Sydney vacancy rates reverse course, tightening further
Rental vacancies in Sydney did not continue on the trajectory recorded last month, with available properties in the city...
The company’s latest earnings report revealed that almost a quarter of the company’s bookings in the first quarter of 2021 were for long-term stays of 28 days or more.
According to one of the world’s most popular vacation rental companies, “guests aren’t just travelling on Airbnb, they are living on Airbnb”.
Airbnb’s latest financial results revealed that an increasing number of guests are discovering that they do not need to be tethered to one location to live and work.
In an interview with The Verge, Airbnb CEO Brian Chesky predicted that long-term stays will continue to grow in popularity on the platform. Eventually, he said, tenants will lose interest in traditional one-year leases.
“I think eventually in the future, people will start paying for rent the way they pay for cable television, or for Netflix, you pay on a month-to-month basis,” he said.
While the appeal of replacing the analog experience of long-term property renting with a digitally native platform like Airbnb may appeal to both potential landlords and occupants, Mr Chesky did not touch on how such a shift could impact the rights of either party under existing property laws.
Mr Chesky claimed that Airbnb’s trust and safety team is more sophisticated than what landlords currently use. While Airbnb will continue to vet long-term guests, it won’t do so through traditional methods like making them submit a credit score, deposit or proof of income.
Speaking to Smart Property Investment, Archistar’s Dr Andrew Wilson admitted that Airbnb has an interesting proposition but expressed doubt at their ambition.
“I’m not sure they’re going to work their way into the permanent rental market,” he said.
Dr Wilson said the growth of Airbnb into the long-term accommodation niche is more indicative of the higher demand for fully furnished rental accommodation and the closed border environment of the pandemic.
He expects their presence in the market to wane once the borders reopen and questioned the possible impacts of this proposed change on landlords offering short-term rentals.
“I’m not sure that the benefits for that, in terms of the lower rentals you do get for a longer-term rental, would mean that those typically used to have a shorter-term rental would find it financially viable.”
Dr Wilson noted that any move by Airbnb into the long-term rental space would see them battle not just the expectations of those who see Airbnb as synonymous with short-term accommodation, but also competition from existing rental portals like REA and Domain.
While Dr Wilson conceded that there may be a business opportunity for Airbnb as a lower-cost listing alternative to established players, he said that the company would still have to grapple with the challenges of bringing long-term landlords and tenants together in a listing market.
“Perhaps Airbnb are thinking to themselves, ‘Why can’t we compete and become not just a short-term landlord-tenant meeting place, but one for the bigger picture, which is all tenants?’” he said.
“That’s the endgame for them: to become a total rental market. There’s some logic to that. If you’re capturing one part of the market, why can’t you do the lot?”
A term is defined as the fixed period of validity and conditions of a contract for a loan, real estate transaction, and other legal agreements.