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Landlords return to long-term rentals as Airbnb loses its shine


#1

"Melbourne landlords return to long-term rentals as Airbnb loses its shine.

The Airbnb gold rush appears to be ending, with fed-up landlords returning to the long term rental market after the short term becomes more trouble than it’s worth, agents say.

Difficult and hands-on management, less-than-ideal profits, and a saturated market were turning investors from the one-time disrupter, which was no longer seen as easy money."

This was the start of an article in The Age Domain, our main local newspaper’s real estate section, You can read the rest here.

I see daily articles in the media that mention AirBnB. They usually fall into two categories. The first is people complaining about lack of LTRs blaming it on AirBnB. The second is tangential associations like “Man shot dead after argument over AirBnB payment” or more usually “Teens run amok after police shutdown AirBnB party”. But AirBnB is a hot topic so if there is a connection they’ll mention it in the headline.

Anyway it would good for those who stay if ABB loses hosts as (1) there is less competition and (2) ABB might go back to a more host friendly model. But I wonder if it is even true. First it is real estate agents saying it and they lose on rentals because of ABB and secondly the number of ABB hosts in Melbourne actually increased by 18% in 2016/17. Maybe they mean whole home by-to-let investors rather than run of the mill room renters. I’ve noticed a new whole house property in my street which was sold earlier this year and has just gone on AirBnB. They are charging way too much so I hope they are not relying on it to pay the mortgage.

There was a post back in August '17 where someone said they had seen LTR back in their neighbourhood. Is anyone seeing similar articles in their own local press? Does it tie in with their experience?


#2

I think it is here to stay. What stats are they using to back up their assertions? They interviewed a few people who were tired of doing Air? Small sampling sure,

I like their term “the one time disrupter” which just proves that as a concept Air is maturing and personally, I think they will soon begin to run roughshod over hosts, most of whom will roll over and ask for more.


#3

I think someone met someone at a BBQ who was jacked with ABB so the journalist got in contact and constructed the story. Interviewing realtors is hardly evidence. I know quite a few journalists and none of them strike me as people who let the truth get in the way of a good story. Than again I am always amazed when I see the AirBnB map of Melbourne which has 4.5 million people and over 20,000 registered AirBnB addresses. 12,500 whole homes, 7,500 shared homes and 500 private rooms.


Is Airbnb hosting worth it? (Australia)
#4

Sounds like.it.was pulled by ears. There are some hosts who have full time jobs or consider Airbnb their extra pocket money or have other priorities. I talked to couple of them who switched bAck to long term guests and the reason was lack of time to do their other job. I like longer term guests like a months or two. I make 3 times more this way that holding a lease and rent it for a year or two.


#5

was it ever a goldrush in Australia? From what I’ve read, it’s very low takings in general, trying to run an airbnb.


#6

And it makes me chuckle. For years, landlords have offered long term rentals. Then gradually, they found out about Airbnb and read the hype and thought it would be a great way to make more money.

The trouble was that these people were landlords, not hosts. They weren’t bothered about giving guests a good time at a value-for-money price. They weren’t prepared to do the work (or pay anyone else a decent wage to do it) required to offer better-than-hotels cleanliness. They weren’t prepared for the huge amount of work hosts have to undertake if they are going to be successful.

They thought that if a guest broke a wineglass or stained a towel, then the Airbnb host guarantee would see to that. They thought that all they had to do was develop stringent house rules to make sure that the guests behaved. If they didn’t behave, they thought, then Airbnb would see to it. Chances are that they didn’t even do their sums correctly so ended up not making more money than LTR at all - and with so much hassle.

It’s hardly surprising that after a while they bottle it and return to long term rentals.


#8

We’ve had a few gold rushes here in Australia. This isn’t one of them but the media is a bit fixated on AirBnB now they have moved on from Uber. They seem to be transferring their attention now to Amazon so there will be lots of “Amazon parcel two days late says area man” type headlines.


#9

This could be a story pitched by the hotel lobby you know.
Once upon a time I worked in PR in an ad agency and hated it (thankfully I’m strictly an ad copywriter now), but I would have to call editors and try to pitch stories on behalf of our clients that sounded like editorial. I would them write them and hope the editors would use it verbatim. They were meant to influence readers.

Media is super slanted. It’s super easy to write something that is slanted toward one view or the other.

This story was probably pitched by an enemy of STRs, whether it is a hotel lobby or someone else.

Can’t believe everything we read!! :laughing:


#10

I don’t believe you, etcs!


#11

Speaking of which a local weekly tv lifestyle program “The Living Room” here suddenly did a story where all four presenters went to Hawaii for one program!!! Strange it was only advertised a week in advance. And when they got there there was absolutely no mention of the famous volcano! I guess they must have paid for the trip themselves and just decided the volcano was a getting too much press. Mostly it featured things you can do on other islands, away from the volcano! It wasn’t a very subtle message but it did show there are lots of non vulcanic activities to do. I would still like to go one day and visit the remnants after the volcano has (apparently) destroyed everything. :japanese_goblin:

You can see why they are paying shows like this to visit and present a positive image when the one (volcano related) news story on Hawaii this week was of a crazed guy threatening to shoot people as the lava slowly engulfed his yard.


#12

He was charged with a multitude of crimes. He was a felon and never should have had a gun to begin with. Those weren’t looters, those were residents who were checking out their place where their property was was.

There’s CD roadblocks and barricades. You can only get in if you can prove residency.


#13

Especially in Murdoch newspapers!


#14

I’m with @jaquo there is a difference between landlords and hosts. Its the difference between a product and a service. A landlord that manages an Airbnb like a product is going to fail.


#15

I just took my STR in piedmont NC to LTR only. This area is not a “vacation destination”. When I started with my rental there were very few STRs in my area.

3 years later there are 3.5 x as many with low low low rates I can’t compete with. My guests have left good reviews. (Super Host)

After STR taxes and cleaning fees, towel & linen replacement & dealing with the rare but infuriating guest who wants champagne accommodations for a bottled water price, I’ve thrown In the towel.

I genuinely like the guest interaction but I am doing this for revenue, not to be social. The price race to the bottom killed mine. It was a not lack of hosting skills or lack of understanding what work was required that caused me to change.

After doing the math based upon the current market, I make more with less work by doing LTR.

Conversely, my 2 beach area condos are “rocking & rolling” with good rentals. It’s all about the market for me.


#16

I started taking back longer termers based on personality in October They are willing to help. We just had a biweekly team meeting. It helps too. The maintenance is so much lower. You have to consider your own happiness. And your manicure.

Our last guest was ace but the previous one was high maintenance. The only reason I catered was the review. For the money it wasn’t worth it.

Like many of you I am screening much more tightly for fit. We are a team here and I have no time for lords and ladies with dime store manners!


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