First Property - Art Airbnb

Just sharing a dream - I don't own property and this would be my first. If I were to pull the trigger. I don't really have anyone to discuss this with so I appreciate any comments..really.

Am interested in starting a small art school in regional Vic. ( I have family down there, and my goal thing is reaching out to regional communities )
It would be an art retreat / Airbnb / workshop presentation space.

I teach drawing so it's a bit of a passion of mine. I can teach it in English and Chinese and probably Japanese ( bit rusty! )

Will offer it as an art residence for folk in Melbourne / Ballarat and a place to present workshops for myself and visiting artists.
( I would advertise it in Art almanac and those sort of publications )
Target market are people in their 40+ who want a break from the city and a space to write / draw / watercolour etc. I will teach classes there.

I teach art in China at the moment, and will move back to Ballarat next year.
I just thought that normal Airbnb's are a bit boring. And there aren't any drawing or painting schools for adults in Ballarat or Ararat / Hamilton.

I have a 50k deposit and my broker says even with salary shading I can get it as an investment property.
I will rent a room in Ballarat. Ararat property Investment only.
My plan is to put a deposit on it with a long signing date, so I can save a bit extra in case of hot water heater issues blah blah. I hope to put away 3 months of salary in case of emergency.
Will also install shelves and stock it with art supplies I can sell.

Hope I am thinking in a business-like manner. Thanks for any comments.
Getting comments from experienced mentors is really appreciated.

 

What revenue would you need to break even, and how are you assessing demand for this business?

If someone is coming from the city, they would need accomodation and other activities as well. Are these available?

Is it possible to test this out first. Rent a property? That way you dont need to take on debt, save on buying costs and more flexible with cashflow.

 

@Depreciator has studio space (in Sydney) & @Gockie runs some traditional airbnb so could lend some experience in this space.

 

Who is your target market?
Where do they (mostly) live?

Ararat and Hamilton may be a bit far for city or interstate guests who aren’t driving. Choose a location handy to trains/buses from Melbourne and Tullamarine.

Have you researched demand? Jumping in and buying a property before establishing whether or not people will come seems risky. Can you rent premises first to see if the business idea is worthwhile?

 

Thanks for this Marg, SNMates and Trainee
Target market are people in Ballarat, women mostly aged 40+. I used to teach printmaking workshops in Armadale and Prahran at this demographic. Usually married, and art as a hobby. Ballarat is a growing city, will add 50,000 people in the next twenty years. Ararat is on a rail line. I have a cousin who teaches art in Ballarat and owns an Airbnb. I am waiting on some feedback from her.
To break even I need 957 a month to cover the mortgage.
Between $45 to $160 there are 8 airbnb properties in Ararat.
So it would be accommodation and a teaching space. I guess the distance is the issue. I need 8 stays a month at 120 a night to make a go of it. I would also invite overseas artists to come and stay to deliver workshops.

 

I like your thinking outside the square.

Your plans are multi pronged that "Will this be a good air bnb property" isn't quite enough

Good luck

 

I really like it. Airbnb has a scheme where hosts can add local activities and I'm sure the art classes/art retreat is something airbnb would think is a good local addon.

 

They are called 'Airbnb Experiences'. It's a whole other business model. I did an Airbnb Experience in Tokyo in January and it was great. The majority of people who run them don't have accommodation, they just do experiences. But some obviously do both. One catch with them is that if you offer an experience and you get only one taker, you still have to run the experience. So there is no minimum of participants. I was talking to a guy in Sydney who runs one and he said it took him a year to get traction and sufficient numbers.
Our airbnb is on top of my wife's ceramics studio (which is next to our house) and airbnb guests often come downstairs and make stuff or just have a drink and a chat. She doesn't do retreats or anything like that being in the city, but there are on occasion classes when groups want to do something.
https://www.thebakehousestudio.com.au/
The out of town art retreats market would be pretty seasonal. Also, the ones I have seen are in great spaces. You are right about the age of your target and the female skew. And if they are coming from Melbourne, they would often be cashed up. So the whole weekend needs to be an experience. The studio or teaching space needs to be fabulous and if accommodation is offered it needs to be pretty flash. So we are talking a decent investment. If you are just going to do day classes for locals, it will be easier.
Lisa recently did a an oil painting workshop with an artist a bit south of Sydney. He ran the class in his studio, which was modest, but he put on a great lunch. There was no accommodation offered. He is a known artist, so makes money selling work and doing classes - the classes are probably more lucrative
https://www.richardclaremont.com/
Lisa has a friend about two hours drive south of Sydney who does classes and has accommodation. Her studio is fantastic and so is the accommodation. She won the Archibald some years ago, but for her classes are where the money is.
Keep doing your research. Look at every person running classes/retreats within a two hour drive of Melbourne. Ideally, do a few of them yourself to see how they are run. It would be a great thing to do if you can pull it off.
Scott

 

If i were you, I would open a small gallery to teach Chinese kids in a Chinese populated suburb in Melbourne. Given you have taught in China and if you also have a westerner outlook, you would be surprise how much you can make by just teaching young kids simple drawing/painting techniques.

 

Hey,

Great idea, and I've seen something similar in Surry Hills, Sydney.
It was gorgeous though don't recall the address.

Janet Lee also has a book which has photographs of some funky eclectic studios she short term leases.



That stated, it is very much a business, and to avoid becoming a statistic on businesses failing in the first year, you may want to put together a business plan / proposal, and have it torn apart to find the gaps.

I once had a friend agonize over several months putting together this amazing plan to open a fish-farm in the Philippines. He needed over $1M to procure and establish a site (making up numbers here, it was 10 years ago).

His dad, who is a successful business man, took about 3 seconds to point out he should first rent a commercial site, and trial out to see if the model works. Like $30k. *DUH*.

Have you considered, renting a commercial space (a cheapie), or a resi-property with an allowance for sub-leasing. Trial out whether this would work. Total cost to you would be bare minimum, and if it doesn't take off, you can always rent it out as a normal rental to somebody else to cut costs.

Lean start.

My 2 cents.