Over supply in Eugene, OR

[Jess78]

Well, I've been hosting for 4 years now and each year prices get more and more suppressed due to more abundant supply and some price war-ing. It's gotten to the point that unless it picks up, I'll go back to long term rental of the house. Long term rental prices are up and short term seem to be way down. When I average the gross per month from the last year, we'd pretty much come out even.  More hotel supply and a thousand new hosts in town. I guess it'll either even out as people decide to jump ship... Anyone else notice this in Eugene area? Tips other than make your place even better, hang in there, list on other sites too, etc?

[Mike340]

@Jess78

" Long term rental prices are up and short term seem to be way down "

true for many,many,many cities/areas Jess ....and hosts end up offering more and more...for less and less

Tips? ...Jump on the long term before everyone else does (some of the  thousand new hosts in town) and brings those prices back down again....  

Hang in there ?..yeah..you could do...but it is clearly a race to the bottom in terms of prices and offer.... how low it goes and who wants to hang around through it..... maybe do a year,  long term, and see how the market looks then ...  the best locations and best offers/provision will survive the downturn/over supply

[Pete28]

If you can do long term and make roughly the same then only a crazy person would do Airbnb. I have both a long term and STR, and the STR is a daily annoyance of cleaning, reviews, smoking, garbage, bad parking, guest communication etc etc. Why would you want it ?

I think the best STR is a part of a house (MIL etc) where it is hard to rent separately and you can keep a close eye on it and be around. Your total cost is low, expenses are already those that you have, so risk is low.

An STR should make maybe two or three times stand alone rent, but only up to a point. A neighbour had a house that would rent for $4k / month - doing that alone on Airbnb would be difficult and highly seasonal. He wasted about 6 months before renting it out long term.

[Rebecca181]

@Jess78 I'm over here in Florence, Oregon. One day I decided to look at listings in Eugene, just to see what prices were like. I could not believe my eyes: Gorgeous listings that were priced ridiculously low. I could see that there were many, many listings and an obvious price war going on. So I'm not surprised to see your post. If it were me, and I could get the same amount renting long-term, I would do so. Less headaches, if you screen well and get a good tenant. Then again, you could hang around until the new hosting requirements roll out in July. A lot of hosts may not be able to maintain the 4.7 rating required, and you may have less competition and can charge more as a result. Best of luck, either way!

[Jess78]

Hey everyone! Thanks for the thoughtful replies. June-September is our high season here and I've got bookings through November at this point, but I'll probably be going to a long term rental again after that. Maybe things will pick up and I'll change my mind, but it just hasn't been worth it this year so far. Eugenians are big on the gig economy/real estate rental business and everyone's caught on.Probably why the long term rental market is so tight...

I just listed on another site in addition, one on which rates seem more competitive in the area. It's pretty insane to rent a nice, clean, fully appointed 4 bedroom 2 bath house for what the suggested  rates are (around $78/night average).

[Pete28]

Not sure that would cover the cleaning costs on something that size 😞 ?

One of the delights of long term rental is no need to clean, provide towels, put up with crazy reviews, and the constant risk of damage without any real deposit.

[Matthew285]

@Jess78 @Rebecca181 I have always been concerned that as Airbnb became more mainstream that it would attract an oversupply of hosts, which would cause the very problem you have mentioned.

I know Airbnb is working mightily to get more people overall to use the platform (to get more business for the hosts)... but then they invite the hotels to add listings.

It is crazy.

Is the only solution having hosts drop out as it becomes unprofitable for them?

[Pete28]

I think regulation will solve a lot of those problems. Seattle is limiting to primary residence + one property next year and requiring a license.

[Matthew285]

@Pete28 that sounds like it will help.

Do they say much about how the city will enforce the regulations?

Here in San Francisco there were clear regulations for many years, but those regulations were routinely ignored. It was not until just this January that enforcement actually caused a reduction in the number of listings.

[Pete28]

Each host needs a license, which they need to append to their listinga, max of 2. One must be primary residence.

Clearly the easiest way around this is to have a proxy hold additional licenses - not sure how the city can prevent that - they could check property tax records for owner of primary residence etc and compare with who is holding the license. Not hard to do, but don't know if they are capable.

Rules against renting boats, trailer, tents, houseboats etc are easier to enforce.

[Sarah977]

@Jess78    I think that long term, on a whole house, is a better way to go.  A lot less work, easier to vet tenants than airbnb guests, you can actually take a real security deposit, and really, it's getting hard for decent hard-working people and families to find affordable long-term housing in cities where they live and work, when so many people are renting them out short-term. So there are all these people who can't afford to buy a home, and now they can't even find a place to live? I don't like to see things go in that direction myself.

[Karen268]

I do home share.  If I had to turn to long term rental I would not do rental at all.  There is nothing but trouble for landlords in long term rental situations with renters.  The process of getting rid of bad renters in debilitating and frustrating.  Wwhile you are going through the process bad renters can destroy your property.