Category: Pricing & Revenue
By: Kevin O'Brien
Reply by David Okafor:
Great topic. Here's my comprehensive cost-per-night breakdown that I use across 3 properties: **Fixed monthly costs (divide by 30 to get daily):** - Mortgage/rent - HOA fees - Property insurance (STR-specific from Safely https://safely.com or Steadily https://steadily.com) - Property taxes (monthly equivalent) - WiFi / internet - Utilities average (electric, gas, water, trash) - Channel manager / PMS software - Dynamic pricing tool (PriceLabs https://pricelabs.co) - Streaming services (Netflix, etc.) - Lawn care / HOA **Per-booking costs:** - Cleaning ($80-150 per turnover) - Laundry (if using a service) - Consumables restock (~$15-25 per booking: toiletries, coffee, paper goods) - Platform fees (Airbnb 3%, VRBO 5-8%) - Payment processing (included in platform fees usually) **Annual costs (divide by 365):** - Deep cleaning (2-4x/year) - HVAC maintenance - Pest control - Photography refresh - Furniture replacement fund (I allocate $1,500/year) - Unexpected repairs fund ($2,000/year) - Accountant / tax prep When I added it all up for my 2BR, my true cost per night was $68. So when Airbnb shows "$95/night booking — your payout is $92," my actual profit is $24/night. Eye-opening. For running these numbers, DealCheck (https://dealcheck.io) is excellent for the financial modeling. It factors in all these line items.
Reply by Chris Nakamura:
This is exactly the kind of analysis every host should do before buying their next property. I'll add a few often-forgotten costs: - **Sales/occupancy tax** if your platform doesn't collect it (check your local rules) - **License/permit renewal fees** (some cities charge $100-500/year) - **Liability insurance deductible fund** — if something happens, you need $500-1000 for the deductible - **Opportunity cost** — what else could your capital earn? If you have $50K tied up in furniture/deposits, that's ~$2,500/year in lost investment returns at 5% The unsexy truth of STR hosting: it's a real business with real overhead. Anyone telling you it's "passive income" hasn't done this math.
Reply by Michael Thompson:
I track all my numbers in a Google Sheet but honestly AirDNA (https://airdna.co) Rentalizer tool is great for projecting revenue against your known costs. You can see exactly what comparable properties are earning and whether your market can support profitable hosting. Plug in your actual costs vs projected revenue and you'll know within 10 minutes if a property makes financial sense.
Reply by Anika Sharma:
One trick that saves me money: **negotiate your cleaning rate based on volume.** My cleaner dropped from $110 to $90 per turnover when I guaranteed her 15+ turnovers/month across my properties. That's $300/month saved. Build a real relationship with your cleaner and they'll work with you on pricing.
Reply by Nightly Numbers:
Good list so far. One thing worth checking in the breakdown above: dividing monthly costs by 30 gives the cost per available night, but only booked nights earn revenue. With 1,500 a month in fixed costs, dividing by 30 gives 50 per night. At 60% occupancy (18 booked nights) the real figure is 83.33 per booked night. The same applies to the other lines. Per-stay costs like cleaning should be spread over the nights in the average stay, and nights you block for yourself or for maintenance still carry the fixed costs while earning nothing. So break-even depends on occupancy more than on any single cost line. With the same 1,500 it is 100 per booked night at 50% occupancy, 83.33 at 60% and 71.43 at 70%, so it is worth running your number at two or three occupancy levels to see how fast it moves.