In the competitive world of short-term rentals (STRs), the design of your property can make all the difference. An appealing, functional space not only attracts more guests but can also justify higher nightly rates, ultimately boosting your return on investment (ROI). Below, I’ll explore some key considerations for short-term rental renovation and design, followed by actionable tips to help you elevate your property’s appeal.
Top Considerations for Short-Term Rental Renovation and Design
When planning renovations or making design updates to your STR property, it’s important to focus on a few key priorities. These considerations will help ensure that your investment pays off by attracting the right guests and providing them with a memorable experience.
Functionality
The functionality of your space should be a top priority. Consider how guests will use the property and make sure that it meets their needs. For example, ensure that kitchens are fully equipped for cooking, bathrooms are user-friendly, and bedrooms are comfortable and inviting. Spaces should be designed with ease of use in mind, allowing guests to move freely and access everything they need without hassle.
Affordability
While it might be tempting to splurge on high-end finishes and luxury upgrades, it’s important to strike a balance between quality and cost. Focus on making smart investments that will enhance the guest experience without breaking the bank. Prioritize upgrades that will have the most impact, such as modernizing bathrooms or upgrading kitchen appliances, while avoiding unnecessary expenses that won’t significantly boost your property’s value.
Aesthetics
A visually appealing space is crucial for attracting guests, especially in today’s image-driven market. Consider the overall style of your property and how it fits with the location and target audience. Whether you opt for a modern, minimalist look or a cozy, rustic feel, consistency in design is key. Additionally, consider adding unique touches that set your property apart, such as local artwork or custom furniture.
Broad Appeal
To maximize your booking potential, aim for a design that has broad appeal. While it’s important to have a unique and stylish space, it’s equally important that your property appeals to a wide range of guests. Avoid overly personalized or niche design choices that might alienate potential renters. Instead, focus on creating a neutral, welcoming environment that anyone would enjoy.
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Are Renovations and Redesigns Deductible?
The answer to this questions depends on several factors that require in-depth discussion in their own right. Some or all of your renovation expenses may be deductible under certain circumstances. Check out our blog post on home improvement tax deductions for a more in-depth discussion on the subject.
When Should I Consider Renovating or Redesigning My Rental?
There are several scenarios where it might be time to consider making updates to your STR property. Recognizing these moments can help you stay ahead of the competition and keep your property in top shape.
Low Occupancy Rates
If your property is struggling with low occupancy rates, it might be time to consider a renovation or redesign. A fresh look can make your listing more appealing and help attract more guests. Updating outdated spaces, improving the functionality of the property, or adding new amenities could be just what you need to boost bookings.
Guest Feedback
Pay close attention to guest feedback, especially if multiple guests have mentioned the same issues. Common complaints about cleanliness, outdated decor, or lack of amenities should be taken seriously. Addressing these concerns through renovation and design updates can lead to better reviews and more repeat bookings.
Market Trends
The STR market is constantly evolving, and staying current with trends is essential. If your property is starting to look dated or no longer meets the expectations of modern travelers, it’s time to consider an update. Keep an eye on design trends in the industry and consider how you can incorporate them into your property.
Increased Competition
As more properties enter the STR market, it’s important to differentiate your listing from the competition. A well-designed, updated property is more likely to stand out in a crowded market, helping you secure more bookings. If you’ve noticed an increase in competition in your area, it might be time to invest in renovations to maintain your property’s competitive edge.
Our Top STR Renovation and Design Tips
As both a tax advisor specializing in Airbnb and a STR owner myself, I have learned a lot about the industry over the years. Here are my top tips for owners considering renovation and design changes, based on my conversations with some of the best Airbnb hosts in the business:
1. Invest in Smart Home Technology
Integrating smart home technology into your STR can enhance the guest experience while making property management easier for you. Consider adding smart locks for keyless entry, which not only provides convenience for guests but also allows you to manage access remotely.
A smart thermostat is another must-have gadget for your STR. Adding one to your unit can save on energy costs by automatically adjusting the temperature when the property is unoccupied. Installing smart lighting is another good option, as it creates an inviting atmosphere that guests can control with their phones.
2. Focus on the Kitchen and Bathrooms
Guests pay the most attention to kitchen and bathrooms, so you should make these spaces a priority. Modernizing the kitchen with updated appliances, new countertops, and ample storage will make it more functional and attractive. In the bathroom, consider adding luxurious touches, like a rainfall showerhead, heated floors, or high-end fixtures.
A well-designed kitchen and bathroom can elevate the entire property and justify a higher nightly rate. Renovations to these rooms can be quite expensive, but affordable surface-level upgrades can also make a big difference
3. Create an Outdoor Oasis
An inviting outdoor space can be a major draw for guests, especially in areas with pleasant weather. Consider adding a deck, patio, or garden area where guests can relax and enjoy the outdoors. Furnish the space with comfortable seating, a dining area, and perhaps even a fire pit or hot tub. Outdoor spaces provide added value and can be a deciding factor for guests choosing between your property and another.
4. Use Neutral Color Palettes
When it comes to interior design, neutral color palettes are a safe bet. They create a clean, modern look that appeals to a wide range of guests. Neutral tones like whites, grays, and beiges also make spaces feel larger and more inviting. You can add pops of color through accessories like throw pillows, rugs, and artwork to keep the space from feeling too bland.
5. Incorporate Local Elements
Adding local touches to your property’s decor can make it stand out and give guests a unique experience. Consider incorporating artwork, crafts, or furniture made by local artisans. You could also use materials that are native to the area, such as reclaimed wood or stone. These elements not only add character to your property but also help guests connect with the local culture.
6. Maximize Storage Space
Guests appreciate having plenty of storage options, especially if they’re staying for an extended period. Make sure closets are spacious and equipped with hangers and shelves. Consider adding built-in storage solutions like under-bed drawers or wall-mounted shelving. Adequate storage helps guests feel more at home and keeps the property looking tidy.
Closing Thoughts on STR Design and Renovation
Designing and renovating your short-term rental is an ongoing process that requires thoughtful planning and consideration. By focusing on functionality, durability, and guest appeal, you can create a space that not only attracts more bookings but also enhances the overall guest experience. Whether you’re making minor updates or planning a complete overhaul, the tips outlined above can help you maximize your investment and stay ahead in the competitive STR market.
Shared Economy Tax specializes in tax and accounting services for Airbnb hosts and real estate investors. Our team has extensive experience utilizing sophisticated tax strategies that can help property owners reap huge savings on their taxes. Get started now with a one-on-one strategy session to see how much you can save.
