Why Renting Properties Below RM2000 is the Best Way to Start Your Homestay Business

The short-term rental (STR) industry in Malaysia has evolved significantly over the years, with increasing competition and shifting guest preferences. Many new Airbnb hosts enter the market by purchasing properties, but for beginners, renting a property for Airbnb under RM2000 per month is the ideal way to start.

At MyRehat, we have operated a wide range of properties, from studios to three-bedroom units, most of which are located in Kuala Lumpur and Selangor. Our experience has shown that starting with lower rental commitments is the most sustainable and profitable approach for newcomers to this business. 

Let us tell you why.

Understanding the profit-sharing model

One of the best ways to operate an Airbnb business is through a profit-sharing operational scheme, whereby property owners partner with STR operators like MyRehat. This model allows operators to manage the unit without paying fixed rent; instead, profits are split between the owner and the operator.

MyRehat has successfully managed properties under this scheme, such as STAR Residences KLCC and Tropics Condominium. This approach minimises financial risks while allowing property owners to benefit from short-term rental income.
 

However, profit-sharing opportunities are not always readily available, so many operators must resort to renting properties outright.

Why high rental costs can be a pitfall

While the profit-sharing model is ideal, not all property owners are open to it. As a result, MyRehat has also rented properties to run our accommodation business. However, we have learned that leasing high-end properties with monthly rents exceeding RM4500 can be financially challenging.

For example, when we rented a unit for RM4500 per month, the cost of utilities, maintenance and Airbnb service fees added up quickly. Despite high occupancy rates, the profit margins were razor-thin. In some cases, we even faced losses, proving that high rental commitments can be unsustainable in the long run.

Lessons from 2024: The impact of market changes

2024 has been a particularly tough year for the short-term rental market. Properties that used to be reliable income generators are now facing stiff competition and shifting guest preferences. However, what we’ve discovered is that properties rented for RM2000 or less per month remain profitable, even during market downturns.

Case Study: 1-bedroom unit at a property near Sunway Putra Mall

One of the best-performing properties in our portfolio is a 1-bedroom unit at near Sunway Putra Mall, Kuala Lumpur rented at RM1650 per month. Here’s a comparison of its revenue:

2023 Total Revenue: RM65,246

2024 Total Revenue: RM53,778

Despite a drop in revenue due to increased competition and changing customer demands, this unit remains profitable. Its lower rental cost provides a higher safety margin, allowing us to maintain positive cash flow even in slow months.

Why RM2000 and below is the ideal starting point

In a nutshell, if you are new to the Airbnb business, renting a property for RM2000 or less offers several advantages:

• Lower financial risk: You minimise fixed costs, making it easier to break even and turn a profit.
• Flexibility to experiment: With lower commitments, you can test different pricing strategies, amenities and marketing techniques.
• Higher profit margins: Since rental cost is the largest expense, keeping it low ensures better returns.
• Adaptability to market changes: If guest preferences shift, it’s easier to pivot when you are not locked into an expensive lease.

MyRehat’s experience shows that lower rental commitments help sustain profitability, even in tough market conditions. Want to learn more? Join our Masterclass Gergasi on 21 June 2025 (English session) or 19 July 2025 (Bahasa Malaysia session) for an in-depth guide on running a successful Airbnb business. Sign up now at myrehat.com/masterclass.

Or, if you’d like a preview, join our free learning sessions at myrehat.com/events-happenings to gain insights into the business.

By starting small and smart, you can build a profitable accommodation business without taking on excessive financial risk. Happy hosting!

Disclaimer: The contents of this blog are for informational purposes only. They are not intended to be professional or expert advice. They are the operator’s personal opinions and experiences which may not necessarily reflect the opinions of any organisation or company that they are affiliated with. All investment strategies and investments involve the risk of loss. Nothing contained in this website should be construed as investment advice. Any reference to an investment’s past or potential performance is not, and should not be construed as, a recommendation or as a guarantee of any specific outcome or profit. We reserve the right to change the overall content and focus. While we try to be as accurate as we can, there may be errors or omissions. We are not able to disclose all information needed to assess a particular situation. Please consult an independent professional advice for your specific needs.