As the travel and hospitality industry is one of the biggest sectors hurt by COVID-19, it comes as no surprise to learn that Airbnb has suspended all of its marketing in an attempt to save $800 million this year.
Airbnb’s founders will also not take a salary for the next six months, and top executives will take a 50 percent pay cut, according to Reuters. The company has paused hiring as well, with the exception of a few key roles. (Read the full article here).
Airbnb announced plans to go public last September, reporting over $1 billion in revenue for Q2 2019. Airbnb’s losses nearly doubled in Q4 last year, before the pandemic became a global issue, according to Bloomberg.
Image: Yahoo Finance
On the afternoon of March 30th, the CEO of Airbnb, Brian Chesky, conducted a live stream for the hosting community. Here is a summary of what Brian said:
- Travel is at an all-time low
- Recognition and apology that Airbnb has drifted from the host-focus it was created on
- COVID-19 cancellation policy was set for the sake of public health. He apologizes for not consulting hosts (violation of partnership)
Actions going forward:
- Extenuating circumstance policy – established a $250 million fund to pay hosts 25% of canceled booking. Retroactive to March 14. Cancellations before March 14 will be based on host cancellation policy
- Establishment of $5000 grants for Superhosts and Experience Leaders up to a total of $10 million coming early April
- Previous guests will be able to send messages and donations directly to hosts. Expected effective date: early April
- For USA hosts only: COVID-19 stimulus bill allows Airbnb hosts to be eligible for SBA loans and grants, as well as unemployment benefits
You can view the message and read the details here.
The CARES Act passed the Senate and House last week providing relief to businesses across the U.S. This bill has provisions specifically targeting affected businesses in the tourism industry. These provisions will be available through grants at the state and local level. Advocating on behalf of the Short-Term Rental Industry is extremely important during this economic crisis.
This legislation provides direct cash payments of as much as $1,200 for individual taxpayers, and $500 per child, phased out when incomes exceed $75,000 for individuals and $150,000 for couples filing jointly. This also dramatically expands unemployment insurance benefits and provides an additional $600 per week for those receiving unemployment benefits. The bill provides $349 billion dollars in much-needed, low-interest, small business loans that could be partially forgiven to help businesses maintain payroll and avoid laying off workers. It also directs billions of dollars toward hospitals and other health care providers on the frontlines of this pandemic, in part to help them purchase additional life-saving protective equipment.
VRMA has provided a high-level overview and breakdown of this bill, which you can read here.
3 Ways to Make Your Voice Heard and show how short-term rentals help support our families, jobs, local neighborhood businesses, and the City’s growth.
#1) Attend and speak at the next STRAC meeting:
There are opportunities for public comment at these meetings and it is important for your voice to be heard.
Upcoming STRAC (Short-Term Rental Advisory Committee) Meetings:
- Tuesday, April 14
- Tuesday, June 9
- Tuesday, August 11
- Tuesday, October 13
- Tuesday, December 8
#2) Speak at City Council Meetings:
Denver City Council meetings take place twice a month on the first and third Monday. Each speaker gets 3 minutes to speak. All details can be found here. If you are interested in learning more and getting involved please email email@example.com.
#3) Schedule Coffee with your City Council Member:
Email firstname.lastname@example.org and we will help you schedule a 1:1 appointment with your city council member. They are happy to meet with you as this is part of their responsibility as representatives of us all.
A Story of Economic Success
Owner: Kayla Darling
Year opened: 2017
Number of employees: 12
Denver is home to some incredible vendors who work hard to ensure that home-sharing can be an excellent experience for hosts, guests and the community at large. One of the key players in your home-sharing success is the cleaning company you choose to hire. Joyful Soul Cleaning mainly employs single mothers. Their team is skillfully trained to pay attention to the unique details of your property, send you important reports as well as make your home beautifully guest-ready. Joyful Soul Cleaning’s hard work is reflected in the 5-star reviews they consistently help to generate for their customers’ listings.
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.
A Step in the Right Direction
Since conception in 2008, Airbnb properties have taken on many shapes and sizes, from renting an air mattress on a living room floor to full homes that can sleep large groups. More recently the talk of the town has been ‘party houses’, which have unfortunately been the scene of open-invite parties and gun violence.
In response to these recent events, including deadly shootings in other cities, Airbnb announced at the end of last year that they would be banning party houses including parties in condos and apartments. Airbnb has created a Neighborhood Support site with contact info to report parties or disturbances: https://www.airbnb.com/neighbors. Additionally, Airbnb says it’s opening a dedicated hotline for mayors and city officials. We are eager to see these steps taken in order to protect not only our guests and hosting community, but our city at large.
On December 12th, Westword published an article sharing the news that a Denver judge has exonerated Aaron Elinoff by dismissing the felony charges claiming that he was trying to cheat the system with his short-term rental license.
While some City Representatives applaud the use of the affidavit as a means of enforcement, we can see the potential havoc it can cause in an individual’s life as well. If the city’s goal is to have fewer short-term rentals, then the affidavit is successfully accomplishing this. On the other hand, if the city is looking for harmony and supports this community, then a focus on solutions to address the problems would seem like a more diplomatic approach.
We are happy to see Elinoff’s name be cleared and so he can get back to life with his family and focus on work. It makes us wonder how many rule-abiding hosts forfeited their license out of fear of having their reputation damaged and mugshot blasted globally?
Photo: Aaron Elinoff had been fighting against a felony charge related to his short term rental application / Courtesy of Aaron Elinoff
The December 10th STRAC meeting reflected a significantly more positive and collaborative tone towards home-sharing. The Good Neighbor Summit made it into the news headline summary slide, and several members of STRAC & Denver City acknowledged that Denver has a highly engaged and solution-oriented host community. Councilwoman Amanda Sawyer (Dist. 5) was there alongside Councilwoman Candi Cdebaca (Dist. 9) who sat in for Councilman Kevin Flynn.
The proposed regulation to limit short-term rentals to 183 days per year was taken off the table, but more proposals to further clarify primary residence are still coming. The session ended with several well delivered public comments that even further portrayed the positive and collaborative culture we are building here in Denver.
Did you want to share something during Public Comment or in response to something that was presented? If so you can submit your comments here: STR@denvergov.org and CC email@example.com so we can track hosts’ comments. Use “STRAC Public Comment” as the email subject line.
Join us at the next STRAC meeting at 4PM on Tuesday, February 11th at Webb Building at 201 W Colfax Ave. Rooms 4.F.6 and 4.G
Denver Host Linen Drive
Mile High Hosts are happy to announce our first Home-Sharing Linen Drive! Home-sharing often results in quality sheets and towels that aren’t “guest perfect”, but still have a lot of life left in them. This holiday season, our goal is to collect as many usable sheets, pillowcases, blankets, duvet covers, towels and washcloths as possible to package and donate to local families and shelters (for both people and animals!). We ask that you label sheets with their sizes to aid our “elf specialists” in their task of sorting and packaging what will be mountains of linens for families.
We will be accepting donations from Tuesday, December 17th to Thursday, December 19th between the hours of 9AM-5PM daily at the following locations:
- 2612 E 13th Avenue (a residential home) – drop on front porch – feel free to send Gretchen a text when you make your linen drop
- Highline Management at 1815 N Federal Blvd
- Platte Park 1620 S Emerson St Denver 80210 (if you drop your linens & towels off here, please place items in the box on the covered porch area on the right side of the house down the wooden walkway)
If you can’t drop off between those hours, you can coordinate a different time or possible pickup with Gretchen or Jim of Denver Superhosts by texting (720) 235-8123 – contact that number or email info@DenverSuperHosts.com with “Linen Drive” in the subject line with any questions you may have.
Mile High Hosts thank you in advance for your generosity!