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increase occupancy coronavirus

This won’t be another post just talking about how Airbnb coronavirus cancellations are destroying our livelihoods. Today, we’re looking at the strategies one host is using to make it out of this alive.

This week, Airbnb shared some good news with their hosts.

They’re throwing in a lifeline of $250 million for hosts and an extra $10 million for Superhosts.

And that’s a big relief.

But the fight isn't over yet.

Even after the virus has settled down, it’s expected that the impact on the economy will be immense.

John Cunningham, founder of the Birdnest Group and operates with 31 units in a master-lease model. I had a chat with him last week to discuss his strategy for keeping his business afloat.

We talked in-depth on how he’s experiencing this crisis, what actions he’s taking, and how he's keeping sane.

Here are my key takeaways.

#1 Be transparent with your suppliers and vendors

People browse the corona news and ask themselves the question;

How will coronavirus affect my short-term rental business? What impact will it have on my life and my family?

This is also the case for your tenants, employers, vendors and all the people that you work with.

And they’re all wondering how you will handle the situation.

Communicating in an honest way is your best approach.

When the coronavirus set foot in John's operating area, his occupancy went down from 85% to a shocking 10%.

With 31 short term rental units, John’s revenue also has a huge effect on the revenue of his vendors and suppliers.

The first thing John did was getting in touch with them.

He realized that we’re all in this together.

We rely on each other, we’re part of a community, and we have to get through this together if we want to survive this crisis.

John explained the situation and asked them if they can lower their rates.

Most of them were able to lower their rates and understood the necessity of it.

Get the STR Coronavirus Survival Kit

We created a resource with swipe files, lists, tips and actionable how-tos for getting your business through this crisis.

# 2 Be transparent with your landlords

I’m from the Netherlands, and we have a saying there:

“You can’t pluck feathers off a bald chicken”

It doesn’t translate at all to English, I know. Nonetheless, there is some wisdom in it.

How will you pay your landlords if you don’t have any guests?

John has 31 short-term rental units, but owns only 3 of them. How he approaches landlords in this situation is crucial for his business.

His first step was the same as with his suppliers and vendors. He explained the situation and asked them if it was possible to lower their rent.

Although all the landlords reacted in a supportive way, there wasn’t much leeway.

Property owners, who deal with banks and mortgages, also have their credit reports to worry about.

Understanding the landlord’s situation is important but it’s only half of the story.

increase occupancy during crisis

This puts them in the same vulnerable situation as property managers.

John created a transparent solution.

He made a monthly “Profit and Loss statement.” This made it possible to analyze how much money he made after the expenses. So, when he paid the rent, he also sent this document to his landlords.

“You don’t want to come out of pockets, but you also don’t want them to think you’re hamstringing them,” John said.

#3 Have the conversation with your landlord as soon as possible

The economic impact of the coronavirus is not only affecting our industry. A lot of people are struggling to pay their rent.

It’s an uncomfortable position that makes people nervous. And while you may be tempted to postpone this conversation, don’t.

Have a conversation with your landlord as soon as possible. The sooner, the better.

The news Airbnb sent out on Monday was a relief. But it focuses on covering the cancelation costs for hosts.

It might buy you a little time, but it won’t help you find new guests.

So how do we attract new guests?

I asked John this question, and here’s his approach.

#4 Lower your prices

And not just a small discount – slash your prices.

John has properties on Airbnb that are usually $150 a night. But to attract new guests, he slashed his prices to $70. Another property went from $80 to $29.

Furthermore, he accepted one-night bookings. He felt it was necessary to do what you must do to cover some of the costs.

And the result was noticeable.

New bookings started coming in and his occupancy rate went up a staggering 40%. 

#5 Change your listing title and description

But be careful with what you say.

Airbnb published strict guidelines on listing titles. For example, you're not allowed to use COVID, quarantine or Corona in your title. You can read the full update here.

Airbnb argues that this could be misleading. And I agree with them.

increase occupancy during crisis

“Corona safe space, or Quarantine bunker sounds compelling, but you can’t guarantee there isn’t corona on the doorknob,” says John.

Instead, John is opting for titles like: Stay in a safe place at a great price.

#6 Find alternative ways to promote your property

Getting your occupancy rate up is your priority if you want to survive this crisis.

Creativity and a goal-oriented approach are key.

John promotes his properties where the demand for short-term rentals might increase.

In his case, he promotes his properties to the medical field and universities. This resulted in a booking from a girl who worked as a nurse.

Another option is pivoting to medium-term rentals.

Since last week, there’s been a 30% increase 4-6 week in bookings. You’ll have to take the right precautions when pivoting to medium-term rentals, for instance to prevent squatters, but it’s a solid alternative.

If you take the right precautions and have the right agreements in place, squatters won’t be an issue.

John analyzed his units that had no bookings for the next three months and he put them up for medium stay.

He even added an option to the lease agreement that made it easier for the guests to extend their stay. That way, if the coronavirus measures get extended, the contract is already in place.

Making it easier for your guest to extend also applies to your current tenants. You can proactively ask them if they would like to extend their stay for a couple of days.

Promote your properties on different channels, and start considering using direct booking channels, like your own rental website. You’ll reach a bigger audience and increase your opportunities for a booking.

#7 Maintain a healthy lifestyle

You might feel like you’re drowning and need to work on your business as much as possible. But make sure you pay attention to your mental and physical health.

I am not a medical professional. But healthy food and working out daily will boost your immune system and help you fend off the virus.

Also, think of it as a way of improving your productivity.

Your body needs fuel to be effective. Make sure you give it the right fuel. It might give you the edge to get through this.

stay healthy during coronavirus

#8 Do the chores you didn’t have the time for

The virus might have opened up your schedulea bit. Take this opportunity to do the things you normally don't have the time for.

Review your organization and find the parts that aren’t contributing to your goals. Cut them out or improve them. Train your virtual assistants for example or cancel a subscription you don’t need. Read a book, or learn something new to improve yourself.

It's unclear right now what the world will look like after COVID-19, but business will pick up again.

Even during the previous economic crisis, there were opportunities. If you invest the time in sharpening your organization and building systems, you can come out on top.

#9 Stay sane, connect with your community

With all the bad news it’s easy to feel overwhelmed or even experience Airbnb coronavirus anxiety problems.

Add the lockdown with the isolated feeling that comes with it, then staying sane could be a challenge for many of us.

A community helps you to stay on track.

We’re doing a lot of Facebook live sessions on the Airbnb Profit Club and expert trainings in the Inner Circle. Being a part of a community helps you find solutions that people are testing themselves. They’re sharing their stories and helping each other. People want to interact and don’t want to feel alone

John shares the same experience.

He’s connecting with other STR operators in the area. They call one another on a regular basis, just to have a chat or bounce ideas off each other.

Get the STR Coronavirus Survival Kit

We created a resource with swipe files, lists, tips and actionable how-tos for getting your business through this crisis.