Are you affected by SXSW 2020 being cancelled?

Question

I know the news just broke and it might be too soon to tell. But I would love to learn as a case study for investing in AirBNB and other STR. How much revenue does SXSW bring to the Austin investors and how will the lack of the big event affect your annual revenues?

Bill B. · Answer

The number of people wearing masks is actually way down from previous years in Vegas. Maybe they’ve finally seen the news reports about how they don’t help. Or the reports about how only 1 person in Nevada has caught it. Or how the flu will kill 200 times more people.

Edward Liu · Answer

Short term rentals is the 1st market to die during the virus - even before the airlines. I have friends who holds hundreds prime short term rentals in China, Korea and Japan. All said for the past 6 weeks, short term rental market has fallen to ZERO - literally zero business. People do NOT travel at all for being scared. Same thing is happening in Italy.

I feel it is starting in the US. I am skiing in Lake Tahoe this weekend, and my Airbnb rental (great location) is the cheapest I have ever got. Such low rates is likely due to low demand already. If you have lot of short term rentals, my suggestion is to build up some cash to weather the storm - extra cleaning will not help.

Kelly Iannone · Answer

@Jonathan Conaghan there have been multiple conventions canceling in Orlando. Healthcare Information and Management Systems Society's global health conference, The Grainger Show, and McDonalds worldwide conference are all larger size events that cancelled. My W2 role has me in the heart of knowing what’s happening in the accommodations business and strategic discussions on how to mitigate impacts. Needless to say, it’s been a crazy week with little time to focus on REI.

John Underwood · Answer

I wonder how this will shake out.

Will more people travel and stay domestically? Will people just not go anywhere?

Should we take extra measures when having our properties cleaned between guests?

Most of this is a wait and see I suspect.

Michael C. · Answer

@Nathan Estochen

I have friends who operate in Seattle and it’s really bad out there for STRs - especially for operators using a pure lease arb strategy.

Nathan Estochen · Answer

A STR in East Austin I’ve seen the numbers of (not mine) had on average an 80% jump in revenue in the month of March year over year, no doubt due to SXSW.

Outside of REI it’s going to be interesting to see how local businesses rally to still hold events.

Jonathan Conaghan · Answer

@Arian Moreno not related to SXSW, but I own an STR in Kissimmee and just received my first cancellation request for later this month related to the coronavirus. A conference a guest was schedule to attend in the area might be cancelled and that coupled with concerns over the virus prompted them to ask about cancellation.

Ryan Kelly · Answer

@Arian Moreno SXSW is a massive boon to Austin and most AirBnB properties can see 400+% increases in rent amounts during the convention. I expect the cancellation was at least a $300-400 million dollar hit to the local economy. It isn’t affecting residential sales in anyway, but will definitely hurt the short term rental market and local businesses.

Account Closed · Answer

Just bring your can of Lysol along. ;-)

Michael King · Answer

We have paid a deposit for a VRBO in Destin FL for a June stay. I've asked my wife to check on canceling it, since, well you know, the virus.

I work in EMS. I think I'll start carrying an N95 mask with me everywhere now.

Are you affected by SXSW 2020 being cancelled?

Are you affected by SXSW 2020 being cancelled?

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