Short-term rentals for tourists did earn many times more than if landlords had an ordinary tenant in the apartment. At the time of coronavirus, however, we are all happy to rent at all anything. The virus pandemic returns Airbnb flats to conventional rental housing in the world’s metropolises.
The closure of borders and travel restrictions due to the pandemic of a new type of coronavirus causing covid-19 have brought a massive outflow of tourists, unfortunately this we have experienced severely. In the many years of operation, we have never had such experience. Along with that came a dramatic decline in demand for short-term Airbnb-style accommodation, with ordinary apartments practically substituting for hotels or tourist apartments. Apartments originally intended for tourists for a few days at hotel prices are gradually starting to appear in real estate offers for longer and regular rentals.
Long-term rental market flooded with flats
A total of 48,000 flats were recently offered in London via Airbnb, which is the world leader in the short-term rental segment. However, the card is currently turning due to anti-pandemic measures and the market for regular rental housing is literally flooded with apartments, originally intended for Airbnb in the British capital, writes Wired. They are easy to identify. Small, equipped, even often with towels in their photos, and their interior looks impersonal and generic.
In the week since 16 March, when the coronavirus pandemic began to erupt outside Italy, British real estate portals have seen an increase in the supply of flats for regular rent compared to the average.
UK real-estate market
RightMove, the UK leader in online real estate portals, registered a 45 percent increase in supply over the same period a year earlier. The flats were mainly in central London and were offered for rent at lower prices than normal market prices. A similar situation was recorded by this real estate broker in the sought-after Bath, which was a 78 percent increase. In Edinburgh, there has been 62 percent more rentals compared to the same period last year, and more than half in Brighton Coast.
In the same week in London, the real estate portal OpenRent also saw an increase in the offer of flats for longer-term rental. Compared to the same period last year it was up to 112 percent. According to Vice magazine, the largest number of small apartments with one or two living rooms. Throughout the UK, OpenRent recorded a 85.5 percent year-on-year increase in rental apartments.
Above average additions to the offer of properties for rent in London and Oxford also registered the Zoopla real estate portal in the same period. It also allegedly overestimates short three-month leases to better suit the price of renting apartments for a longer period of time, which means an average of 30% savings for tenants.
Short-term rental chaos
According to Wired, the collapse of Airbnb is literally a disaster for the short-term rental market. Many Airbnb apartment renters operate either by borrowing flats or through the app offering flats they rent from the owner, who is often contractually guaranteed a three-year market rent yield. During that time, they try to make the most of their short-term rentals.
The impact of the coronavirus pandemic on the short-term accommodation segment did not avoid Prague’s attractive tourist destination. According to the latest data, one fifth of all existing flats were offered via Airbnb in the heart of the Czech capital. Partly due to short-term rentals, especially in recent years, rents and real estate prices in the capital have risen to astronomical heights. In the second half of March, however, the offer of realtors began to appear furnished small apartments in the center or wider center of the metropolis, offered for relatively affordable money, but often only for one or two months.
Some Czech realtors in response to the coronavirus pandemic have already seen increased interest among clients who previously operated short-term leases in offering their flats to regular tenants for a longer period of time, Mecec.cz reported.
According to a Bloomberg report, a pandemic of coronavirus threatens the planned entry of Airbnb into an IPO, which could only occur in 2021 compared to the original assumptions.