According to a recent report from Morgan Stanley, as awareness of security issues rises, Airbnb’s growth slows. The third annual AlphaWise survey saw the researcher drop their prediction of Airbnb growth by over 50 per cent, from 29 per cent to 12 per cent, in the EU/US. However, the data in Australia tells a much more concerning story for property managers and short-term letting.
Independent Airbnb monitoring site, Inside Airbnb, claims there has been an 87 per cent rise in total listings across Australia over the last 12 months.
Of the accommodation offered, almost 70 per cent are entire properties. This provides stark contrast to the philosophy of Airbnb – as a platform allowing empty nesters to make some extra cash off their spare room.
What does this data mean for property managers?
It’s hard to nail down because Airbnb are notoriously tight with their own numbers, but one bad sign is ‘multi-listers’. Multiple listings by one user are up 107 per cent in the past 12 months, and this is a possible sign of investor activity.
Then there are the profits.
Multiple Airbnb property management platforms have popped up, offering homeowners a middleman between them and guests. These platforms suggest they can secure up to three times the rent of traditional rentals.
Data from Nested, a London-based real estate platform, shows that the average property cost in Sydney could be recuperated through 315 months of rental, but it would take just 80 months on Airbnb to make the same amount.
As the downturns noticed by Morgan Stanley show, it isn’t all massive profits and popularity. Airbnb has been heavily criticised by its lack of security measures.
At the end of 2017, four properties in Melbourne rented out via Airbnb were trashed and nearby property was damaged. In a statement released by Airbnb the company said these incidents were ‘rare’, but that didn’t stop police urging people to think twice before using the platform.
Inside Airbnb’s data shows that Sydney alone has 32,830 Airbnb listings, a slight downturn on last year, but still a significant number of properties for the short-term rental market.
As this number rises, the chances of making huge profits on the platform begin to drop, especially in in-demand suburbs where homes which were previously easily rented out are now sitting unoccupied.
Alongside the platforms offering to help manage Airbnb rentals, other platforms have arisen to fight the threat.
BnbGuard is one company promising to help property managers and landlords ensure their properties aren’t being illegally listed elsewhere, by scanning multiple databases with technology they have created. Platforms like this are tailored towards tenants who could be renting out spare rooms illegally, but still add another price to the cost of property management.
There have been calls for Airbnb to release their own data, something which will make it easier to monitor how the platform is growing.
The pressure is heating up as data is released from companies like Inside Airbnb, which recently published The Face of Airbnb, New York City, a report which showed some damning figures of how Airbnb is assisting in the gentrification of New York.
Airbnb responded by claiming this was a ‘flawed study’, but it has highlighted the necessity for the platform to release its own data, which may be the only way we find out how big the threat of Airbnb truly is.