PRIOR TO THE COVID-19 pandemic, traditional hotels in the U.S. were very concerned about competition from newcomer Airbnb. Now, both forms of lodging are in the same boat, trying to stay afloat in an industry rocking storm, according to a survey of Airbnb owners by Investment Property Exchange Services (IPX 1031).
The survey of owners found hosts have lost an average of $4,036 each since the COVID-19 pandemic began and they expect to lose more over the summer. Also, 47 percent of respondents said they don’t feel safe renting to guests while 70 percent of guests are fearful to stay at an Airbnb right now.
“These revenue losses have led 41 percent of hosts to supplement their income with another job or revenue stream for the time being,” the IPX 1031 report said. “Hosts have also gotten creative with their properties with 47 percent offering month-long stay options and 29 percent listing their properties at reduced prices to front-line personnel such as medical professionals who are traveling during this time.”
The report also said some Airbnb have listed their properties on rental markets such as Zillow and Apartments.com for limited leases to create consistent revenue.
Other findings include:
- 64 percent of guests either have cancelled or will cancel an Airbnb booking since the pandemic started.
- Airbnb hosts expect a 44 percent decrease in revenue this summer between June and August. Hosts have dropped their daily rates as much as $90 on average.
- 45 percent of hosts said they will not be able to sustain operating costs if the pandemic lasts another six months.
- 16 percent have already missed or delayed a mortgage payment on one or more of their properties.
There will come a time when the pandemic ends, however, and 37 percent of owners believe guests will return this fall.
“But guests appear to be a little more eager to book. According to respondents, 26 percent said they’ll feel safe booking again this summer, which could be good news for hosts who look to recoup lost revenue from the spring,” the report said. “In the meantime, [30 percent of] guests are taking advantage of Airbnb’s virtual experiences, which are online activities led by Airbnb hosts that include everything from online cooking classes to dancing lessons.”
The traditional hotel industry has long been concerned with the threat from Airbnb and similar platforms, pressing local and state governments to do more to regulate the stay-sharing industry. The hospitality industry also has suffered in the pandemic, with occupancy dropping substantially since March and with it revenue and profit.