Effects of COVID on AirBnB

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Effects of COVID on AirBnB

Stephanie Reinagel
Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes

Hey all. I'm wondering if anyone has Airbnb properties that can speak to how COVID has affected your occupancy rates. I've heard some say numbers are down and other day they're up. I'm looking to get into AirBnB but don't want to commit to the initial time and financial investment if the numbers are way down. Does anyone have resources to see the actual data for my area? I'm in the Phoenix area.

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Carolyn Fuller
Cambridge, MA · Member since 2015 · 652 posts · 736 votes
5y

I think location makes a huge difference. Think about it. Where did you want to escape this past year? New York City? Boston? Probably not. The sea shore? The mountains? Lake region? Probably. 

Traditional vacation spots did very, very well in 2020. Urban markets, not so great. What will happen in 2021? Think about what you, your family and friends want to do as soon as life begins to look normal again. 

My husband and I traditionally schedule a week on the Cape each year. We extended it to 3 weeks in 2020 but we have not made Cape Cod reservations for 2021 because we aren't sure that is what we want to do when we come out of the long hibernation. We miss vibrant urban activities and we just might want to reserve all our 2021 vacation time to immersing ourselves in urban life again. 

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  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    5y

    My Vrbo vacation rental had the best year ever in 2020 even after shutting down the month of April due to stay at home orders.

    2Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    5y

    Hey @Stephanie Reinagel, like @John Underwood we have had our best year ever in 2020 and 2021 is shaping up to be even better.

    Welcome to the forum! Take a bunch of time and use the search function on your questions. There are at least 10 threads on this exact topic with lots of info. Anything you could need are in the forums.

    3Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @Michael Baum thanks for the info! Could you point me to some other threads. I searched "Airbnb COVID" and didn't see anything that answered my questions.

    0Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @John Underwood awesome! Congrats on a great year, and thank you for your help!

    0Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    5y

    I keep telling folks to search, but man the basic search function stinks. Try changing to Covid-19. That will help. i get over 100 pages of posts, but that is from all the forums.

    2Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    5y

    This has been discussed many times and almost everyone said they saw increased business in 2020. People wanted to travel, but they didn't want to fly or stay in a hotel where they would be jammed in with others. It was the perfect situation for vacation rentals.

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  • Carolyn Fuller
    Cambridge, MA · Member since 2015 · 652 posts · 736 votes
    5y

    I think location makes a huge difference. Think about it. Where did you want to escape this past year? New York City? Boston? Probably not. The sea shore? The mountains? Lake region? Probably. 

    Traditional vacation spots did very, very well in 2020. Urban markets, not so great. What will happen in 2021? Think about what you, your family and friends want to do as soon as life begins to look normal again. 

    My husband and I traditionally schedule a week on the Cape each year. We extended it to 3 weeks in 2020 but we have not made Cape Cod reservations for 2021 because we aren't sure that is what we want to do when we come out of the long hibernation. We miss vibrant urban activities and we just might want to reserve all our 2021 vacation time to immersing ourselves in urban life again. 

    6Reply
  • Account Closed
    Specialist · Bozeman, MT · Member since 2016 · 237 posts · 153 votes
    5y

    My property management company manages ABB's (and VRBO's) in Gallatin and Park Counties in Montana. We haven't had any slowdown at all. I manage a few of my own in Bozeman, and others for clients in the surrounding areas. At first, when Covid hit, we lost 95% of our bookings. Then out of nowhere, after a few weeks, we started getting inquiries for full price, for like 6 -8 weeks at a time. Over and over again, our guests would tell us the same story: they wanted to be in a place they could work online, and enjoy the outdoors, while staying away from the crowds. And so long story short, we increased pricing, and had the best year yet. In fact, I was recently shopping around for SBA loans, and one of the questions the underwriter stressed was "How has your business handled Covid, and have you recovered yet?" They asked me this like our industry was hit hard or something. Anyways, I think Covid has entirely bypassed real estate, at least in my area. 

    3Reply
  • Mark Futalan
    Rental Property Investor · La Quinta, CA · Member since 2018 · 263 posts · 95 votes
    5y

    @Stephanie Reinagel

    When things opened back up after the initial covid shock, short term rental demand was very strong. What may have happened with the up and down was the city and states adjusting to local regulations and ordinances. We had a stay at home order in December when the spike in cases came up. Now things have been crazier than ever and RE demand has been insane with homes getting multiple offers above asking in my area in the desert.

    0Reply
  • Onan Dumas
    Investor · Rowlett, TX · Member since 2013 · 132 posts · 72 votes
    5y

    @Stephanie Reinagel

    We are absolutely crushing it. Our occupancy is better than ever which has allowed me to raise the per night stay and reduce my occupancy once again. I prefer to be the 60-70% occupancy with max income, this reduces my utility bills, cost of cleaning, supplies, and less chances of any issue guests (which hardly ever happen). Our properties are located in suburban areas, nothing vacation spot related about them and still doing great.

    I’ve said it before on here and I’ll say it again, the hotel industry won’t ever look the same post covid. People want the space. They want the peace of mind that comes with having an entire home or mid sized condo/townhome without the worry of being stuck like sardines next to each other. Short term rentals are going to see a climb moving forward.

    3Reply
  • Dan Schwartz
    Real Estate Investor · Tempe, AZ · Member since 2012 · 874 posts · 648 votes
    5y

    @Stephanie Reinagel are you looking to buy in Phoenix/Scottsdale market, and do you plan to operate it yourself?

    0Reply
  • Steve Morris
    Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
    5y

    OK< have farmhouse in wine country in OR.  It'll be retirement house, but wife convinced me to try VRBO, so I was wrong.

    The place has about 80% occupancy.  Talked to my PM and she thinks since it's larger than a hotel room (4 beds and there aren't a lot of nearby hotels) I can get families with pets (which I allow since I took out all the carpeting) and there are no co-tenants (ie other hotel rooms) for a disease vector.

    Again, I was wrong and am happy, but I can see communities either raising taxes or refusing new permits (great for me) or just not allowing them (not so great for me).

    Also, location helps a lot plus room to park/live.

    My un-educated opinion.

    1Reply
  • Ralph Pombo
    Member since 2020 · 101 posts · 34 votes
    5y

    Well unlike others, our experience has not been good. Our AirBnb is in Hawaii. To make things worse, it is on the island of Kauai which is the most strict of all of the islands. Our occupancy rates went from an average of 98% down to zero. We have had very few occupants in the last year. With sky high HOA fees and taxes, you can imagine that this has hurt us financially. Luckily, we had a pretty good sized capex fund just in case. That sustained us through the first nine months. We are now having to pay in at a rate of over $1200 a month and not being allowed to even use the property ourselves.

    0Reply
  • Mike V.
    Rental Property Investor · Campbell, CA · Member since 2017 · 419 posts · 499 votes
    5y

    @Ralph Pombo, I also own multiple units In kauai and the Mayor has done a horrible job. I’ve been bleeding money for the last year while million dollar properties sit empty. It’s one thing to enact restrictive policies, but it’s completely another to change their policies every month so that no one knows how to plan. The lack of consistency on kauai has made it impossible to even attempt to work within the rules.  

    0Reply
  • Ralph Pombo
    Member since 2020 · 101 posts · 34 votes
    5y

    @Mike V. - It is so sad to watch. Not only is it financially devastating to us, but most businesses have closed and will never reopen again. The leadership is insane.

    1Reply
  • Rachel KokosenskiPro Member
    Realtor · West Michigan · Member since 2017 · 105 posts · 53 votes
    5y

    @Stephanie Reinagel - my STR had a great 2020 as well. The key that I found was to change my cancellation policy to the most flexible option. It seems that people needed that peace of mind in order to feel comfortable booking. I've decided to leave it as "most flexible" because even though people can cancel easily, I've also gotten replacement bookings very quickly. Much of my summer is already booked and it's just the beginning of February.

    Another trick that I do each year: in January, I send out an email to all my renters from the previous year and offer them 10% off to book again with me for this year. It's amazing how many people take you up on this offer! (I did have one guy write me a snarky email, but I just ignored him.) Best of luck to you with your property!

    2Reply
  • Kelly Layne
    Smithland, KY · Member since 2017 · 12 posts · 0 votes
    5y

    @Stephanie Reinagel .... we have 15 doors and decided to make one into an Airbnb. Just launched on January 29th in western Kentucky. (So not exactly a Mecca for most travelers). We have seen an incredible response. (Took the advice of others and had professional photos done of the place). Only spent a little under two thousand on getting it up and going (furniture, accessories etc). We had an exit strategy of just transitioning it back to a long term rental if it flopped. Very little to lose in terms of risk.

    0Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @Nathan G. That makes a lot of sense! Thank you!

    1Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @Carolyn Fuller great insights! I'm in a metro area, so maybe people will be wanting to enjoy the city life again soon! 🤞

    0Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @Onan Dumas thank you for your insight! I'm glad to hear it!

    0Reply
  • Stephanie Reinagel
    OP
    Rental Property Investor · Mesa, AZ · Member since 2021 · 20 posts · 15 votes
    5y

    @Dan Schwartz I'm actually planning to rent to Airbnb to start out. Then eventually buy, after I've build up some savings.

    0Reply
  • Carolyn Fuller
    Cambridge, MA · Member since 2015 · 652 posts · 736 votes
    5y
    Originally posted by @Stephanie Reinagel:

    @Carolyn Fuller great insights! I'm in a metro area, so maybe people will be wanting to enjoy the city life again soon! 🤞

    All I can is city life is what I have missed the most this past year. One of my fondest memories pre-pandemic is a conversation my husband and I had with a perfect stranger. Zoom has kept us connected to friends and family but there has been nothing to replace those chance encounters and I MISS THEM!

    0Reply
  • Gael Yimen Yimga
    Member since 2021 · 11 posts · 5 votes
    5y

    Hi Everyone, Let suppose you have a property with the following characteristics that is not renting. Is it possible to do AirBNB on a property that you are not living in ?

    0Reply
  • Benjamin AakerPro Member
    Rental Property Investor · Brandon, SD · Member since 2015 · 1k+ posts · 1k+ votes
    5y

    I have a 4 unit motel I rent with AirBnB. I saw a dip at the start of the pandemic. I started seeing people want to rent for longer periods so I changed the settings to make the prices work for that. Now, I rarely have vacancy and people are staying longer so there is less turnover charge. This has worked great.

    0Reply
  • Emanuele Pani
    Rental Property Investor · Boca Raton, FL · Member since 2014 · 104 posts · 55 votes
    5y

    We have definitely seen a nice grown and we are back to pre-COVID occupancy rates, the hardest month was April but mostly due to the number of cancellations we received. We have seen a clear change in guests behavior mostly when it comes to how far in advance they feel comfortable booking (used to be a couple months and it's now a few weeks to just even a few days before), their expectations as far as cleaning goes and also the length of stay (more and more work-cations so we had added desks to every bedroom as well as upgraded WIFI) . I think moving forward our numbers are going to keep getting better for a combination of reason but leading ones will be the fact that people don't yet feel comfortable with the idea of a hotel (shared spaces, elevators, shared ventilation etc) and the reality that since people are staying for longer you can't beat the comfort of having a full size apartment with kitchen and washer and dryer to a hotel. When it comes to your question about data I would recommend looking into getting a membership to the zip code of city you are interested in at https://www.airdna.co/ and really start getting to know your market and what works in the area, I would focus on playing around with the rentalizer and see how projected revenue can change based on number of beds etc. 

    1Reply
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