The effect of Airbnb on the rental market
Airbnb has made waves in the rental industry, allowing a larger number of people to rent out their properties through an easy-to-use online platform. While the platform has become hugely popular, property experts don’t believe it is strong enough to take over the entire rental market.
After its launch in 2008, Airbnb quickly grew into the short-term letting giant that it continues to be today. It grew hugely in favour with renters both local and foreign, transforming it into a widely used platform. Perfect for those looking to make some extra cash by renting out their property, or for those looking for a property to stay in while on holiday, the platform championed short-term letting.
While the platform remains extremely popular, property experts don’t expect it to take over the rental industry entirely in the long-term, as there are certain pain points that make it unsuitable for all who want to offer short-term renting. According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, “the hype has since died down as many are coming to realise the frustrations of short-term tenants,” Goslett explains.
Those who have rented their property via Airbnb have experienced how much of a commitment it is if they don’t employ a manager to look after their guests for them. From keeping your prices up-to-date, checking guests in and out, regularly cleaning and restocking the property after guests leave, and responding to interested guests, to dealing with questions and complaints, maintaining the property and and informing neighbours of your intention to rent the property, short-term rentals can be a busy and full-time effort.
Alongside the time-consuming activities related to running a short-term rental property, Airbnb’s enormous popularity has driven an oversupply of properties available to rent, ultimately causing an oversupply of properties available and a decrease in rental returns. The platform also relies heavily on seasonality, meaning that income can be irregular if your property is popular during the summer months, but not as popular during the winter months. Lastly, location is important. Like any property open to holiday makers, Airbnb properties will have a higher demand if situated within Johannesburg, for example, compared to being situated in Randfontein.
