U.S. survey highlights Covid-19 impact on the short-term rental industry

US: In May, US-based advocacy organisation Rent Responsibly, the Vacation Rental Management Association [VRMA] and AirDNA released the Covid-19 Impact Report. In this feature, David Krauss, founder and CEO of Rent Responsibly, highlights the results of data collected from a survey of more than 1,400 hosts, owners and managers across the country in the short-term rental industry.

The survey uncovered data that showed the pandemic’s dramatic impact on employment, economic hardship, and the massive pivot to medium-term and crisis-related housing for essential workers, displaced travellers and students, and renters seeking to socially distance to protect those at risk.

Among the report’s takeaways is the recognition that the short-term rental community is primarily made up of individual proprietors and small businesses. Of respondents who own a short-term rental, 29 per cent rent their primary residence, and 89 per cent own five or fewer. It is easy to forget that for every Vacasa property acquisition or Silver Lake investment headline, there are thousands of mom-and-pops providing hospitality without deep reserves to weather storms like this pandemic.

Of the owners surveyed, 88 per cent responded that they were either somewhat dependent or very dependent on their short-term rental revenue. Couple that with the 85 per cent of the short-term rental managers reporting that they had reduced staffing, reduced hours, or cut salaries and the picture of the economic devastation of Covid-19 comes into stark relief.

When asked what assistance would be most helpful, respondents most frequently chose financial support information. This makes sense considering 55 per cent reported that, as of late April, they were temporarily closed while only two per cent of responses indicated closing down permanently.

Interestingly, the second most popular type of assistance selected was local advocacy guidance. With every industry and community forced to rapidly hunker down and adjust to the realities of the pandemic, short-term rentals face an uphill battle to re-opening the proverbial door for guests.

Indeed, banning only short-term rentals while leaving other accommodation types open was the most frequently cited local regulatory response [36.4 per cent] with all lodging temporarily banned coming in second [23.1 per cent]. With the inherent social distancing benefits of home rentals, the short-term rental community faced [and still faces] significant regulatory challenges on the road to getting back to stability.

The report also asked industry experts to expand upon the results with their own insights.

VRMA government relations manager Greg Holcomb said in the report: “Throughout the pandemic, most industries saw a need to voice their concerns over business closure orders, travel restrictions, and other guidelines. The short-term rental industry was no different.

“However, unlike many other industries, short-term rentals are still a fragmented group of small businesses. This led to a less cohesive voice when communicating with policymakers, not having a seat at the table for policy discussions, and being overshadowed by other sectors of the travel and tourism industry.”

If short-term rental community members had had a seat at the table, perhaps we wouldn’t have seen so many local governments make the knee-jerk reaction of shutting down only short-term rentals. In many communities, short-term rentals rapidly responded to the sudden need for temporary housing and isolated accommodations brought by the pandemic. The report discovered that one in two respondents opened their rentals to first responders and healthcare personnel who couldn’t risk exposure to their families, stranded students and travellers, people who needed a remote work office that wasn’t their own kitchen table, and many others – often for free.

Short-term rentals also doubled down on their inherent flexibility. Twenty eight per cent of respondents adapted to mid-term or extended stays but only one per cent converted to long-term unfurnished rentals.

As VRMB founder Matt Landau put it: “The healthiest short-term rental businesses – due to their asset-light models and relatively low overhead – are able to overhaul pricing to fit consumer needs, pivot to new extended stays, and even put their operations on temporary pause: all without actually going out of business. This kind of resilience can be extremely valuable to communities looking to kickstart their economies in the coming months.”

The Covid-19 Impact Report covered other stats, too, from Covid-19 cleaning practices to staffing changes, to bonus market data from AirDNA, along with insightful commentaries from many other industry experts [get your copy here]. But as impactful as it is to have this information, what is more important is what we do with it.

We must make sure our communities embrace the benefits short-term rentals bring to them. Not doing so is no longer an option. We must generate our own positive press [and lots of it]. We must engage with our elected officials and join forces in a united front.

Covid-19 has given us an opportunity we can’t afford to miss, not to pull up a chair at an old table, but to build an entirely new one where short-term rentals are unquestionably essential today and tomorrow.