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How to Start a Homestay Business: A Step-by-Step Guide

A homestay business allows people to rent out their homes or apartments to guests for a period of time. It is a great way to earn extra income while offering a unique and comfortable stay for guest or travelers. Starting a homestay business requires a bit of planning, but it can be a rewarding and profitable venture. This article will provide you the homestay business ideas required, and guide you through the steps involved in starting a homestay business, from finding a location to setting up the business and marketing it.

Is Homestay Business Model Profitable?

The homestay business model has been gaining popularity in globally as it offers a profitable venture. It has become a great option for people who are looking to make some extra money without having to invest too much capital. With minimal costs, they can earn a decent income while enjoying the experience of meeting new people. Additionally, homestays offer the opportunity to explore local culture and nature, which helps tourists connect with the local community.

For those looking to make a profit from homestays, there are several factors to consider. Firstly, one should select a location that offers good amenities and a comfortable atmosphere. Secondly, the homestay must be well-equipped with basic amenities and offer competitive rates. Lastly, one should focus on creating a unique experience for their guests by providing personalized services. With proper planning and marketing, homestay business owners can expect to make a profit in the long run. Here is how to setup a successful small business website in 2023

The homestay business model can be a profitable venture for those who are looking to make some extra money. By selecting a good location, providing basic amenities, and creating a unique experience for their guests, homestay business owners can expect to make a profit in the long run. With the right planning and marketing, this model has the potential to be a great success.

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Homestay Business Planning

Are you looking to make a steady income by launching your own homestay business? You are in the right spot! In this article, we will outline the advantages and disadvantages of operating a homestay. When planning a vacation, the first decision to make is where to stay. Options typically include a hotel, hostel, or homestay. People who are travelling alone usually opt for a hostel, while families generally prefer a hotel or homestay.

Staying in a homestay is quickly becoming the go-to choice for tourists in Africa. With its small crowds and a true taste of rural life, it’s no wonder homestays are a popular option. To get the full experience, many homestays are situated in areas that are mostly off the beaten path. From mountain ranges to villages, forts, and forests, there are endless destinations for a homestay getaway.

Not only does a homestay provide a unique experience, but it also brings with it several benefits. Visitors may get a glimpse into the everyday lives of locals, as well as a smaller carbon footprint than a hotel. All in all, it’s a great way to see the world while doing your part to help the environment. Check out 12 Home based businesses you can successfully do in 2023

What Is Homestay In Africa?

Homestay in Africa is an increasingly popular lodging option for visitors. Fully-furnished with smart TVs, refrigerators, washing machines, and more, these rentals provide a comfortable and convenient home-away-from-home. Unfortunately, some of these homestays lack Wi-Fi internet services, and usually have a set schedule for food service and room cleaning. Read also 10 Basic Requirements for Setting up Overseas Business

Regardless, homestays in Africa are gaining traction with tourists, particularly in Uganda, Botswana, Madagascar, Kenya, Nigeria and Ethiopia. In 2019, the number of homestays in each of these countries alone was estimated to be 4600, making it an attractive market for this low-investment business.

homestay business

How to Start a Homestay Business?

You can begin your homestay business with minimum capital and yet, earn some passive rental income for your family. There are four major factors that fuel the success of this business and these are:

• Hospitality
• Layout
• Cleanliness
• Commitment

With these four factors in place, you will not experience business failure. Below is a detailed guide on how you can start a successful homestay business:

1. Research and plan

Research the local regulations and laws that govern homestays in your area and make sure you are aware of any special requirements or permit that you will need. Look into potential competitors, and identify the key aspects of their services that you can use as a benchmark for your own business.

2. Design the space

Plan out the layout of the space, taking into account the number of guests you can accommodate and the amenities you plan on offering. Consider what furniture and fixtures are needed, and their placement in the space. Are you a college student looking for how to make some extra money, here12 Profitable business ideas for campus students updated

You can also partner with your friend to hire any kind of apartment of your choice in a chosen location. It does not have to be a very large house. A spare bedroom in your apartment can serve for this purpose. Just a minimum of one room to about six rooms is good enough.

3. Prepare the space

The next thing to do is to prepare the place bearing in mind that you will be hosting persons with different tastes, views and opinions about life generally. Make sure the space is clean enough and in good condition before welcoming guests. Ensure all the furniture is in the right place and check for any repairs or replacements that might be needed.

4. Licensing

Securing a homestay license for your residence or property should be one of your most significant objectives. To register with the tourism department, you need to fill out and submit an application form. Moreover, you must also secure authorization from local authorities and the police.

Each state tourism board has particular standards that must be met concerning the basic amenities, room measurements, safety guidelines, etc. for granting homestay licenses. Moreover, another important condition for getting a license is that the proprietor of the homestay should be living there with their family. In the event that the property is rented, you must inform the landlord about the sub-leasing and secure his approval.

Anyone hoping to acquire a license for an establishment of a homestay business has to provide the following documents for application for license:

• Proof of ownership or lease of the facility being used.
• Location plan that indicates access from major roads.
• Layout of the building, including plans and elevations.
• Pictures of the building, both inside and outside.
• Police Clearance Certificate.
• Authorization from the local authorities.
• Environmental Clearance Certificate.
• Financial documentation showing proof of resources.
• Affidavit from the applicant.

5. Keep Systems In Place.

As earlier said, your homestay should be clean, organized, safe, and well-stocked with the basic human needs. Your cleaning staff should have a checklist to ensure everything is readily in place. A healthy and hygienic environment must be provided for your guests, and the proper standards as laid down by the regulatory authorities must be maintained. Be reminded that security and fire safety are very vital. Having a provision made for any eventualities such as a guest falling ill for instance will be an added advantage.

homestay business

6. Customer Service

In order to ensure excellent customer service and address any issues that may arise, it is essential to always strive for improvement. Put yourself in your guest’s shoes and consider what they would find important and beneficial. Being honest with your guests is the most effective way to ensure a pleasant experience.

High-speed internet is a necessity for many guests, so make sure this is provided for them. It is also important to provide honest information about the accommodation. For instance, if there are stairs leading to the apartment, be sure to inform your guests of this prior to their arrival.

7. Keep Costs Records

Keeping costs under control is an essential part of running a successful homestay business. Knowing the expenses associated with hosting guests is paramount to establishing a fair price for your services. Keeping accurate records of income and expenditure will allow you to better understand the costs of running your business, and to ensure that you are setting a competitive rate.

Research what other similar accommodations are charging and use this as a guide when determining the price of your services. By managing your costs and staying competitive, you will be well on your way to a successful homestay business.

8. Precautions

Choosing the right guests for your premises is essential for maintaining a positive reputation. To ensure a successful event, it is best to stick to small families and groups from a company. Avoid any guests with alcohol or drug addiction and those who are likely to create a raucous atmosphere. Carefully selecting the right guests will help prevent any disturbances or other issues that could damage your reputation.

9. Set rates and policies

Research the local market and set competitive rates for your homestay services. Decide on the types of policies you want to set for your guests and make sure you are clear about them when advertising your services. Below are examples of rates and policies you can adopt.


1. Room rate: The rate for the room should be based on the size and amenities the room offers.
2. Cleaning fee: A cleaning fee should be charged to cover the cost of cleaning the room after each guest leaves.
3. Security deposit: A security deposit should be charged to cover any damages caused by the guest.
4. Additional fees: Additional fees may be charged for extra services such as laundry and breakfast.


1. Check-in and check-out: Guests should be allowed to check-in and check-out at any time, as long as the room is available.
2. Cancellation: Guests should be allowed to cancel up to 24 hours prior to their arrival date without penalty.
3. Age requirements: Guests should be 18 years old or older to book a room.
4. Pets: Pets should not be allowed in the homestay.
5. Smoking: Smoking should not be allowed in the homestay.
6. Maximum occupancy: The maximum occupancy should be clearly stated, and guests should not exceed the maximum occupancy.
7. Noise: Guests should be respectful of other guests and not make excessive noise.
8. Respect for property: Guests should be respectful of the homestay property and should not damage or remove any items.

homestay business

10. Promoting Your Homestay Business

You can use a combination of traditional and modern marketing techniques to promote your homestay. You can use print media and television for advertising. You can also network with travel agents, tour operators, etc. and offer them discounts. You can also use social media platforms such as Facebook, Twitter, Instagram, and YouTube to reach a wider audience.

You should also make sure that your homestay is visible on local search engines and directories. You can also make use of local events or festivals to promote your homestay by setting up a stall or distributing leaflets. You can also use content marketing to create interesting articles about your homestay, and share them on social media. This will help you build your brand and attract more visitors. Amazing benefits of using expired domains to boost your business website

Finally, you should monitor the performance of your marketing campaigns and keep track of the results. With the help of analytics, you can identify what strategies are working and which ones are not. This will help you focus your efforts on the more successful strategies and make changes to the ones that are not working. See these10 low cost business ideas with high profit in 2023

11. Prepare for guests

Make sure you and your facility are fully ready for your guests before they arrive. Prepare a welcome package for them and stock the kitchen with basic necessities. Make sure the house is clean and comfortable for your guests and let them check in with smiles.

With these steps, you can start a homestay business and make some passive rental income. To be successful, however, you need to create an attractive and welcoming space, maintain cleanliness, and provide excellent hospitality. With a little planning and effort, you can create a successful and profitable homestay business.

Now, read also 12 FAQs on How to Start a Homestay Business

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