As the saying goes, ‘Keep your friends close and your enemies closer.’ So when Jasper had the chance to speak with one of Airbnb’s fiercest critics in Amsterdam, he took full advantage of the opportunity and invited the journalist to be a guest on this week’s Get Paid for Your Pad.
Sander Schimmelpenninck is the editor-in-chief of Quote magazine, a Dutch monthly publication most well-known for the Quote 500, a list of the 500 wealthiest people in the Netherlands. Quote focuses on the business, finances, and networks of life at the top. In 2014, Sander wrote an opinion piece on the dangers of Airbnb in the Amsterdam market, discussing the impact of the vacation rental platform on the city as its concept shifted from that of a shared experience to a money-making machine for real estate investors avoiding income tax. He shared his concerns about the lack of regulation and how Airbnb made it increasingly difficult for Dutch residents to find an affordable home in a city overrun with the wrong kind of tourists.
Though he is not opposed to Airbnb as a concept, Sander does advocate for local governments to establish legislation specific to the needs of each city. Today he shares his love-hate relationship with the vacation rental market, explaining why regulations were necessary in Amsterdam, the downside of hosting so many tourists in the city, and his take on short-term rental management companies. Listen in as Jasper and Sander debate the pros and cons of Airbnb!
Sander’s introduction to Airbnb
Why Sander wrote the anti-Airbnb article in 2014
The downside of tourists vs. Dutch renters
The current Airbnb stats in Amsterdam
Sander’s take on Airbnb regulations in Amsterdam
Why Sander supports regulations specific to each city
Sander’s attitude toward other vacation rental platforms
How Sander views short-term management companies
Email: [email protected]
This episode is sponsored by Hostfully.com where you can create a custom digital guidebook for your guests!
Complete Transcript for Get Paid for Your Pad Episode 187
Jasper: Welcome to Get Paid for Your Pad, a definitive show on Airbnb hosting, featuring the best advice on how to maximize profits from your Airbnb listing as well as real life experiences from Airbnb hosts all over the world. Welcome.
AD: This episode is brought to you by Hostfully, a company that helps you make beautiful guidebooks for your listing. Especially for Get Paid for Your Pad listeners, get two free months of their premium version for free. Check out Hostfully.com/Pad
Jasper: Welcome everybody! Episode number 187! I am in my hometown of Amsterdam and today I have a special guest, it’s a really special guest, because he is someone who has been writing about Airbnb for a while in a magazine called Quote. It’s a magazine that talks about rich people, they have a list of the 500 most rich people in Holland every year. He’s been a critical voice when it comes to Airbnb. Of course, we haven’t had many critical voices on the Podcast. I’m happy to welcome Sander
Sander Schimmelpenninck: It’s nice to be here and it’s nice to get the invitation from someone from the enemy side, I would say.
Jasper: They always say, keep your friends close but your enemies closer.
Sander: I’m not a full enemy, I think Airbnb is a great invention, it works perfectly. I use it a lot myself. But I do feel that Airbnb can have a big impact on cities and you have to be careful with that and make a good assessment of every city.
Jasper: You published an article in 2014, it was a pretty good article. I read it again today. In which you really analyze the Airbnb market in Amsterdam. You look at the people involved, the upsides, the downsides. When did you first hear about it?
Sander: I first heard about Airbnb I think when I was traveling the west coast of the united states where I have hippy family members. They were talking about this new initiative that enables you to stay at other peoples’ homes at a price that is lower than hotels. They were enthusiastic. They were extremely happy with it because it made them money. Some of them, like you, made a lifestyle out of it. IT was interesting to see. Of course, everybody can make money, but the thing that annoyed me at first, later it’s about tourists taking over the city, but at first, it was the fact that they weren’t paying taxes. If you work hard and pay income tax, then it feels very unfair if people are getting money, free money, and not paying taxes over it. That was my annoyment at the time. I started reading more and getting a better image of what it was.
Jasper: Right, so. You felt that it wasn’t fair to people who were paying taxes. Which is true in the beginning. There was unclarity about how you were supposed to pay taxes. I remember when I Started, we have a tax system with different boxes, I wasn’t sure if it was box 3 or box 2. I remember asking a lawyer and he couldn’t tell me. Let’s go back to 2014. You heard about people making a lot of money on Airbnb and you were thinking people should be paying tax. IS that the reason you wrote the article?
Sander: No, that was a more personal thing. The reason I wrote the article was because I saw that it could be something big. Back then, in 2013, when I wrote the article, it was published a year later. It was still relatively small. It was the early adapters. The millennials like us who were quitting their jobs and finding new ways to pay bills. I saw what it could do. We write about wealthy people. I heard that if you go to the cafes where the big real estate guys go, you start hearing them talk about Airbnb. If you rent them out to a normal couple who pay 1,000 euros, you can double that. Then I realized, if they discover this, this will have an impact on the city and we’re not going to like it. I thought this is worth a story. Especially in Amsterdam. We have such a small, puppet-house city that’s vulnerable. I thought it was the right time. You could see back then, those years, those years you saw the shift from the early adapters who were cute, not on a big scale, to serious real estate people, millionaires, buying property with the only purpose of renting out to tourists. That’s something which has been going on until now. I think if you go to the same cafes where they were talking about Airbnb in 2014, they will now say they’re getting out of it. It’s too risky. People write about it. It’s not worth it. They make money anyway with real estate in Amsterdam. It was also the death of the crisis. A lot of people like us graduated, good education that had problems finding a job. If you’re lucky enough to have parents with money or can buy your first home based on first salary, you had a chance to monetize that. It was a crisis thing back then. Now, real estate, everything in Holland is booming. You can rent it out to ex-pats. That’s replaced Airbnb as a good deal for homeowners. Ex-pats pay more than others. You don’t have the hassles.
Jasper: I used to rent out my own apartment to ex-pats from the landlords perspective, I think you own a home you rent out?
Sander: Yes, I own two apartments now. One I’ll be renting out this weekend. My first apartment, I’m moving out of, into a new one and I will be renting out my old apartment to Dutch people. I specifically asked for Dutch people, I’m not a racist, just because I think it’s important Dutch people live in our capital.
Jasper: I know it’s hard to find an apartment to rent. When I first came to Amsterdam, I didn’t have money for an apartment. I rented a room. Then an apartment, and it was hard to find for a reasonable price. When I owned my home, and you have people living in your home, it’s hard to get them out. I wasn’t certain what I wanted to do. But once people are in, it’s hard to get rid of them if they don’t want to.
Sander: That has changed. That’s stronger than it is, it’s not really like that. If you commit to a one or two-year mental contract, you’re committed to that. I’m renting out my apartment to a couple. They will not have a family in my apartment because it’s not suited for a family. You know how these apartments look. They will not stay. That risk is always used as an argument to put tourists there, but I think that’s more downsides than having loyal, good renters who want to take care of it.
Jasper: Let’s talk about some of those downsides to having tourists in your apartment
Sander: In Amsterdam, we have the problem where we attract the bad kind of tourists. The stupid laws that make it legal to have all kinds of drugs, we have a bad image, people think they need to come here to see hookers and smoke weed. You attract a certain type of tourist. We haven’t been branding our city in the right way. It’s beautiful. It’s young. It has all kinds of attraction. And yet, it’s branded like some sort of booze and hookers capital. It’s stupid. We have a huge airport. We are big travelers as Dutch. But that means they come back full. They come full back. The biggest problem with Airbnb is the last years has been that traction. Low-cost tourists. We should just raise our prices. Make it expensive.
Jasper: You think Airbnb has caused a rise in tourism?
Sander: Definitely. If you look at the hotel prices, they’ve always been high. They’ve become higher over the last years. And the Airbnb price, yeah you have one sleeping bed and a full bed, and you can rent an apartment and you can split it, and yeah, it’s just not that much. You cannot find a hotel for that price.
Jasper: I was looking at Air DNA, a company that gathers info about Airbnbs around the world. According to them, there’s 15,000 active rentals in Amsterdam with an average rate of $178, or 150 Euros. Some interesting stats, 75 percent of the listings are entire home rentals. 25 percent are private rooms. If you look at the rental activity, right now, the rules are such that you can’t rent out more than 60 days, you can’t get around it. IT shows up in the stats because it’s 75 percent of the apartments are booked between 1-3 months and about 25 percent are booked 4-6 months or more. I think those must be the private rooms. Which, makes sense. But you can’t do more than 60 days. Unless you have multiple accounts, right. Also, if you look at the growth, in 2010 there was only 100. Then up a bit, 400, 1600 in 2012, 4,000 in 2013, 800 in 2014, then 18,000 in 2015, 32,000 in 2016, and 40,00 in 2017. That’s cumulative. There’s 10,000 active hosts. 88 percent have a single listing. 12 percent have multiple. 18 percent are super-hosts. Those 11 percent that have multiple listings cover 30 percent of multiple properties, averaging 3 listings. You think It’s gotten better?
Sander: If you compare the statistics to the earlier days you could say it’s working. I’m not anti- Airbnb and not about not letting people making money. You need to regulate the government. They seem to be getting better.
Jasper: You’re fairly happy about the current regulation?
Sander: I think 60 days is still quite long. I think you should limit to 30. Who takes 2 months of year for vacation? This is specific to Amsterdam. You need to see cities as different. There are all kinds of local differences. I own a house on a Croatian island. There’s a lot of empty houses. Every euro you bring to the country they’re happy. To limit the days there would be ridiculous. Then you’re limiting economic development. Here in Holland we’re developed. It would be disgraced to be fully dependent on tourism. You need to be attractive to people who want to live and work here. There are also big financial sector where you used to work. If you live in an apartment here with neighbors upstairs renting out for 60 days a year, that means that half the year, you’re meeting tourists in your halfway. I think that’s much. I think that’s big. I think that’s a big violation of being home. I’m already having difficulties coping with the enormous amounts of people here, that’s a personal thing. If you have 60 days, you’re stuck with tourists in your home for half the year.
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Jasper: How do you feel about renting our private rooms? Shared rooms? Spare rooms? That’s still allowed. You can do it the whole year.
Sander: Then, you’re living with that person. That’s fine. WE have a lot of shared homes. I had a friend who lived in my home. If you do that with a tourist, yeah, it’s been used as a trick. Big real estate guys put a student in their homes for next to nothing. They have them play concierge. But, if you can provide more or less, free living space, that’s a good thing. Then, you at least have someone who is there, part of the neighborhood. That’s not…yeah. It’s a way of avoiding the rules, but a good way.
Jasper: What about the other platforms? I suspect a lot of people are using Airbnb for 60 days and then using the rest of the time on other platforms. Do you think Amsterdam is going to enforce other platforms to adopt the same rules?
Sander: I hope so. I know that Booking.com is aggressive about taking a share of the rental pie. They’re more aggressive and nastier than Airbnb. Airbnb is quite friendly. A good system. Booking wants its share. The Local government should have the same rule for each company. Of course, they should.
Jasper Interestingly, Booking is a Dutch company.
Sander: It was! It was sold too early. If I go abroad, booking is the biggest. In Croatia, for example, it’s the biggest. It’s a bigger cut than Airbnb. They’re coming for it now. The local government should be stricter on Booking. Airbnb is friendlier as a company
Jasper: I think you’re right. They’re very focused on short-term rentals on their platform. I was at their office last year because they invited me because they wanted to know more about Airbnb and how to do it. I had a conversation with them. They had a whole short-term rental team. They’re probably happy about Airbnb being restricted. Booking was initially a hotel booking site. I think you’re expecting a hotel. I’ve heard hosts that are renting out, they’re a different travel. An Airbnb traveler is educated, travel-loving, versus Booking guests just want accommodation. I think it makes sense to treat the platforms the same. There’s a lot of them. There’s homeaway, trip advisor, you have the channel managers. You can manage all those listings. It’s fairly easy to rent out on different platforms. There’s short-term management companies.
Sander: These short-term companies come in different kinds. The biggest is In Bnb, I’ve been critical, but they’re fairly okay. They will not take an illegal apartment. You have others that are aggressive. They pay up front, you can only make up for the money they give away by renting it out illegally. So, yeah. If I would rent out my apartment in Amsterdam, I’d go for such a company. I wouldn’t want the check-ins. But, then again, that’s not how Airbnb was supposed to be. It was supposed to be a shared experience, and if you have professional companies doing all that, you lose the idea that it was founded on
Jasper: Is there anything else you wanted to share with the listeners? Final thoughts?
Sander: I think Airbnb is a good idea. I think there’s a responsibility of every user of Airbnb to make your own assessment. Is this an Airbnb experience or a hotel one? I’d advise everyone to sue it as I do. Only use it for those shared experiences. It’s fun. Not harmful. Don’t go for hotels camouflaged as apartments.
Jasper: Are you planning to write more about the short-term market?
Sander: I’m quite done with the subject. I’ll follow it closely, I feel like in Amsterdam we’re at the end of the storm. I think we all know how it works. The ups and downs. I don’t feel the urge to write that much about it anymore. Also, I’m in Sweden and Croatia and I don’t need to get annoyed by tourists that much anymore.
Jasper: It’s an awesome place, super fun. Recommend you check it you in Croatia. Thank you so much for your time, it’s been an interesting conversation. I hope you to see you Friday!