The £120K Airbnb Myth — Why Turnover Isn’t Profit
Every few weeks, my feed gets polluted with another viral claim from someone who thinks they’ve cracked the Airbnb code. You know the type:
“Three nights in this Airbnb covered my entire mortgage!”
Or the big one:
“This single property makes £120,000 a year!”
It’s catchy. It’s shareable. And unfortunately, it’s almost always wrong.
Recently, I came across a claim just like that: a UK Airbnb host crowing about “£120,000 a year” in bookings, proudly telling followers that just a handful of nights were enough to “pay the mortgage.”
Now, I run the numbers for a living. So instead of nodding along like the cheerleaders in the comments section, I did what every serious investor should do: I broke it down.
And once you strip away the hype, the picture changes dramatically. In fact, instead of six-figure profits, the numbers show a business that’s actually losing money.
Why Airbnb Hype Is So Dangerous
Before I tear into the specifics, let’s talk about why these claims matter.
The short-let boom has created a gold rush mentality. Everyone wants to turn a regular house into a “cash machine” because they’ve seen some guy on TikTok saying he’s doing £10,000 months. It’s seductive. But the problem is that turnover headlines mask reality.
Turnover is not profit. Anyone can generate revenue if they discount heavily, but what matters is what’s left after costs.
Costs are both fixed and variable. And in the short-let world, variable costs scale with your bookings. The busier you are, the more you pay for cleaning, management, and fees.
Finance is the silent killer. Mortgages at 6%+ in 2025 mean your debt service eats cashflow faster than any other cost.
Regulation risk is real. Many councils are introducing licensing schemes or restrictions. It’s not just about the maths—it’s about whether the model will even be legal in a year’s time.
This isn’t me saying Airbnb can’t work. It can. But the profitable operators are doing things very differently than the hype merchants on Instagram.
So let’s dismantle this £120,000 claim line by line.
Step 1 — What the Property Actually Earned
The headline: £120,000 per year turnover.
The reality, according to PropertyMarketIntel, was £86,300 across 322 days of availability.
If we prorate that to 365 days, we get £97,845. That’s already a £22,000 haircut from the headline.
And we’re still talking turnover, not profit.
Step 2 — The Cost of Cleaning
This property averaged 3-night stays. That’s roughly 121.7 separate stays per year.
Each stay requires a professional clean. At £245 a pop, that’s:
121.7 × £245 = £29,815 per year.
Let that sink in. Nearly £30,000—almost a third of gross turnover—gone just to make the place presentable for the next guests.
This is why “busy” isn’t always “profitable.” The more nights you fill, the more you’re paying cleaners.
Step 3 — Airbnb Platform Fees
Airbnb takes 15% booking fees. That’s:
15% of £97,845 ≈ £14,677 per year.
Again, pure friction cost. You can’t avoid it unless you’re running your own direct-booking funnel—which most casual operators aren’t.
Step 4 — Management Fees (With VAT)
This host was using an agent. Standard fee: 15% of turnover, plus VAT at 20%.
Management fee: £14,677
VAT: £2,935
Total: £17,612 per year
That’s another big bite. And honestly, if you’re not local or you don’t want to spend your weekends changing sheets, you have no choice but to pay a management company.
Step 5 — Wear and Tear
Short-lets get hammered. You can’t run them on a zero-maintenance assumption. A safe allowance is 5% of turnover:
5% × £97,845 = £4,892 per year.
And that’s before you start talking about furniture refresh cycles, redecoration, or the odd guest who decides to host a rave.
Step 6 — Mortgage Interest
Here’s where reality smashes into fantasy.
The property was purchased for £576,000 at 75% LTV. That means a mortgage of £427,500.
At 6% interest-only (a realistic 2025 rate), that’s:
£427,500 × 0.06 = £25,650 per year.
This one cost alone is more than the gross wages of an average UK worker.
Step 7 — Fixed Running Costs
You still need to cover the basics:
Council tax: £200/month = £2,400/year
Utilities: £500/month = £6,000/year
Water: £100/month = £1,200/year
Broadband: £70/month = £840/year
Total fixed costs = £10,440 per year.
These don’t go away just because your bookings are high.
Step 8 — The Real Profit
Now, let’s add it all up.
Total annual expenses:
Cleaning: £29,815
Airbnb fees: £14,677
Management + VAT: £17,612
Wear & tear: £4,892
Mortgage interest: £25,650
Fixed running costs: £10,440
Grand total: £103,086.
Compare that with the turnover of £97,845.
Net profit = –£5,241.
That’s a loss of £437 per month.
So no, three nights did not “pay the mortgage.” Three nights barely scratched the cleaning bill.
The ROI Reality Check
This property required roughly £195,000 cash in (deposit + fees + refurb).
For that level of capital, investors expect a serious return. In this case, you’re getting a negative ROI. You’ve effectively sunk nearly £200k into a project that loses £5,241 a year.
Even if you shaved costs, refinanced, or self-managed, the economics are tight. You’d still be miles away from the fantasy of £120,000 “profit.”
Why Social Media Gets This Wrong
There are three big reasons why these myths spread so fast:
Confusing turnover with profit. “£120k” sounds glamorous. “Minus £5k” doesn’t.
Cherry-picking timeframes. Hosts brag about peak summer months but ignore winter voids.
Deliberate omission of costs. Nobody puts “cleaning bill” or “mortgage interest” on Instagram.
The truth is unsexy. Profit in property comes from detailed analysis and realistic assumptions—not soundbites designed to go viral.
How To Analyse a Short-Let Properly
If you’re serious about adding Airbnb units to your portfolio, here’s the checklist I use:
Occupancy rate: Don’t assume 90%. Model at 60–70%.
ADR (Average Daily Rate): Cross-check Airbnb, Booking.com, and market data sources.
Variable costs: Cleaning, platform fees, management—these scale with occupancy.
Fixed costs: Utilities, tax, broadband—these don’t disappear.
Finance: Always stress-test at current or higher interest rates.
Maintenance: Assume at least 5% of turnover.
Regulation: Check council licensing schemes and planning rules.
If the deal still works after running those numbers, then you’ve got something worth considering.
Where Airbnb Can Actually Work
Now, here’s the nuance. I’m not anti-Airbnb. I run numbers, and sometimes they check out. But the difference between fantasy and reality is execution.
Airbnb works best when:
You control high-ADR, low-turnover properties (think large houses for groups, or unique units).
You have a direct-booking funnel that reduces reliance on Airbnb’s 15% cut.
You self-manage or run hybrid management to reduce costs.
Your finance structure is lean (e.g., low gearing, JV equity rather than expensive debt).
You have a strong local team that can deliver at scale.
In those conditions, Airbnb can outperform buy-to-let. But you’ll never get there if you buy a £576,000 house on a 75% mortgage and let an agent run it at 15% plus VAT. That’s a recipe for negative ROI.
Case Studies: Airbnb Done Right vs Wrong
The Hype Follower
Buys an expensive city-centre flat, finances at 75% LTV, hires a management company, and posts Instagram reels about “£8k months.” Ends year one in the red.The Professional Operator
Buys a large 6-bed in a UK tourist hub for £400k cash with JV partners. Spends £60k on refurb to a luxury standard. Runs at 60% occupancy with £600 ADR. Self-manages cleaning team. Ends year one with £70k net profit.The Hybrid Investor
Keeps three of their units as short-lets but balances portfolio with standard ASTs. Uses direct booking website to cut platform fees by half. Earns £2,500 per month net across the portfolio with stability from the long-lets.
The difference? Analysis and structure—not hype.
The Hidden Risks Most Ignore
Beyond the numbers, short-lets carry risks many newbies don’t even know exist.
Regulation creep: Councils are tightening planning rules. London already has the 90-day limit. Expect more restrictions, not fewer.
Tax environment: Mortgage interest relief doesn’t apply like it does for standard ASTs. VAT registration can creep in.
Guest risk: Damage, noise complaints, and neighbour hostility can all create real problems.
Market saturation: In some cities, everyone jumped on the Airbnb bandwagon. That means ADR drops, occupancy suffers, and margins disappear.
If you’re not building these into your models, you’re one council meeting away from a nasty surprise.
Why Investors Fall For the Myth
Because it’s comforting. The idea that three nights could cover a mortgage sounds like a cheat code. Who wouldn’t want that? But the property game doesn’t reward wishful thinking. It rewards precision.
The winners know their numbers inside out.
The winners don’t chase turnover headlines.
The winners model worst-case scenarios, not just best-case hype.
Airbnb is just another tool. Use it properly and it can be powerful. Use it blindly and it will drain your cash.
Final Thought
A profitable Airbnb isn’t built on a viral tweet or an Instagram reel. It’s built on structured analysis, cost control, and realistic yield calculations.
Yes, you can make money with short-lets. But profit doesn’t come from a few weekend bookings—it comes from deliberate design.
If you want to run Airbnbs that actually generate wealth, you have to go deeper than the surface numbers.
Because the £120k Airbnb myth isn’t just misleading—it’s a distraction. And if you’re serious about investing, you can’t afford distractions.
The Takeaway
The next time someone brags about six-figure Airbnb turnover, ask them one question:
“What’s your net?”
If they can’t answer without hesitation, they’re not running a business. They’re running a fantasy.