All the travel we’re not doing because of COVID-19, for business or pleasure, has hit the market for short-term rentals pretty hard. Airbnb announced this month it’s laying off a quarter of its workforce — almost 2,000 people — and its long-awaited IPO may be on hold until next year.
Meanwhile, a new report suggests some owners of those properties may be pivoting to longer-term, seasonal rentals. In the 100 largest metro areas, furnished and seasonal rentals are up 21 percent since the end of February.
Kimberly Kent is an art broker, painter and former Airbnb host in Portland, Oregon. In March, she started renting her two studio apartments to traveling nurses for one- to three-month stays.
“We were getting about $100 a night originally with Airbnb. And what we’re getting with these folks now is $1,200 a month,” Kent said.
That’s less than half what she made when fully booked on Airbnb. It wasn’t just the coronavirus; a saturated market also played a role.
But as short-term bookings have dried up during the pandemic, new data from the listing site Realtor.com suggests a lot of hosts may be shifting to longer-term rentals. Tourism hotspots like Nashville, Tennessee; Austin, Texas; Orlando, Florida; and Las Vegas have seen the biggest increases. George Ratiu, senior economist at Realtor.com, said for many owners facing mortgage bills, “a slightly longer-term rental is a viable alternative, in the sense to bridge the gap between the lack of demand right now and a possible rebound later.”
But is there enough demand for those slightly longer-term rentals? Joshua Clark, an economist at Zillow, said a lot of renters may want more flexibility.
“If I’m a renter right now, and I’m seeing all the chaos going on in employment, I don’t know how long this thing’s gonna last,” Clark said. “I may not want to sign up for a full-year lease.”
And then there are all the people, especially in crowded cities, who may be looking to escape to the beach or the country.
Vi Nguyen, CEO of Homads — a marketplace for medium-term rentals — said with many employers allowing remote work, “employees are thinking, ‘Hey, I don’t actually even have to be here. I can have something a little bit more enjoyable, right?’ “
Not to be left out, Airbnb says more of its hosts are booking longer term, too, and offering discounts for stays of a month or more.
COVID-19 Economy FAQs
When does the expanded COVID-19 unemployment insurance run out?
The CARES Act, passed by Congress and signed by President Donald Trump in March, authorized extra unemployment payments, increasing the amount of money, and broadening who qualifies. The increased unemployment benefits have an expiration date — an extra $600 per week the act authorized ends on July 31.
Which states are reopening?
Many states have started to relax the restrictions put in place in order to slow the spread of COVID-19. Although social-distancing measures still hold virtually everywhere in the country, more than half of states have started to phase out stay-at-home orders and phase in business reopenings. Others, like New York, are on slower timelines.
Is it worth applying for a job right now?
It never hurts to look, but as unemployment reaches levels last seen during the Great Depression and most available jobs are in places that carry risks like the supermarket or warehouses, it isn’t a bad idea to sit tight either, if you can.
You can find answers to more questions here.
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