While you're jamming to great music working from home, ever get cabin fever? Airbnb is the go-to choice to escape the confines of your home/office/sometimes-prison.
Isn't it struggling like other businesses right now due to covid?
Yes & No.
Airbnb was founded in 2008 by Brian Chesky and Joe Gebbia then later, Nathan Blecharczy. They had the zany idea of just putting an air mattress in their living room in San Francisco and marketing that as a Bed and Breakfast. Yet now, Airbnb is a household name.
The founders are all billionaires at this point. The company was planning on going public this year, until the Corona Virus pandemic bottomed out many markets world wide.
Now, Airbnb bookings have tanked like Jurassic Park sequels.
According to AirDNA bookings in Europe collapsed in March, dropping 80% compared to the prior week in the week starting March 9, and another 10% on top of that for the week of March 16.
Today Sydney’s Opera House, Bangkok’s night markets, the Louvre Museum in Paris and the Colosseum in Rome are empty of those annoying tourists whose money generated significant income for cities, above & beyond just the gig economy.
Airbnb honored cancellations by all the guests despite how much this pissed off hosts. Founder Brian Chesky explained, in a letter to Airbnb Hosts,
"If we allowed guests to cancel and receive a refund, we knew it could have significant consequences on your livelihood. But, we couldn’t have guests and hosts feel pressured to put themselves into unsafe situations and create an additional public health hazard."
"We determined that we had to allow your guests to cancel and receive a full refund—including all our fees. Please know this decision was not a business decision, but based on protecting public health."
"However, while I believe we did the right thing in prioritizing health and safety, I’m sorry that we communicated this decision to guests without consulting you—like partners should. We have heard from you and we know we could have been better partners."
Airbnb intends to give a $250 million payout for the Airbnb hosts who lost income as guests canceled their stays due to the C-19 pandemic.
The founders are also creating a $10 million Superhost Relief Fund designed for Superhosts who rent out their own home and need help paying their rent or mortgage.
Not everyone views the economy crashing as a bad thing, for this particular industry. Critics bring up valid points on how Airbnb causes housing shortages as Short Term Rentals (STRs) are empty saved for Airbnbers while local residents can't find a place to call home.
Some of the most stinging critique comes from Lionel Laurent of the Bloomberg Opinion column:
"Paris has 100,000 empty homes and 100,000 second homes, according to the mayor’s office, fueling a sense of social injustice. One study of Airbnb in a Lisbon neighborhood between 2015 and 2017 found it looked less like a sharing economy and more like a buy-to-let craze, with 99% of short-term rentals marketed all year round."
I went to Paris for the first time last year and stayed in a charming chateaux, complete with a hookah and Pink Floyd on vinyl. But, like most tourists, I didn't consider locals may be put out by not having a place to rent.
Definitely food for thought. Laurent continues his comments here:
“Short-term rentals have had a disastrous impact on cities’ rental markets,” McGill University’s David Wachsmuth told The Intelligencer...Will a post-Covid-19 society really want that back?"
This is a good question, Laurent makes great points. Honestly, I think given the C-19 occupation limits and social distancing, Airbnb is a marriage of convenience that wins out over social justice concerns however justified.
It's more than just ease of use, staying at a vacation rental is now about safety and Airbnb offers a contactless check in & out system unlike most hotels.
While many things seem bleak, and doom scrolling frames things in a negative light ("It's sunny outside honey" "Yes but it must be part of a plot!") - there is an upside. We aren't losing Airbnb yet.
Airbnb's Windfall
For Airbnb hosts who have places in rural settings the market is booming thanks to cabin fever. Many want an escape and this is the perfect way to do so.
Rural hosts earned over $200 million dollars in just June 2020 alone, in the USA, according to Airbnb's newspage.
According to CNBC:
Trisha Mixer lost over $40,000 worth of bookings for her two properties outside Austin, Texas, when Covid-19 hit. But once the state started reopening in May, she said, she was “barraged” with requests. “You could tell people were desperate,” Mixer said.
Mixer’s two properties, a lake house and a cottage, are 30 and 90 minutes away from Austin, respectively, and the majority of her recent customers are other Texans — even people from Austin who just want to get away.
Summer weekends have always been popular, but this year she hasn’t had to do extra to fill up weekdays too. Mixer even raised prices a little to try to slow down the pace of bookings, but it didn’t work.
Her properties are filled through the summer, and weekend business looks steady through the end of October. On these getaways, just some space and, if possible, a swimming pool might be enough.
At Kathryn Langer’s property in Lake Travis, Texas, which sleeps nine people and does have the coveted pool, it is the “busiest and craziest” time in her four years of hosting on Airbnb. People are “stir crazy,” she said, adding that she had a guest who booked in May and then rebooked for August without having visited the first time yet.
Part of this is because of how scared people are of traveling now due to the added risks of catching the Corona Virus. It's much easier to find an Airbnb out in the country a few miles away from your city than it is to book a flight, wade through a crowd of strangers to and from your vacay destination.
In fact, I think I am going to have to check out some of the nearby lake view Airbnbs. This sounds like a safe easy get-away compared to braving an airport right now.
What about you? Willing to brave flying to an exotic destination, or stay in your state and hit up a rural Airbnb?
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