ALL NEWS

Airbnb hosts are planning to sell off their properties because of the pandemic

May 25, 2020, 9:45 AM

airbnb hosts...

The lakes in Finland are a great place to spend the summer holidays with the whole family

(CNN) — Amy Offield always dreamed of running a vacation rental in Galveston, Texas. Five years ago, she and her husband Chris got their wish and bought a house minutes away from the beach. They immediately began restoring the property, which she named the “Blue Skies Beach Bungalow,” adding vintage items as well as retro and bright-colored decor.

But as coronavirus spread across the United States in March, Offield, who has been a full-time Airbnb host for nearly two years, started seeing a wave of cancellations. When Galveston temporarily shut down short-term rentals as part of its stay-at-home order.

Offield switched her Airbnb to a 30-day stay, the minimum required to be considered a long-term listing. She didn’t get a single reservation, and her beach bungalow has stood empty for two months.

Finally, after the long dry spell, her husband losing his software sales job and the continued burden of mortgage payments on the home, Offield made the difficult decision to sell the beach bungalow and shut down her Airbnb business.

“It’s been kind of an emotional roller coaster,” Offield told CNN Business. “We’ve lost pretty much all of our income in the last three months.”

With global travel screeching to a halt during the pandemic, a number of Airbnb hosts are planning to sell their properties — at an uncertain moment for the broader real estate market — or get rid of some of their rentals as well as the furniture they bought to deck out their homes.

These desperate moves come as hosts face the possibility of losing thousands of dollars a month in canceled bookings while bills, maintenance costs and mortgage payments pile up. The sudden and painful whiplash for hosts highlights both the broader financial fallout from the pandemic and the potential risks of betting one’s livelihood on the staying power of newer tech platforms.

“We have been working to support our community through multiple efforts, including committing $250 million to help support hosts who were affected by COVID-19-related guest cancellations and $17 million to our Super Host Relief Fund,” an Airbnb spokesperson said in a statement, adding that it’s launched new cleaning protocols for hosts. “Our internal data points to guests’ desire to travel and we are preparing to help hosts welcome them as soon as possible.”

As the pandemic has stretched on, Airbnb’s business model has been thrown into question. After reportedly planning to make its splashy Wall Street debut this year, the company instead had to lay off about 25% of its workforce. At the same time, it has struggled to appease the hosts who are the backbone of its service. Airbnb announced in late March it would pay hosts 25% of what they would typically get back through their individual cancellation policies, but some hosts told CNN Business the policy didn’t go far enough to help, or that they received smaller payments than expected.

The financial fallout from the pandemic could lead to an Airbnb exodus for hosts like Jake Wolf, who has been on the platform for more than five years and shut down his only listing in March. “I’m leaning toward absolutely not,” Wolf said, when asked about returning to the platform in the future. For others, it’s leading to painful choices about which Airbnb properties to abandon and which to save.

Christina Zima, an Airbnb host for nine years, has managed 25 homes full-time primarily in the San Francisco Bay Area, only one of which she owns herself. So far, she has shut down two of those listings during the coronavirus crisis, one of which was pre-planned. Zima said some of the owners she works with are considering winding down more properties, or are looking for long-term tenants, further throwing her business into uncertainty.

“I’m scrambling trying to figure out what I’m going to do, and what’s going to happen in the future,” Zima said. “I’m not making money. With the Airbnb business, I am just trying to minimize my losses. Only one of the houses is meeting its expenses, meaning my rent and utilities.”

Six of the properties Zima rents from the owners for a fixed cost, ranging from $2,800 to $5,600 per month, and then subleases them on Airbnb as vacation rentals, in a practice known as arbitrage. The rest are partnerships with owners, where she takes a cut in exchange for managing the property and acting as a liaison with guests. She takes a higher rate for furnishing the home, and providing linens and other housewares.

With some of her Airbnbs closing down, she’s also been forced to find ways to quickly liquidate her furnishings. Zima has listed items on Facebook Marketplace and set up a pop-up tent outside of her house where people can pick up their purchases. Zima listed so many things on Facebook Marketplace in a single day that she said she was temporarily blocked from posting for a day. Offield has also started selling the various vintage items she has stored under the house in Galveston, which is raised, on Facebook Marketplace.

But some hosts who feel the need to sell are waiting just a little bit longer. Cindy Cabrales and her husband decided to sell one of their three Airbnbs — in Boulder, Colorado — but they’re holding out for now because they have one more booking in July that so far hasn’t canceled.

“The margins are so low, it doesn’t make sense to keep it,” Cabrales said. “The pandemic just pushes it over the edge.”

The-CNN-Wire
™ & © 2020 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

We want to hear from you.

Have a story idea or tip? Send it to the KSL NewsRadio team here.

All News

A photo taken on the Saratoga Springs shore of Utah Lake on August 21, 2021. State lawmakers are co...

Tammy Kikuchi

A bill could improve Utah Lake and get more water into Great Salt Lake

State lawmakers say the goal of SB270 is to improve Utah Lake and direct more water into Great Salt Lake.

2 hours ago

Generic image of crime scene tape. A man and a woman were shot in a home in Naples, forcing the nea...

Michael Houck

Shooting near Naples Elementary School forces lockdown, two victims hospitalized

A man and a woman were shot in a home in Naples, forcing the nearby Naples Elementary School to lockdown Wednesday afternoon.

3 hours ago

Students walk to their buses after school at Rose Springs Elementary in Erda, Tooele County, on Thu...

Jessica Lowell & Devin Oldroyd

Application process for the Utah Fits All Scholarship now open

The application for the Utah Fits All Scholarship is now open. The scholarship will allow families to apply for up to $8,000 of state funds.

3 hours ago

texas wildfires...

Associated Press

Wildfire grows into one of largest in Texas history as flames menace multiple small towns

Known as the Smokehouse Creek Fire, the largest blaze expanded to more than 1,300 square miles and jumped into parts of neighboring Oklahoma.

5 hours ago

Ruby Franke stands with her attorney, Lamar Winward, at her sentencing on Tuesday. Her brother and ...

Jessica Lowell

Ruby Franke and Jodi Hildebrandt transferred to Utah State Correctional Facility

The two women will each spend one to 15 years at the facility for child abuse.

6 hours ago

FILE: Jerry Monson helps his grandson Logan Webb with his orange while in camp above the Strawberry...

Alexandrea Bonilla

Bill would reduce amount of orange Utah hunters must wear

A bill would reduce the amount of orange required by hunters.

6 hours ago

Sponsored Articles

overhead view of a few aisles in a department store...

Big Deal Outlet

There is a Big Deal coming to Midvale: Local discount chain opens 8th store

If you love the thrill of finding good deals, check out the grand opening of Big Deal Outlet in Midvale from February 29 - March 2.

Mother and cute toddler child in a little fancy wooden cottage, reading a book, drinking tea and en...

Visit Bear Lake

How to find the best winter lodging in Bear Lake, Utah

Winter lodging in Bear Lake can be more limited than in the summer, but with some careful planning you can easily book your next winter trip.

Happy family in winter clothing at the ski resort, winter time, watching at mountains in front of t...

Visit Bear Lake

Ski more for less: Affordable ski resorts near Bear Lake, Utah

Plan your perfect ski getaway in Bear Lake this winter, with pristine slopes, affordable tickets, and breathtaking scenery.

front of the Butch Cassidy museum with a man in a cowboy hat standing in the doorway...

Bear Lake Convention and Visitors Bureau

Looking Back: The History of Bear Lake

The history of Bear Lake is full of fascinating stories. At over 250,000 years old, the lake has seen generations of people visit its shores.

silhouette of a family looking over a lake with a bird in the top corner flying...

Bear Lake Convention and Visitors Bureau

8 Fun Activities To Do in Bear Lake Without Getting in the Water

Bear Lake offers plenty of activities for the whole family to enjoy without having to get in the water. Catch 8 of our favorite activities.

Wellsville Mountains in the spring with a pond in the foreground...

Wasatch Property Management

Advantages of Renting Over Owning a Home

Renting allows you to enjoy luxury amenities and low maintenance without the long-term commitment and responsibilities of owning a home.

Airbnb hosts are planning to sell off their properties because of the pandemic