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Should I Convert My Airbnb to Assisted Living?

By April 6, 2024May 8th, 2024No Comments
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How many people have tried short-term rentals and Airbnb?  In some markets, it may be too many.

That may be the reason that a reader sent in a question about converting their Airbnb to assisted living.  They asked if that may be a good idea and, if so, how to get started.

How different is Airbnb and assisted living?

There are parallels between short-term rentals and some types of assisted living.

If you own an Airbnb, you may have converted a single-family home or even vacated your own home to use it for that purpose. The same thing happens for many who own and operate assisted living homes, which are operated in houses that were initially used for single-family homes.

Common ground between Airbnb and assisted living may continue with the service provided.  Assisted living operators must provide hospitality for residents to enjoy a quality living experience.  They might also offer concierge-type services that an Airbnb operator might provide guests.

However, someone with an Airbnb background must recognize significant differences, too.

Assisted living is a more regulated business. Residents have healthcare and other needs that the operator is expected to manage.

Assisted living homes and facilities are staffed with caregivers, so assisted living has staffing, training, and human resources issues that many short-term rentals seldom face.

Assisted living is a 24/7/365 business where owners or their teams are always on call.

An assisted living home is the resident’s home.  It’s not just where they visit but where they live.

There are some similarities between Airbnb and assisted living, but significant differences exist.

How do I convert from Airbnb to assisted living?

Converting a home from Airbnb to assisted living is usually the same as converting a single-family home to assisted living.  We’ve covered that process in other posts (like this one).

For the reader who asked this question, an owner of an Airbnb short-term rental, I shared this word of caution:

Don’t jump into assisted living just because the numbers look good.

Dozens or hundreds of websites and coaches view assisted living as another real estate investment like Airbnb.  While it may be a real estate investment, it’s also a business with unique and challenging issues that many don’t realize until they’re already in.  Make sure you know what you’re getting into when converting to assisted living.

It may be helpful to start with these three steps before going further:

Site and building suitability

If you’re operating a single family home for short-term rental, then the chances are good that the home is in a location that allows assisted living.  But it’s essential that you confirm that it’s allowed by talking with your local zoning office or others about your plans.

Even if assisted living is allowed at your location, make sure that the house has the right design to accomodate the needs of your future residents.  For example, a two story home with stairs to second floor bedrooms will be an issue for most assisted living residents.

Market feasibility

Does anyone want what you plan to offer?  Some will start their assisted living with an assumption that the growing number of older people (the Baby Boomers in particular) will guarantee a full house.  That’s not always the case.

A market feasibility study doesn’t need to be an expensive or time consuming research project.  There are many simple steps that will help you understand your market, including the supply and demand in your area.  Have you checked out all the other assisted living options in your area?  What do they charge?  Do they have vacancies?  How will your assisted living home be different in the market?  These are some of the questions you should answer.

Financial feasibility

You may be able to fill your assisted living home.  The next question is can you afford to pay the bills.  That is one question that a financial feasibility review will answer.  Staff is the biggest expense for any assisted living home.  How much staff will you need?  What is the normal hourly rate for the staff you need?  How about payroll taxes, benefits, and insurance?  These are some of the parts of your financial feasibility review. Knowing your numbers before moving ahead with your conversion to assisted living will greatly increase the probability of success.

Conclusion

Assisted living homes often had another use before their conversion.  Airbnb might be one of those uses in the history of your assisted living home.  But make sure you take the important steps of confirming your project’s feasibility before making the leap to assisted living.  Each of the steps listed in this article has many more steps you want to take.  We touched on just a few things that are essential but you can always check back with us for answers to your questions and more on converting your home, Airbnb, or any property to assisted living.

 

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