Studies Show STRs Modestly Impact Housing Affordability
One of the hottest topics of debate is that short-term rentals (STRs) are to blame for increased pricing and a lack of affordable housing. Some cities, including Denver, claim that the reason they chose the primary residence requirement was to protect housing affordability. However, EXL’s own study contradicts the common misconceptions that STRs are to blame for the lack of affordable housing.
In a Wall Street Journal article published in November of 2019, it was reported that STRs have not significantly contributed to the rise in American housing costs, according to a nationwide study by Oxford Economics. “In the first such study to cover every U.S. county where data was available, the report found that over a four-year period only 0.2 percentage point of the 4.3% rise in inflation-adjusted rent could be attributed to the effects of short-term rentals. For home sales, the increase amounts to less than $9 on the average monthly mortgage payment.”
In April of 2019, Excise & Licenses hired Denver Economic Development and Opportunity to research the impact of STRs on the housing marketing. The findings showed that STRs make up 1% of the housing supply and therefore the report concluded that STR’s do not impact housing prices nor rents.
It’s time to put the affordable housing argument to rest. It’s time to find a way to allow citizens to practice their rights while also ensuring outside investors can’t just swoop up the block.
It takes practice to be a successful short-term host, from creating eye-catching property listings and making the most of your space, to interacting with guests from booking to check-out. Take a look at our list below for some common mistakes made by hosts, especially those just starting out in the short-term rental world. With some experience, you’ll be on your way to stellar host status in no time.
#1. Having limited ability.
Many first-time hosts devote only part of the day, like before leaving for work, to addressing guests’ issues, questions, or requests. But a maintenance problem or other issue can happen anytime, day or night, and delays in responding to these requests (especially in cases of emergency, like a pipe bursting or roof leaking) can lead to a bad review and potentially a dangerous situation. Guest Experience Coordinators at ERG are available 24/7 to help address anything that comes up during your guests’ stay. Whether a guest reaches out about needing fresh towels or something more serious, we respond quickly to get things back on track.
#2. Not optimizing your space.
You don’t need a lot of space, but you should efficiently use the space that you do have. Make use of spare rooms and empty areas by giving them a purpose: install drawers in the space under the stairs for more storage, or turn the corner of the living room into a cozy reading nook. Have a large backyard that goes mostly unused? Get some benches and turn part of it into a fire pit area. Small touches like these will make your listing stand out from the rest, which will get you more views, bookings, and positive reviews.
#3. Representing your property incorrectly.
Your listing is the key to attracting guests, so it’s important that you optimize it to include relevant descriptions about your home and high-quality photographs that feature its best qualities. Try to showcase the details that make your home unique, like a deck with skyline views or a game room in the basement that’s perfect for entertaining. One of the benefits of a partnership with ERG is a fully optimized property listing. Our professional photographers, interior designers, and writers are dedicated to presenting your home at its best.
#4. Not keeping up to date with local regulations.
This common oversight can cost you in the long run. Cities change their regulations for short-term rentals all the time, and it’s important to stay updated—or risk a steep fine and possibly your ability to rent in the future. Your city should have a short-term rental page on its government website with all of the info you need to apply for permits and learn about guest allowances, taxes, and more. Pay close attention to the information your city requires you to post on your listing, like your Business File Number (BFN), to remain a valid host.
#5. Underpricing or overpricing your property.
Most hosts on short-term rental platforms like Airbnb and VRBO are incorrectly setting their nightly prices, and therefore sacrificing number of bookings, monthly revenue, or both. It can be tricky to correctly price your property while taking into account important variables like local events, hotel occupancies, and travel trends. ERG’s analytical pricing matrix considers these and many other variables to set rates that get you more bookings over multiple platforms, including our own exclusive platforms. We use a flexible pricing approach—not a static one—so the prices we set change based on day of the week, seasonality, weather conditions, and more.
#6. Not understanding the ups and downs of short-term rentals.
Every investment property makes more money during certain times of the year and less during others. Maybe there’s a summer festival in your town that attracts a lot of travelers, and the rest of the year is relatively quiet. Or if your home is in a region that sees sunny skies only a few months of the year, you’re likely to have a surge of guests at that time. It’s important to recognize that these fluctuations are normal and not get discouraged. Focus on ways to attract guests in the slower months, like a lesser-known event nearby or renovation projects that will make your home stand out year-round.
#7. Cleaning and maintenance slip-ups.
Two of the main reasons for negative reviews are oversights in the cleanliness of the property and delay or failure to fix something that’s broken. It’s crucial that you have cleaning and maintenance experts who you can trust to prepare your property before every booking. ERG’s professional cleaning company keeps your property looking immaculate after every check-out. If any repairs are needed, our maintenance team resolves the issue quickly and efficiently. We make sure that everything is in pristine condition when your guests arrive—every single time.
A partnership with Effortless Rental Group means 24/7 support by our team of short term rental management experts who are dedicated to your success. We’d love to help you navigate these and other common experiences of first-time hosts.
Helping those in need is nothing new for Airbnb. Since 2012, the company has connected thousands of people displaced by natural disasters and other emergency events with nearby hosts willing to donate their spare bedrooms. In 2015, Airbnb added a donation tool to their website for refugee assistance efforts through a partnership with The United Nations High Commissioner for Refugees (UNHCR). Now, in response to the recent onslaught of hurricanes that have destroyed many homes and damaged countless others, Airbnb is once again stepping up to offer assistance in a crucial way: free shelter for those with nowhere else to go.
Through its Open Homes program, Airbnb creates a platform for hosts in disaster areas to list their homes for free. Then either partner agencies or verified account holders contact the hosts to set up bookings, which can last from one night to over a month, depending on the host’s preferences and availability. The process happens quickly, and people who have become homeless overnight soon have a secure and welcoming place to rest and recover.
“At the heart of our mission is the idea that people are fundamentally good and every community is a place where you can belong,” writes Airbnb CEO and Co-founder Brian Chesky on the Airbnb website.
Over 700 hosts signed up to help Hurricane Harvey evacuees and relief workers, and another 200+ have opened their homes in the US and the Caribbean to those affected by Hurricanes Irma and Maria, with numbers continuing to rise.
Even with all they’ve already accomplished, Airbnb founders don’t plan to stop anytime soon. In February, the company announced their goal to find free housing for 100,000 displaced people over the next five years. They will also donate $4 million over the next four years to the International Rescue Committee (IRC), to provide resources directly to refugees, evacuees, and others who need emergency assistance.
Founders are optimistic about the future generosity of hosts to help achieve these goals. Co-founder Joe Gebbia writes in an Airbnb blog post titled Opening More Homes to People in Need, “…Every single time we’ve asked our community to open their doors and hearts to help others, they have more than exceeded our expectations: they have humbled us with the immensity of their kindness.”
For more information and to volunteer your home, visit the Open Homes page here.
For a small-town feel in the big city, look no further than Edgewater. A short drive from downtown and blocks from Sloan’s Lake, Edgewater is a lovely place to spend a sunny afternoon. This diverse neighborhood offers a stretch of shops and restaurants, referred to as “Main Street,” a picturesque place for a stroll after spending the day at the lake. Local favorites include Providence Tavern (5280 W 25th Ave), Happy Leaf Kombucha (5700 W 25th Ave), and Coda Coffee Company (5224 W 25th Ave). During the summer months, Denverites looking to escape the city can be seen paddle boarding, lounging on the beach area, or bird watching on the edge of the lake. No swimming is permitted in Sloan’s Lake, but boating and some water sports are allowed with a permit. There are also basketball and tennis courts inside the park. Don’t miss the annual Colorado Dragon Boat Festival, a two-day celebration of Asian Pacific culture, from July 29-30. With not only a race between 50 colorful boats to be the first to cross the lake, but also live performances, Taste of Asia food vendors, and an Asian Marketplace featuring authentic gifts and crafts, it’s clear why this festival draws over 125,000 people.
Welcome to Denver Skyline Lofts, the ultimate in Denver luxury rental. Each deluxe loft spans an entire spacious floor of the building and features open floor plans, private balconies with 360-degree views of the city, and the highest quality furnishings. Stay in the optimal downtown location—just blocks from 16th Street Mall, LoDo, and the hottest dining and nightlife spots. Modern and upscale, these top-line luxury lofts offer the best of Denver.
Denver Skyline Lofts feature one of the best rooftop patios in Denver. The private space has incredible panoramic views of downtown and a large hot tub that looks out over the city. Make a drink at the granite-top bar and relax in the fireplace area with 2 TVs.
The complete entertainment center on the first floor of the building includes 2 flat-screen TVs in the main room and a film area with a large projector screen and leather seating. The center also offers a granite-top bar, game machines, shuffleboard and pool tables, and an indoor driving range.
This bustling area is full of trendy galleries, clubs, coffeehouses, and the famous Denver Art Museum, which has exhibits that rotate on a weekly basis. Indulge in fine dining and get a taste of Denver at 5-star restaurants nearby such as Palace Arms and The Capital Grille.
Learn more about Denver Skyline Lofts at www.denverskylinelofts.com
Just to the northwest of downtown lies the Highlands area, bustling with trendy bars, coffee shops, art galleries, and nightlife. There’s something for everyone around here—stop by a Saturday farmer’s market to get the freshest produce, or hop on a bike and explore the area by wheels. The neighborhood is divided into three sub-areas: Highlands Square, Lower Highlands (LoHi), and Tennyson Street. But wherever you find yourself in the Highlands, you’re sure to stumble across a hip new eatery or an awesome happy hour. Old meets new in historic neighborhoods dotted with classic Victorian homes, with many areas experiencing an influx of visitors and new residents. Downtown is just a quick cab or bike ride away, but you’ll find plenty of things to keep you busy in the Highlands. Don’t miss the Tennyson Street First Friday Art Walk, the first Friday of every month from 6–10PM, where artists showcase their work at independent galleries and local restaurants offer great specials. And be sure to check out one of the well-loved Mexican restaurants like El Camino Community Tavern (3628 W 32nd Ave) or Taqueria La Familia (2642 W 32nd Ave) for genuine food that pays tribute to the Highlands’ Hispanic heritage.
What it will be is now coming into focus.
Construction is still more than a year away, but the development team this week will start meeting with prospective tenants and stakeholders to share its globally minded vision and increasingly concrete plans for the project.
“This is going to be the most diverse ecosystem in Denver but with one singular focus and that focus is global connectivity,” Gerwitz said. “It’s going to be very global, very diverse but uniquely Denver, too.”
The day-night campus could also house 30,000 square feet of retail and restaurants with a global focus, on-site parking and a public plaza that could host international movie nights, festivals and other events.
Construction could begin in the fourth quarter of 2017, with the first 1.5 acres of the campus, at 38th and Walnuts streets near the new train station, opening in the fourth quarter of 2019. Several more acres are available for future expansion. Cushman & Wakefield and Newmark Grubb Knight Frank are handling the leasing.
“We want our best and most talented global-minded businesses and entrepreneurs,” said developer Sean Campbell, whose past work includes Industry at 3001 Brighton Blvd. “The idea is from top to bottom, you’ll get a global flair from small and emerging born-global companies to multi-nationals and really strong Colorado-based companies that are doing or growing their global footprint.”
WTC Denver moved out of its longtime downtown Denver home in 2015 in part because of limited space to host events and to bring in other trade-focused groups. Earlier this year, the group announced it had chosen the red-hot River North Art District for its new campus, joining forces with Campbell and Andrew Feinstein, a co-managing partner of the EXDO Event Center and an owner of some of the land proposed for the campus development.
Campbell said he will begin meeting in earnest with interested capital partners in the coming weeks and months to put the financing together.
The new campus will allow WTC Denver to expand from about 100 events a year to daily programming in conjunction with its partners in residence, Gerwitz said.
“If you have a global mindset and you’re in Denver, this is the place you’ll want to be,” she said. “It’s very much a global community, a hub, a magnet for global business and global business engagement. It will be a welcome center for international visitors where they can get off the plane, jump on the train and stop here, one stop before Union Station, and check in with our concierge desk, get some assistance and connections to the local business community, attend their conference here and stay on site at our business-friendly hotel.”
Campbell said they spent a lot of time thinking not only about what kind of offices people will want in 2019 but also in 2030 and 2040. OZ Architecture is leading the design process for the campus.
“If we do our jobs well, this will be essentially turned back over to our global business community as a resource, as a beacon, as a platform for everybody to succeed,” Campbell said.
Even as technology advances, having that physical space where “collisions in the hallway” can happen remains important in the world of global business, Gerwitz said.
“People think I can connect on the internet and find partners, but to be honest, global business is so different than doing business domestically. It’s all about building relationships and it’s all about knowing those connections,” Gerwitz said. “You might bump into someone who says, ‘Oh yeah, I’ve done business in Indonesia. I’ve got a distributor there already. Why don’t you contact them?’ That’s typically how international business works.”
“Denver’s new World Trade Center campus in RiNo could cost $175 million to $200 million — for just the first phase” Denver Post, 19 Sept. 2016, http://www.denverpost.com/2016/09/19/world-trade-center-denver-new-rino-campus/