With over 30 units managed by Ikhram Merican and his team, Ikhram is acknowledged as one of the most experienced and successful AirBnb host in Malaysia. He shares his secrets recently at a workshop in Kuala Lumpur.
MARKET POTENTIAL IN MALAYSIA
To gauge its market potential, you have to look at the tourism numbers for Malaysia since by and large AirBnb properties here cater to tourists. Malaysia is second only to Thailand as the top tourist destination in Southeast Asia and is ranked 11th in the world. For the last 15 years, Malaysia has been improving year-on-year. Further, medical tourism is experiencing phenomenal growth amid a depreciating ringgit.
“The tourism market is huge in Malaysia and there is a lot of potential yet to be unleashed. For example, Langkawi is better than Phuket but not enough has been done to promote it. We are certainly not at our peak potential yet,” notes Ikhram.
He adds that the leisure travel culture now is prevalent among most Y and Z generations worldwide. “Furthermore, you can make friends in Airbnb. For example, I can go to 40 countries and stay in AirBnb of some of the guests who have stayed in my properties.”
And when it comes to competition, there is enough room for everyone as AirBnb is still at an early stage in Malaysia. “It is a big market, not saturated – so, there is enough room for growth in many areas.”
“There is price pressure on Airbnb now but if you maintain the price to value performance, there is little to worry about,” he asserts.
Overall, there are 3 points to note when you want to succeed as an AirBnb host:
Maintain good price to value performance. You need to do some research to determine the optimum price for your accommodation.
High profitability – As long as you can get a minimum of 60% occupancy, your cash flow will be positive even after deducting monthly maintenance expenses such as electricity and internet connection.
5-star reviews – 80% of your reviews need to be 5 stars. For example, there is a host who charges room rates that are 40% over the market rate but 95% of his reviews are 5 stars. Why? Because he provides extra services such as fetching guests and his wife cooks a very delicious breakfast (all included).
You need to understand the hospitality business. You need to cultivate patience with guests and can’t give standard response like “wait till tomorrow”.
Good systems You must respond fast if there are any complaints.
For example, you must service the air conditioner once a year. Get on standby the handyman, plumber, air-cond man, etc. – in other words, a list of service people who are the cheapest but can do the job well. Among all of them, cleaners are the hardest to find.
It goes without saying you need to have the time to deal with the guest requests and the accommodation
You can rent the property from the owner and rent it out under AirBnb, but the owner must agree and this should be reflected in your Tenancy Agreement. The landlord then will be responsible for the structural problems or any fixtures and fittings or furnishings that are are included in the rent. The furnishing does not have to be luxurious but must be pleasing to the eye.
Ideally, the property should be located within 500 metres to a train/LRT station or bus stop/taxi stand. It’s a bonus if it’s near shopping malls, lively nightlife, entertainment centres or food hub. Even better, if it has unobstructed view of greenery even though it is located right in the heart of the city centre.
PROPERTY SELECTION CRITERIA
a. Decide whether you want it to be in the city, suburban, outskirts or other states with good tourist attractions. A service apartment in the city centre with good location can fetch between RM170 – RM300 for 2 bedrooms. During special occasions like Valentines’, you can increase the rates as demand spikes.
b. If you have a property that is not in or near tourist hotspots, then try to see what unique selling points you can provide with regard to your property. It could be additional services like shuttle transportation or free meal included. Tourists want to experience home cooked food or a visit to the wet market early in the morning. Check out the wish list in AirBnb to get an idea of what type of unique accommodation tourists are interested in. Examples include a secluded treehouse, sea shell house, and a time capsule turned into a museum.
PREPARING THE PROPERTY
Interior design is an essential task in order to have tasteful furnishing. It doesn’t necessarily have to be expensive because the guests are not particular about furnishing. What they need is a functional place such as a comfortable bed, working showers with hot water and air-conditioner as it is more a place to sleep in. Average days spent is 3 days.
Furnishing: Try to get second hand hotel beds or furniture/furnishings. Your Airbnb unit must be fully furnished with the minimum modern conveniences and furniture.
Take nice photos of the property, both internal and external.
Creating value: Place a map of the location with interesting landmarks and tell them the nearest station; place android TV boxes, hair dryers, etc.
Verified guests: 90% of guests are truthful and honest but you take in only guests with verification, or prior reviews.
Free wi-fi: Ensure your Internet is working as all guests expect free high speed wi fi to be included.
Self-check-in: Prepare a self-check-in method so you don’t have to be present personally to welcome the guest. Or leave the key in the mail box which should be locked with a combination lock. So, you can just give the guest the lock combination.
Free stuff: Place free water bottles, tea/coffee bags and kettle in the unit and preferably a mini bar. You may display items that are being sold by your Malaysian partners such as tea from Borneo or soap/ chocolate made in Malaysia. If they like it, they can then buy it online.
Transport: Let them know about transport availability for example, 24-hour airport pickup and drop-off. Or, use Grab or Uber which are charged separately.
Bi-lingual manual: Prepare a house manual with instructions on how to operate all the electrical items such as the TV, Internet, heater, cooker, light switches, air condition remote, and how to exit in case of fire. The manual should also explain what to do when the Internet is not working and where the gym or swimming pool is in the apartment. Preferably, the manual should be in both English and Chinese. Label relevant items to make it easy for the overseas guests.
TOP 10 TIPS TO ATTRACT MORE BOOKINGS
During the early days, you can try to get relatives and friends to stay to build reviews. It’s essential to have good reviews because often, potential guests check out reviews of your property before booking.
The best way is to ask guests to write the reviews. Build as many reviews as possible. The more reviews you have, the more bookings you will get.
Tell everyone you have an AirBnb listing including on social media and offline. Link it to as many other platforms as possible. When AirBnb senses it, it will give you more visibility. This is the only way to get yourself more bookings. Do some promotions like “Book 3 nites and get one nite free!” or “Free airport transfer”.
Bookings – you must respond within 24 hours; if you respond within 1 hour, you get more visibility. Synchronize your calendar with other platforms to avoid booking overlap. Don’t ever cancel, as the penalty is very severe. You can black out the dates for periods when you are not free to host.
The key is communication – use Google Translate which is about 80% accurate. This will allow you to communicate with visitors from all over the world.
Prepare a standard check list for the guests when they arrive so they can handle everything by themselves without your presence.
Make sure the cleaning is spotless. Guests are particular about such things like hair on the bedsheet. Ensure you provide fresh sheets, fresh linen and towels to your guests; all supplies such as soap and shampoo should be topped up after the departure of each guest.
For food items, stock up on instant noodles and bottled water which some guests request at odd hours.
To add to your guests’ local experience, join forces with local tour operators to give unique tours such as a night market outing, search for the best local food or spend an evening with a craftsman. You can even organise tours to durian orchards, waterfalls, etc.
It is important to be patient, polite, prompt and punctual at all times when dealing with the guests.
The next workshop is on 22 April 2017. For enquiries,
please e-mail email@example.com or call +603-9059 6218[/ihc-hide-content]