By LAURA LOTHIAN
In 2011, I purchased my La Mesa home that is still my primary residence.
Downstairs featured a neglected studio apartment with a kitchenette and full bath. Initially, I used it for storage but decided to rent it. Fair market rent would have been $800 per month.
My son, Mack, suggested I place the apartment on, Airbnb, a company I had not heard of at the time. Mack and his girlfriend were traipsing around Europe and couldn’t afford hotels and didn’t want to stay in hostels, so they couch-surfed on the cheap by booking through this new home-sharing concept company, Airbnb. They loved staying in people’s homes and the locals loved hosting them.
Hosting temporary guests instead of dealing with locked-in tenants plus the flexibility of accepting bookings from one night to one year appealed to me, so I placed the apartment on Airbnb.com, 30-day minimum, for the ridiculous rental price of $1,600 per month and was instantly booked for over a year. To this day, the apartment has never been vacant.
This discovery was so remarkable and profitable, I began advising my real estate clients to seek out properties that had, “Airbnb potential.” Airbnb potential can include an attached or detached guest house; studio over garage; basement or garage converted to living space; and/or a bedroom, preferably one with its own private entry/exit.
Almost all Airbnb hosts provide the essentials: fully furnished, clean premises, linens and towels, kitchen and laundry appliances, cooking utensils, flatware, Internet/Wi-Fi, TV, shampoo, conditioner, body wash, and paper products.
What elevates the experience all around – making the guests happier and the hosts more income – are the hosts providing privacy, style pizazz, designated parking spot and designated outdoor patio space. The designated parking space gives the guest parking convenience and security while courteously freeing up street parking for the neighbors.
One of my La Mesa clients took my Airbnb advice to heart and then some.
She added a detached studio (Accessory Dwelling Unit/“ADU”) to her La Mesa property. She provides all the essentials plus the designated parking space; private patio space and she hired an interior designer/colorist to create a beautiful space. This under-500 s.f. studio earns her nearly $4,000 per month. Her property is not in La Mesa Village or Mount Helix, just a regular La Mesa neighborhood.
Therein lies the dream and nightmare of Airbnb: substantial passive income for property owners but disappearing inventory and high rents for regular renters and, sometimes, huge nuisances for neighborhoods.
Airbnb “Party Houses” seem to cause the most acrimony between homeowners who live in their homes and homeowners who have turned their homes into motels.
To mitigate high rents and party houses, governments around the world are introducing and implementing regulations in an effort to balance homeowners’ rights to freely rent their homes with homeowners’ rights to live in peace.
These regulations include limiting the number of Airbnb properties in a city, the number of days a property can be Airbnb rented in a year, creating no-Airbnb zones, and often requiring owner occupancy for Airbnb properties.
If a homebuyer is purchasing a property with the intent of Airbnb-ing some or all of it, he or she would be wise to study the Airbnb regulations specific to that address.
La Mesa does not have Airbnb rules and their ADU ordinances are more lenient than California’s. There are no parking requirements except to replace existing parking if removed to build an ADU and there are no owner-occupancy requirements. There are over 1,000 Airbnbs in La Mesa.
Best Airbnb Tips for neighborhood harmony:
Owner occupancy is best. Guests behave better when the hosts are on premises.
Small is good. Studios and one-bedroom units rarely become party houses.
Create a designated parking space. Guests usurping neighborhood street parking foments hostilities.
Provide house rules to all guests and make sure they adhere to those rules.
The income earned by renting a room, guest house, converted garage, ADUs, etc. has been life-changing for millions of people. Many homeowners are able to stay in their homes because Airbnb income subsidizes their mortgages.
Because of Sacramento’s 2021 relaxation of ADU rules and regulations and the high income generated by regular rentals and Airbnbs, ADUs have exploded in California. Homes with ADUs are in high demand by buyers, substantially increasing the value of homes.
With an average sold price per square foot in La Mesa nearing $600 and the cost to build an ADU around $400 per square foot (with no land purchase costs), it makes fiscal sense to add an ADU.
The popularity of ADUs is so high, the SDMLS – San Diego’s Multiple Listing Service implemented a new ADU category this year and is now a permanent part of San Diego listings.
I am currently building an ADU in my La Mesa backyard for the purpose of Airbnb-ing it. I have had great Airbnb success for over a decade with multiple properties and no neighbor issues and am happy to advise home buyers and home owners. Call, text or email me anytime.
— Reach Laura Lothian at: Laura@LauraLothianRealestate.com.