AirBnb in Sydney : How to invest?
Click here to see my Excel files.
Click here to access the raw data.
Based on the already listed home in Airbnb in Sydney, I extracted clear data about Airbnb performance in the market to answer the questions :
How and where to invest in an Airbnb hotel in Sydney?
Part 1 : Cleaning the data
Using Excel, I handled some missing values :
Deleted some row and columns
Replaced by the average of available value
Deduced the value from other features
Part 2 : Rewrite the questions :
I had to transform the questions to be able to answer with the available data.
Which neighborhood, size of home (given by the number of bedrooms), and type of location generate the greatest monthly income?
To obtain the monthly income I used assumptions based on Inside Airbnb: Data Assumptions. All details are given is the Excel files, under the ‘Data Handling Summary’ Sheets.
Part 3 : Analysis
To be able to furnish a more precise analysis, I decided to keep the listings from the 10 neighborhoods with the most amount of listings (that cover 75% of the available data).
Then I looked as the average income, grouping by the number of bedrooms :
I then decided to focus on the fourth most profitable income : Woollahra, Manly, Sydney, and North Sydney.
The average income in North Sydney decreases from 2018 and seems to have suffer from COVID crisis. With the record success in 2022, we can say that the average is misrepresenting. So I decided to focus only on Sydney, Manly, and Woollahra.
The average income in these 3 neighborhood increases over the years. A deeper analysis could be done to see if the increase in the median income is greater than the inflation.
I select the most profitable neighborhood, and saw that room with more than 4 bedrooms generates greatest income. Now I study the type of location.
For houses with more than two bedrooms available, most listings are for entire home. Entire home received in average better income, and better reviews.
CONCLUSION :
It is the good time to invest in a property in Sydney, Manly or Woollahra.
You should buy a property with more than 4 bedrooms, and rent it as an entire property.
What I learn and how to go deeper ?
I learn how to handle missing values, how to select metric, and how to document our assumptions. I practiced Excel for cleaning, analyzing data, and produce visualizations. I produce a conclusion and the possibility to bring some insights to a potential investors.
To pursue the analysis, we could look at house prices, to not only see the expected income, but how much months are needed to reach rentability.