is on the Rise

There is a growing demand for vacation rentals, particularly cabins, providing potential for increased income and business growth.

Apart from the above, cabin rentals are particularly beneficial for nature enthusiasts. There are various locations that will offer breathtaking views, depending on the city or country of choice. Taking your surroundings to your advantage you can capture stunning standout high-quality photos of your Airbnb rental and the surrounding area that will automatically make your listing stand out and entice travelers to book. Your listing title can boast that it is a destination booking, especially with Airbnb Summer 2022 upgrade release.

Potential Drawbacks when Buying a Cabin

Here are some of the drawbacks of buying a cabin for vacation rental

High Initial Investment

Buying a cabin for a vacation rental can be expensive, and you'll need to consider the upfront cost of purchasing the property, as well as any necessary renovations or upgrades.

Maintenance Costs

Vacation rental properties, especially cabins, require regular maintenance and repairs, which can be costly and time-consuming.

Seasonal Fluctuations

Vacation rental demand can fluctuate throughout the year, which can affect your income and occupancy rate.

Consider the Competition

There may be high competition in your area for vacation rental properties, which can make it difficult to attract guests and maintain a high occupancy rate.

Regulatory Challenges

There may be local regulations and zoning laws that restrict vacation rentals or impose specific requirements on owners, which can be difficult to navigate.

Guest Management

Dealing with guests, managing bookings, and responding to inquiries can be time-consuming and require significant effort, especially if you don't have vacation rental software in place.

Property Damage Risk

You run the risk of property damage or theft if you rent out your cabin to guests, which can be costly and stressful. In such instances though, you can opt to secure a damage deposit, and if the cost is higher you can cover it through AirCover for hosts.

Demand for Airbnb Cabin Rentals

Demand for Airbnb Cabin Rentals

The demand for Airbnb cabins has been growing in recent years, driven by the increasing popularity of alternative forms of travel and the desire for unique and authentic experiences. According to Time Business News, one in every eight persons stayed in a vacation cabin rental in 2021. By 2025, the cabin rental market is expected to grow by around 10% annually, reaching $20 billion. Many travelers prefer Airbnb cabins over traditional hotels because they offer a more private and serene experience, as well as access to outdoor activities and scenic locations.

In addition, the COVID-19 pandemic has caused many people to seek out alternative forms of travel, including rural and outdoor destinations, which has further fueled demand for Airbnb cabins. As travel restrictions ease and people increasingly seek out safe and secluded getaways, the demand for Airbnb cabins is expected to remain a strong trend which began in 2022 and continues into 2023.

However, it's worth noting that demand for Airbnb cabins can vary depending on several factors, including location, seasonality, and market competition. To ensure success as an Airbnb cabin host, it's important to research the market and determine the demand in your area before investing in a cabin for vacation rental.

Simple Steps to Follow Before Buying a Cabin for Rental

Before Buying a Cabin for Rental

Cabins can be found in rural areas, near mountains, lakes, rivers, and even seashores far from urban areas. The idea of buying a cabin is enticing and captivating, but there is the groundwork to be done before you make your investment and continue on your journey.

Research the Market

Investigate the local vacation rental market to determine demand, competition, and pricing. Look at similar cabins in the area and what amenities and features they offer to determine what you need to include in your cabin to remain competitive.

Determine your Budget

Consider the upfront cost of purchasing the cabin, as well as ongoing expenses such as property taxes, maintenance, and repairs. Make sure you have a clear understanding of your budget and what you can afford.

Choose a Scenic Location

Whilst choosing a location, choose a property with a scenic location but also consider factors such as location accessibility, proximity to attractions, and local zoning laws. Ensure that Airbnb is not restricted in the area and that vacation rentals are in high demand.

Cabin Features and Amenities

Consider the type of guests you want to attract and what they might be looking for in a cabin. Factors such as privacy, scenic views, outdoor activities, and amenities can all play a role in attracting guests.

Upgrade your Property

Make sure your cabin meets all safety and comfort standards and consider investing in upgrades such as new appliances, furniture, and outdoor spaces.

Create your Listing

List your cabin on Airbnb accurately, highlighting its unique features, amenities, and high-quality photos that accurately portray the cabin's appearance.

Manage your Listings

Be prepared to manage bookings, communicate with guests, and handle any issues that may arise pertaining to your cabin's listing.

Vacation Rental Cabin Locations ideal for Starting a Business

Many of the best places to buy a vacation rental right now happen to be cabin-centric locales, and here are some of the markets in the USA with strong demand for cabin vacation rentals.

Lake Tahoe, California: With its stunning mountain scenery, outdoor recreation opportunities, and proximity to popular destinations like San Francisco and Reno, Lake Tahoe is a popular destination for vacation renters.

Big Bear Lake, California: Big Bear Lake is a popular mountain destination in Southern California, known for its ski resorts, scenic views, and outdoor recreation opportunities.

Gatlinburg, Tennessee: Gatlinburg is a popular tourist destination in the Great Smoky Mountains, known for its scenic beauty, outdoor recreation, and attractions like Dollywood and the Great Smoky Mountains National Park.

Poconos, Pennsylvania: The Poconos is a popular vacation destination in Pennsylvania, known for its scenic beauty, outdoor recreation opportunities, and proximity to New York City.

Adirondacks, New York: The Adirondacks is a popular vacation destination in upstate New York, known for its scenic beauty, outdoor recreation opportunities, and proximity to cities like Albany and Montreal.

Smoky Mountains, North Carolina: The Smoky Mountains in North Carolina is a popular destination for vacation renters, known for its scenic beauty, outdoor recreation opportunities, and attractions like the Biltmore Estate.

These are just a few examples of markets with strong demand for cabin vacation rentals. Before investing in a cabin for vacation rental, it's important to research the local market and demand, as demand can vary depending on factors such as seasonality, competition, and local regulations.

Cost Factors to Consider when Investing in a Cabin

Cost Factors to Consider when Investing in a Cabin

Insurance

You may think owning a cabin is a great way to generate passive income, but you may want to think about the insurance fees first. It is common for cabins to be located in remote areas where emergency services are not readily available. In the event of a fire in your cabin, it could take a long time for the firefighters to arrive. In coastal areas, hurricanes and floods are more likely to hit your cabin, if the locale is known for stormy weather etc.

Consider consulting a realtor before purchasing a vacation home so that you are aware of the insurance costs involved.

Water Supply to your Cabin

It is common for cabins to be located in rural areas where the city water system is not available. Therefore, you'll likely need to maintain your septic system. If you plan on hiring a septic company to perform your maintenance tasks on a schedule that works for you, you'll need to consider the costs involved.

Preparation for Winter

Ensure that your house has been winterized. For cabins located in cold climates that encounter heavy winters, this is really important. Pipes can freeze due to a drop in temperature and you want to avoid bursting your plumbing system. Consider the costs involved in winterizing your cabin before you go ahead with your purchase.

__Side note: __ Turn off the water when the cabin is not in use.

Additional Location Maintenance Fees

A maintenance company may be needed to be hired and kept responsible for disinfecting and spraying for bug repellent etc. If you live in a rural region, hiring cleaners might be a challenge, and hiring a company might cost more than the usual fee. The same applies to garbage disposal - but in this instance, you may want to find a more eco-friendly disposable solution where you recycle and repurpose waste in an environmentally friendly manner.

Cabin Amenities you Should Consider Investing in

Cabin Amenities

  1. Comfortable bedding : Guests want to feel comfortable and well-rested, so invest in quality bedding, linens, and pillows.
  2. Well-equipped kitchen : A fully equipped kitchen is a must for cabin rentals, including appliances like a refrigerator, stove, oven, and microwave, as well as dishes, cookware, and utensils.
  3. Wi-Fi and entertainment : Most guests expect Wi-Fi and some form of entertainment, like a TV with cable or streaming services.
  4. Indoor and outdoor spaces : A cabin rental should have comfortable indoor spaces, like a living room with seating, and outdoor spaces, like a deck or patio with seating and/or a grill.
  5. Heating and cooling : Ensure the cabin is equipped with effective heating and cooling systems for year-round comfort.
  6. Parking : Provide adequate parking for guests' vehicles.
  7. Cleanliness : Keep the cabin clean and well-maintained, with regular cleaning and maintenance.
  8. Safety features : Install safety features like smoke detectors, fire extinguishers, and carbon monoxide detectors.

Here are some "nice to have" extra amenities you can offer guests in a cabin vacation rental to enhance their experience and make your property stand out. Adding these amenities might be an investment but you will stand to gain long-term benefits, especially with guest reviews and ranking higher in the search algorithm.

extra amenities you can offer guests in a cabin vacation rental

  1. Hot tub or outdoor spa: Adding a hot tub or outdoor spa can add to the relaxation and enjoyment of guests, especially during colder months.
  2. Fireplace or fire pit: A fireplace or fire pit can add warmth and ambiance to the cabin, making it a cozy and inviting space for guests.
  3. Game room: A game room with a pool table, arcade games, or other entertainment options can be a fun and unique offering for guests.
  4. Waterfront access: If the cabin is located on a lake or river, consider offering guests access to a dock or boat slip.
  5. Fitness equipment: Offer guests the option to work out during their stay with the addition of exercise equipment like a weight bench or yoga mats.
  6. Bicycles: Provide guests with bicycles or a bike-friendly environment, such as bike trails or bike storage.
  7. Luxury touches: Add luxury touches like high-end toiletries or a gourmet coffee station to make guests feel pampered and special.
  8. Hiking trails: Offer guests access to nearby hiking trails or provide maps and guides to popular routes.
  9. Outdoor recreation equipment: Provide guests with equipment for outdoor recreation, such as fishing gear, kayaks, or snowshoes.
  10. Ski-in, ski-out access: If the cabin is near a ski resort, consider offering ski-in, ski-out access or storage for ski equipment.
  11. Wildlife viewing: Offer guests the chance to observe local wildlife, such as birds or deer, with binoculars or a bird-watching guidebook.
  12. Mountain views: Highlight the cabin's mountain views with large windows or a wrap-around deck.
  13. Cozy reading nooks: Create cozy reading nooks throughout the cabin, with comfortable seating and good lighting.
  14. Firewood and s'mores: Provide guests with firewood and s'mores supplies for a classic mountain cabin experience.

Conclusion

The allure of travel remains constant despite the constant changes in the vacation rental industry. If done correctly, cabin rentals can be a good investment. Among the factors that contribute to success are location, demand for rental properties in the area, and proper management and maintenance. As well as ongoing expenses, like taxes, insurance, utilities, and maintenance, it is important to consider the competition from other rental properties. Making an investment decision requires careful research and consultation with a financial advisor.

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