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News: How Atlanta’s Short-term Rental Market is Affected by Coronavirus?
May 20, 2021 at 11:00am | Danesha Ritzberg
A few months ago, the newest rentable Atlanta-area “treehouse” debuted, hidden on a plot of elevated land in East Point, just beyond the southwestern edge of Atlanta. Owner Darrel Maxam shared that bookings were going quite well.
Today, as the novel coronavirus and related restrictions have convinced a majority of metro Atlanta residents (and prospective Atlanta visitors) to stay home and avoid risking exposure to COVID-19, things are different.
“I lost at least 50 percent of my bookings for the balance of the month,” Maxam told Curbed Atlanta recently, regarding March. “For futures, meaning April, I lost literally all my bookings due to cancellations.”
Maxam blames what he hopes is a temporary loss of revenue to fear and uncertainty around how long the coronavirus scare will last. He says would-be guests “rightfully” pulled out of bookings due to lost jobs, having to unexpectedly home-school their kids,
and the mental shifts that come with such drastic change.
The treehouse, along with five other short-term rental properties Maxam owns on the same plot of land in East Point, uses Airbnb for bookings. Maxam says the company sent him an email declaring COVID-19 a national pandemic. He was also informed that Airbnb
customers who’d booked within a few weeks before the company recognizing the coronavirus as a pandemic could cancel with a full refund.
“So every one of course opted out because they were very scared at the time,” Maxam says. “They can still rent, but they’re petrified, because they’re going into a new space, they’re traveling, and you don’t know how clean the host’s household is. Just
because it might seem spotless doesn’t mean COVID-19 germs aren’t lying around on the countertops, you know?”
In his struggles, Maxam is hardly alone.
Another company with multiple properties is Atlanta Luxury Rentals. It offers direct booking but also lists properties at VRBO, where it’s considered a “Premier Partner” for consistently offering quality guest experiences.
Atlanta Luxury Rentals CEO Chad Salenius declined to make public the number of cancellations the company has received but shared that they usually see between six and 20 bookings per day, which came to “a grinding halt” once the coronavirus spread walloped
The company has four buckets for booking: the film industry, long-term travelers, short-term travelers, and insurance customers who may have recently had issues in their homes (falling trees, water damage) and need temporary shelter. They’ve now pivoted
mainly to insurance and long-term business travelers based in the U.S., whereas they could usually rely on companies based in Europe before travel restrictions.
Salenius says VRBO is trailing the wider industry in its response to COVID-19.
“They’re more in vacation and rural markets,” he says. “A lot of their clientele are people with beach houses or resort towns where you’d go skiing or something like that.”
He says VRBO markets got a bit of a “pump” when urban markets initially encouraged or mandated social distancing, which caused residents with options to flee their cities for places with landscapes and porches. But that seems to have dwindled, particularly
as rural and remote vacation markets have asked visitors to stop coming into their towns, or have insisted that new temporary residents self-quarantine for weeks upon arrival.
“Let’s say you’re in Denver,” he says. “You go to Vail, where you have a bigger house and footprint. So initially, the vacation side didn’t start dropping until the latter part of last week. It’s an interesting dynamic.”
Salenius says Airbnb is more focused on urban markets, and wisely started advertising to healthcare professionals, who need to be near work and may also want to avoid spreading coronavirus by reassimilating into their normal lifestyles with family
This week, Airbnb announced its earmarked $250 million “to help accommodation hosts impacted by COVID-19-related cancellations.”
According to a company statement, Airbnb will pay 25 percent of what hosts would have received for a cancellation based on their existing cancellation policies—and that’s retroactive to any cancellations since March 14. Emails with more details have
been promised “in early April” to hosts who will receive payouts.
Airbnb declined to provide Curbed Atlanta a broader picture of what local hosts are facing right now.
Maxam says he’s allowed full refunds, and he’s also advising customers that he’s keeping his cleaning standards up to CDC guidelines. A few people kept their bookings, he says, but most declined.
“We know this thing is going to last at least for another month,” he says. “What (hosts) should do is lower their prices, or find short-term renters. One dollar is better than zero dollars, in my eyes.”
Maxam says, for the treehouse, he’s focusing on the smaller weddings he planned to offer as it became available to rent.
“So far, I’ve been hit up by about 15 people who wanted to have weddings, but their wedding venue completely shut down. So now they have to go to smaller, more personal, intimate settings, which is perfect for my business.”
Salenius disagrees with Maxam about lowering rental rates.
“We have a brand,” he says. “We’d rather the property not rent than rent it for something that’s going to long-term hurt us. Once you drop your price to a certain level, you’re opening your property to people who are not going to take care of it as
they should, and you’re going to do more long-term damage to your property.”
Maxam hopes to see things come back at the end of April.
Salenius says he doesn’t expect a full rebound until the middle of June. But he does offer advice to the little guys on the short-term rental totem pole looking to navigate the pandemic: With 55 properties under the Atlanta Luxury Rentals brand and
full cleaning staff, he says the smaller hosts need to think about cleanliness first.
“Wait for the storm to subside,” he says. “It’s only going to be a couple more months. Make sure your properties are clean.”