The process of tracking income and expenses, and generating financial statements to monitor the profitability of your short-term rental business.
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Glossary Term: Cash Flow
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The evaluation of a short-term rental property’s financial performance, considering factors like purchase price, operating expenses, rental income, and market trends.
The expenses incurred in the day-to-day running of a short-term rental property, excluding major renovations or capital expenditures.
An estimate of the profit a host can expect to earn from their short-term rental property after deducting all expenses, including mortgage, utilities, taxes, and fees.
The profit earned from a short-term rental property after deducting all expenses, including cleaning fees, management fees, and platform fees.
Using income generated from short-term rentals to cover part or all of the mortgage payments on a property, potentially making it a profitable investment.
Recurring costs associated with running a short-term rental, including utilities, cleaning fees, property management fees, and maintenance expenses.
A metric used by investors to assess the potential profitability of a short-term rental property, calculated by dividing the projected annual rental income by the monthly mortgage payment.
A payment processing system that allows for real-time transaction authorization and settlement. This can be beneficial for short-term rental hosts who want faster access to their funds.
Real estate purchased or utilized specifically for the purpose of generating rental income, including short-term rentals listed on platforms like Airbnb and VRBO.
The revenue generated by hosts from short-term rentals after deducting expenses such as platform fees, cleaning costs, and maintenance.
Evaluating the financial viability of a property as a short-term rental investment, considering factors like occupancy rates, expenses, and potential income.