My goodness, there are a lot of new ABBs now!

Laura2592
Level 10
Frederick, MD

My goodness, there are a lot of new ABBs now!

I was chatting with a brand new host who found me on Instagram the other day. She has a really cute listing and was asking all kinds of questions. Out of idle curiosity I did a search on the small city she is in (we used to own a property very near to hers which was a long term rental, not through ABB.) I was shocked to see SO many listings including some which are old neighbors of our former rental. It has exploded. 

 

Three years ago when we started, we considered turning our rental into an ABB. There were literally 5 listings and only one of the hosts was always booked. So we figured "too much work" and found a new tenant. When we were married in that same small city, we had a tough time finding enough places for relatives to stay nearby. Now there is an abundance. There are also some truly "interesting" guests, a few of whom seem to be locals rotating through these various listings without a fixed address, leaving scathing and often bizarre reviews for hosts and getting them as well (but somehow still able to book on the platform.)

 

So I dug in deeper and yes, the city has proposed some pretty strict regulations which have not yet been ratified. Its just a matter of time. 

 

Our own listing is not in this city but its definitely one of the destinations our guests like to visit. I have not seen the same trend in rural spaces in our area, but suspect if people think it will make money, they will start to snap up properties.

 

Are you seeing an increase in ABB in your area in the last year or so?

10 Replies 10
Loni56
Level 10
Santa Catarina, Brazil

@Laura2592 bom dia aqui na .minha área este ano 2020/21

aomentou muito os imóveis

pelo airbnb não As reservas ,mais os anúncios sim!!

Loni Brasil SC.

@Loni56 Sim, há tantos novos este ano! Mas não há muitas boas críticas na minha área.

Pat271
Level 10
Greenville, SC

In Maui, we have fewer, actually. The pandemic really nailed us because of the quarantine requirements, and many left the business or converted to long-term rentals. Also, the government has gradually imposed more and more restrictions on the number of new permits that can be acquired for STRs.

@Pat271 yes my SIL and BIL were just in Maui for a wedding. They said it was remarkably quiet, I am sure due to all the COVID restrictions. 

M199
Level 10
South Bruce Peninsula, Canada

@Laura2592 

 

Absolutely, in my area, the Bruce Peninsula, Ontario, Canada, we are seeing a large increase.  One of my guests needed to stay in the area to do the final walk through on a cottage they bought.  Since the visit, they listed and already have several bookings.  And I have another local neighbor who was renting privately and now wants to "go Airbnb".  Future Superhost training set to start soon.  Lol.

Branka-and-Silvia0
Level 10
Zagreb, Croatia

when I bought my Airbnb apartment I was the only one in the building. Now there are 2 more.

I know most of my host neighbors in nearby buildings and we help each other with bookings. There is at least 1 Airbnb in every building in my street.  And in other streets all over the city center. (I know bc we have to have a license and a universal STR sign outside) Competition is very strong and all apartments and rooms are newly renovated and very modern. It is not easy to get booked. We offer free parking and that's a big plus.

 

Some listings are closed the last year bc the earthquakes damaged a lot of buildings but there are new listings as well. So yes, we have Airbnb explosion in Croatia for more than 6 years already

Brian2036
Level 10
Arkansas, United States

@Laura2592 

 

I was surprised to find that there are 50 within 30 miles of us. This is a very sparsely populated area although there are tourist attractions no too far away.

 

 I wonder if part of Airbnb’s apparent disdain for hosts has something to do with supply/demand.

M199
Level 10
South Bruce Peninsula, Canada

Just tonight saw another "New Listing" , 2 km away.

 

Competition and free market.  Our area is so in demand that for sale properties are selling at double or triple market value just to be turned into Airbnb.  Ridiculous real estate markets and mentality.

@M199 yes I think there is a real vibe that "you make a lot of money" but many hosts do not seem to apply basic math. 

 

I had a long conversation with someone who was in a bidding war to buy a property for an ABB. They paid over 20K above asking in an area where that is not very common, even in this market. They will have a mortgage. They will need cleaning and general maintenance of the space. They will need to buy furniture and pay bills. The average listing in their area is not close to what they will need to price per night to break even.

 

I felt like I had really popped a balloon when we crunched numbers. They basically needed to target a property about 100K or less than the one they fell in love with in order to come close to their desired bottom line. All of this would be fine if they were planning on just offsetting costs until they could occupy the home themselves. But they were all jazzed by tv shows saying "this person will make an extra 100K a year by renting this short term property if ONLY she can decorate it well!" As an investment, I suspect many of these new ABBs will not perform the way people fantasize about. 

 

 

Brian2036
Level 10
Arkansas, United States

@Laura2592 @M199

 

As with the irrational exuberance in the securities market, this kind of thing gives me a stomachache.

 

If it were only the gamblers who lost their shirts it wouldn’t bother me at all, but somehow these fools usually manage to spread their misery to the rest of us as well.

 

I’m really glad that I don’t depend on the income from our property. I would have to do things I really don’t want to do if I had to make it break even.