I am seeing a lot of stress and worry turn in to panic, fear, and anger. I thought I would take a moment to share some thoughts and ideas with my fellow hosts to hopefully assuage some of those fears.
What about my income?
First things first... we are not helping ourselves, our community, the AirBnb brand, nor the peer-to-peer rental market by being hard-nosed about refunds. Get yourself in the mindset that during this time, you will offer 100% refunds. I promise that people will not only remember AirBnb, but they will remember you if you go above and beyond. You are in the hospitality business, so act like it!
With your mind in the right place, you can begin to really look at how to minimize the damage. Step two here is to plan for a minimum required income. Look at how much money you need to just barely get by and cover all your expenses. Don't even think about profits. Right now, you're just trying to hang on to your assets.
Now you can finally look at your options:
None of those options work, I'm doomed!
While it may feel like you are out of options, chances are, the worst case scenarios still are not so bad. In many countries, including the United States, mortgage and rent relief is currently available for up to 6 months, maybe even longer. You may have to do a little bit of paper work to qualify, but you should have plenty of time for that with your properties currently sitting vacant. And if even that sounds like too much work, many banks and lenders have already expressed that they will not collect any late fees, report delinquent loans, or foreclose on any outstanding unpaid mortgages.
Use this moment to take a deep breath and exhale that sweet sigh of relief... it's going to be okay!
As business owners, we all knew we were taking a risk. If you didn't, well, welcome to the joys of running a business where lessons are usually learned the hard way! Truly, this is an opportunity for learning and growing and becoming an even better host. If your worst case scenario means losing your property, swallow that hard pill and beat the banks to it. Sell before it is taken from you. Take control of your situation before someone else takes control from you. Then wait and you can start again with all the lessons of how to be even more successful the next time around.
I think I can survive, but what have I learned?
What works best for you to plan for the future? For me, I always try to follow a 6 month rule. Keep a large enough savings to cover all of your financial obligations for up to 6 months. What would happen if you lost every single penny of income? How long could you float on savings? If the answer is less than 2 weeks, then that is a major problem and you may want to consider getting some financial advise on how to manage your budgets.
Let's review some lessons:
In the end, most of you are likely already well aware of these things. Many of you also have much more that you can add. I know that by sharing these thoughts, I am helping potential competition to be more competitive, but I also hope and wish for everyone to succeed in their endeavors. Remember to stay solution-oriented. Don't give in to victimization and don't compare your misfortune to someone else. Think about what it takes to keep moving forward!
Best of luck to all you fellow hosts!
@Michael3477 not sure if u realise all borders are closed, many businesses closed so all ur great ideas will work in a normal situation but not with COVID-19 pandemic. The hope is gone for the next few weeks to come and maybe months. Free movement is OVER for now
I have certainly learnt from this not to put my eggs in one basket. Actually, they weren't in one basket as I had income as a freelance editor, which I have also lost 100% of due to this crisis, but in terms of renting my space, all eggs were in the Airbnb basket.
So, the next few months at least look bleak and although I agree that we should be avoiding social contact (the UK is currently in lock down for at least three weeks), I am also not relishing the idea of living alone in a large house for weeks or maybe months to come. Apart from the fact that I can't afford it, I am sure soon I will start to feel lonely and less safe.
So, I am starting to do now what I should have done before, which is looking at other avenues for advertising my space. I am not expecting to fill it any time soon. In fact, I don't want to fill my three rooms right now, just to take in one local who is working from home. Some people still need short-term housing and I am willing to offer it to someone who will follow the precautions set out by the lock down.
I relied solely on Airbnb because I had almost 100% occupancy year round, and that is with long-term guests. If I would have had no minimum stay and allowed for very last minute bookings, I am pretty confident that would have been 100%.
But the main reason is because Airbnb seemed to offer hosts some protection, i.e. cancellation policies, deposits and the Host Guarantee. One could have predicted that Airbnb would radically change its extenuating circumstances during a major crisis like this. I, for one, could not have predicted that they would at the same time ignore their own policy, e.g. refunding guests for nights they already stayed. How naïve of me!
Anyway, lesson learnt. My eggs are currently being transferred one by one to other baskets.
@Michael3477 I am so impressed with your post! You have been able to sum up everyone's concerns along with giving some great advice and tips.
I plan on using this break to get to all the little details I have wanted to take care of in my rental space. Things like repainting some trim and baseboards, clean every window inside and out along with some caulking where have drafts coming from. I also plan on taking some new pictures of my space and use them to help bring some life back to my listing once we get back up and running.
I hope everyone comes out better and stronger at the end of all of this. Most of us have that Superhost cape on, so now is the time to use it and fight through this!!