I hope you enjoyed the 4th of July holiday. Another month has passed and now it’s time to provide the vacation rental report for June. So far, I’ve mainly reported losses since the year started. There have been numerous articles and posts about the Airbnb Bust. The idea being is that booking is down across the board and Airbnb (and by extension other platforms such as VRBO) is not profitable as it was before. Every market is different. Although my calendar gets booked, I’ve noticed that the price per booking has somewhat declined. Truth be told, I don’t expect to be profitable every month, but I do hope that I can end the year at a profit. Only time will tell. Until then, let’s see how Calypso Memories did in June.
Vacation Rental Profit/Loss
I had elevated expenses in May. I am hoping that June represents a more normal month. Let’s see.
A. Vacation Rental Income
During the month of June, I earned $8879 in income broken down as follows:
As you can see from the chart, I’ve earned more in June than I did in May, but as you will see shortly, the revenue generated in June is substantially less than that of June of last year.
Am I experiencing an Airbnb Bust?
B. Vacation Rental Expenses
During the month of June, I incurred $7695 in expenses broken down as follows:
Wow, that’s high. When I did my initial calculations, my expenses were nearly $10k. But I realize I was counting a full refund as an expense, without including the initial revenue as income. So, that skewed things. Partial refunds are ok to put as an expense, as long as I record the initial full revenue received from that booking – the math evens out. But I will ignore full refunds from both the income and expenses chart going forward.
Thankfully, the expenses incurred were less than that of May.
C. Profit/Loss Statement
Based on the fact that my income exceeded my expenses, my profit for June was $1184. Notably, when I made the error in accounting as described above (i.e. referring to recording a full refund as an expense), this section said that I incurred a loss of $1000. So, I’ll definitely take a profit of $1184 any day, even though it’s a small profit for June.
June is supposed to be a month where I make a dent into my overall loss for the year. So, it’s not as high as I would have liked, but it’s better than the alternative.
As shown below, the year-to-date loss is a whopping $9462.
Annual Income and Expenses
2022 was my first year when my condo went live on the market, so let’s see how June 2023 at Calypso stacks up against June 2022.
A. Annual Income
Here is the raw data:
As you can see, I made 26.59% LESS revenue this year than I did last year June. Of course, it could be worse, but it’s a sign that bookings have been down this year. Not only are bookings down, but it seems like the nightly rate per booking has dropped as well. Moreover, when you couple the fact that expenses for home owners have increased, you get the perfect storm of bad financial news.
B. Annual Expenses
We had a bad report for the annual income. Let’s see how the annual expenses at Calypso look from last year to this year.
Here is the raw data:
I do anticipate that my expenses will be elevated over the next 6 months to a year. As indicated in my June Debt Payoff Report, I’m trying to pay back an HVAC system that I bought and the payment I am making is $650 per month.
In any case, my expenses are moving in the wrong direction (annually). This is turning out to be a very expensive year!
Final Thoughts
As the saying goes, you win some and you lose some. Technically, this was a good report in that I made a profit for the month. But, with bookings down, and expenses high, my profit was small. Moreover, the profit I made only placed a small dent in my overall loss for the year.
In looking ahead, July is arguably the busiest month of the year. However, I still have a lot of white space on my calendar. The good news is that there is still time to turn things around.
Given this report, it’s likely that I will end the year with a loss. How much of a loss is still yet to be determined.
What did you think of this report? Let me know your thoughts by commenting below.