As an Airbnb host, you’re probably prepared for when things go wrong. If your property’s electricity goes out, you have an electrician on call to help restore power.
But, what about natural disasters?
Do you have a game plan for what you’d do if a hurricane or flood hit your Airbnb?
What would you do if you had to evacuate and cancel bookings? How would you recover from it?
With Australia's recent crisis in mind, I wanted to share how you can prepare for these worst-case scenarios.
Peter Counsell and the Australian Bushfires
Peter Counsell is the Superhost behind the Clyde River Cottage in Southern Australia. He’s had to evacuate many times, and his Airbnb business has taken a hit from it.
The fires started in June 2019 and are still ongoing, as of March 2020. Because Airbnb peak season is from December to February, hosts are also dealing with extremely low occupancy rates.
Normally, hosts in this area are consistently booked out.
But now, they've had little to no bookings.
When the fires were new, Peter had several guests ask if it was still safe for them to visit. He reassured them and told them that everything was fine.
When the fires got worse, he had a few cancellations but most guests were only worried.
Surprisingly, these guests were more concerned about the view than the fires themselves.
Since then, Peter’s gotten no new bookings. His calendar has been relatively empty, and March still remains pretty open.
Dealing with Cancellations
Should You Cancel Bookings?
During this time, Peter faced a difficult question. Should he cancel his current bookings? Or should the guests cancel?
Hosts may be a bit hesitant to cancel first because they’re afraid of getting penalized by Airbnb.
Fortunately, Peter, as a Superhost, has access to an Airbnb hotline, so he contacted them to ask what he should do.
Airbnb cancelled all the bookings and contacted the guests on his behalf.
This was a seamless process.
No hosts or guests received any black marks for cancelling.
But, Airbnb isn’t always this helpful. Their tendency to help depends on the severity of the situation. In this case, both hosts and guests were at risk of danger.
When to Cancel Bookings
If the severity of a situation is still unclear, it may be hard to know when you or your guests should cancel.
When the fires got closer and closer, Peter still had guests booked.
He had some people traveling from Melbourne to Sydney.
Because they were already on the road, he didn’t want to cancel (or at least not without their consent).
As a result, he contacted all his booked guests to check-in with them. He told them they could cancel if they wanted to and get full refunds.
As it turns out, many of them still wanted to come. In fact, his last guests booked a four-night stay but only stayed three days. He texted them on the third day and told them they had to evacuate. There wasn’t any immediate danger, but they needed to leave before midnight.
How to Deal with Cancellation Policies
Cancelling bookings is only one part of the problem. How should hosts deal with cancellation deposits?
Depending on your cancellation policy, guests may lose some of their deposit.
A moderate cancellation policy means that guests are only entitled to a full refund if they cancel at least five days before arriving.
Peter, like many other hosts, decided to waive those fees and give guests full refunds. He also asked Airbnb to waive guests’ fees, since they take some of the cancellation deposits.
Otherwise, he’d have faced a lot of backlash on social media. This would’ve hurt his business in the long-run.
Recovering from Natural Disasters
After a natural disaster, there’s always a period of recovery.
For Peter and other Australian hosts, it’s going to take a while for things to return to normal.
In particular, tourism took a significant hit and is facing a long recovery period.
Peter’s area is known for its beautiful beaches, nature, and wildlife. Unfortunately, a lot of this has been burned and damaged.
It's even dangerous for some hosts to walk around in nature.
Trees half dangling, threatened to crash down at any minute, and everything’s black and ashes.
It took Peter two days to clean the outside of his Airbnb after it was covered in back soot.
In these situations, hosts don’t expect to get any bookings.
And, if it gets bad enough, the government may step in and give some money to help people get back on their feet.
On a Macro Level
Most of the recovery efforts will be from larger organizations and the government.
For hosts, it’s a matter of supporting these groups because they have more funds to inject into the area.
On a Micro Level
As a host, you’re really only able to put out a few social media posts.
This will help draw attention to the situation, but you’re not going to get bookings from that.
Most of the recovery done will be on a macro level. But, on a micro level, it’s your job to make sure your listing is ready to accept people when they start coming back.
Here are some things you can do in the meantime:
Allow One-Night Stays at Realistic Prices
While you may have expected five or seven-night bookings at top rates, that’s no longer going to happen. Be realistic with your pricing because you won’t be able to demand high prices anymore.
Your goal should be to make it as easy as possible for guests to book.
This means cutting down your minimum stay requirements to one or two nights.
Communicate with Guests
When speaking with guests, you want to be upfront about what’s going on.
Keep them updated as the situation changes.
So, if guests do decide to cancel, they have plenty of time to rearrange their travel plans.
Recovering from a natural disaster takes time.
You’re not going to get a lot of bookings for at least the first few months.
After all, it can take around 12 months for things to return to normal. You can’t really do much about that, but you can push on and hope for the best.
Open Your Home
Generally, you won’t be able to do much with your space post-disaster.
But, what you can do is think about how you want to improve the property. You’ll have a lot of time to implement whatever changes you see fit.
You should also think about the other people who’ve been affected. A lot of businesses will probably go out of business, especially if they rely on tourism.
Airbnb's Open Homes program allows you to share your home with people in need of temporary housing for free. In Peter’s case, this can mean opening up his home for evacuees and recovery workers.
But, if you’re budget-constrained, you can offer short-term accommodation to recovery workers.
This is definitely a viable option for hosts looking to recover some of their losses.
Unfortunately, there is the potential for a price war to occur.
If a disaster happens during peak season, hosts may compete for guests just to get some revenue. After all, hosts would normally be completely booked, but now there’s all this vacancy.
Supporting Peter and Other Australian Hosts
If you’re looking to support Peter and other Australian hosts, the best thing you can do is visit Australia.
Not all of Australia has been affected by the bushfires. There’s still a lot you can see and do, especially in southeast Australia.
Any kind of tourism helps inject more capital into the economy. There’s also the added benefit of getting great Airbnb discounts. Hosts are lowering their prices to attract guests.
Tips from a Superhost
Peter has three pieces of advice for newer hosts:
Read the Book
For Peter, Get Paid For Your Pad provided him with the foundations necessary for him to become a super successful Superhost. He still uses many of the insights from the book to guide his business decisions.
Understand Your WHY and Your Guests
A lot of people want to host because they think they have a nice property. But, that’s actually the last thing you should look at. You should focus more on the guest and what you want out of it and a little bit less on getting the property right.
The first thing you ask yourself should be:
What do I want to get out of Airbnb?
What is your WHY? Are you looking to make money, build a company, or explore an interest?
Then, you should ask yourself:
What kind of guests do I want?
Once you decide those two things, you can start modeling your property to suit those needs. And from there, it’s a matter of creating a great listing and having amazing photos.
Get Good Reviews
It’s super important you make a good impression from the very beginning. Otherwise, you risk getting pushed down to the bottom of the search results if you get too many bad reviews.
A strong start is going to put you in a great place to launch your Airbnb career.
This means giving careful thought to what you’re doing. You shouldn’t just jump in, put up a listing, and hope for the best. That’s not going to work because there’s a lot of competition out there.
Strive to be a Superhost
You should aim to become a Superhost as quickly as you can and maintain it. On top of the benefits, being a Superhost is a gauge of how well you’re doing.
If you don’t have Superhost status, you’re doing something not quite right. It could be your communication style or the place itself. You should look at your reviews and listen to what people are saying. That’s the best way to know how you can improve.
Diversify Your Short-Term Rental
Regardless of your hosting experience, you should have a website for your property. You want to maximize the chances someone sees your property. After all, some people may not use Airbnb or Booking.com for personal reasons. It's also a good way to protect yourself in case something goes wrong with a hosting platform.
It’s never fun thinking about the worst-case scenarios. Natural disasters can happen out of nowhere, and you should be prepared for them. It’s better to have a general idea of what you’re going to do than to be caught completely unaware.