EP170: This Week in the World of Airbnb

EP170: This Week in the World of Airbnb

‘Another Successful Airbnb Stay’ – said no headline ever.

Though it’s a rare occurrence, when something bad happens in an Airbnb, it makes headlines. Unfortunately, an alarming incident took place at an Amsterdam listing this week when guests were late checking out, and an enraged host threw a woman down the stairs – while her friend filmed the confrontation.

Jasper is joined by David Jacoby, President and Co-founder of Hostfully, to discuss a better way to handle the situation if guests are late checking out. They also cover a study naming Airbnb the most lucrative of the gig economy platforms, the new regulations under development in LA, and Airbnb’s plans to enter the luxury space in 2017.

Finally, David and Jasper answer questions posed by the Facebook group around what consumables hosts should provide. They offer advice about buying in bulk, storing the excess, and offering inexpensive little things that make a big difference. Got a question for the Get Paid for Your Pad team? Email Jasper at [email protected]!

Topics Covered

Article #1: Airbnb Guest is Hospitalised After Landlord Pushes Her Down Stairs for Failing to Check Out on Time

  • Host faces attempted murder charge
  • Incidents like this are rare
  • Should have tried contacting guest first (call and message through platform)
  • Then contact Airbnb, local authorities if necessary
  • Confirm ETA and departure in welcome email
  • If guests need to checkout late, offer place to store luggage

Article #2: New Rules are Coming for LA Airbnb Hosts

  • Home-sharing ordinance in development
  • Will likely require hosts to register
  • Follows lead of cities like San Francisco, NYC

Article #3: Forget Uber and Lyft, This Is Where to Find the Money in the Gig Economy

  • Study found Airbnb to be most lucrative platform
  • 84% of gig economy workers make less than $500/month
  • Airbnb hosts make average of $924/month
  • Airbnb monetizes asset rather than labor
  • Unfair comparison, doesn’t subtract opportunity cost

Article #4: Airbnb to Launch Higher-End Luxury Service in Late 2017

  • Acquired Luxury Retreats for $200-300M
  • Promoting luxury service with celebrity marketing

Q: To what extent should I provide consumables to my guests?

  • Depends upon type of experience aim to provide
  • Marketing to higher-end, provide additional amenities
  • Worth investment to buy in bulk, team up with hosts in neighborhood
  • Have cleaning staff replenish on as-needed basis
  • Little things go long way (i.e.: transit cards, board games, coffee)
  • Prepackaged toiletries available, but can be wasteful
  • Provide small amount of food/drink, lock up excess

Resources Mentioned

Article #1: dailymail.co.uk/news/article-4681974/Male-Airbnb-landlord-hospitalises-guest-push-stairs.html?ito=social-facebook

Article #2:pasadenastarnews.com/business/20170708/new-rules-are-coming-for-la-airbnb-hosts-heres-what-the-city-is-planning

Article #3: skift.com/2017/06/14/airbnb-ramps-up-push-to-get-more-hosts-to-choose-instant-booking

DoorDash

Postmates

Etsy

Fiverr

Getaround

HostWell

Spacer

Article #4: foxnews.com/travel/2017/07/11/airbnb-to-launch-higher-end-luxury-service-in-late-2017.html

Slice

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This episode is sponsored by Aviva IQ. Aviva IQ automates messages to your Airbnb guests. It’s also free!

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Complete Transcript for Get Paid for Your Pad Episode 170

Jasper: Welcome to Get Paid for Your Pad, a definitive show on Air Bnb hosting, featuring the best advice on how to maximize profits from your Air Bnb listing as well as real life experiences from Air Bnb hosts all over the world. Welcome.

AD: Before learning about Aviva IQ, I used to spend so much time managing my guest communications. Now, with Aviva IQ’s easy to use, automated service, my workload has reduced by 80 percent. Did I mention its free? Automate your Air Bnb messages now at www.aviviaiq.com

Jasper: Get Paid for Your Pad, Welcome back everybody. I’m co-hosting today with David Jacoby, the president and co-founder of Hostfully. David, how are you?

David: Hey Jasper, I’m doing great. I just got back from six days of camping where I was completely disconnected, no phone, no data coverage, no email. I think the last time I was disconnected for that long – I can’t remember how long. I did the Inca Trail back in 2010 and that was about four days of being disconnected. It was just beautiful to be in the woods and relax and have some family bonding time.

Jasper: That sounds absolutely incredible. Where did you go exactly?

David: The Inca Basin, which is a huge park nearby. About an hour and half from San Francisco near Santa Cruz. They have UC Santa Cruz, the college there, and their mascot is the fighting banana slugs, and now I know why. There were so many banana slugs all over the place. Also, old redwoods, which are over 300 ft tall. Just a beautiful environment.

Jasper: Awesome, sounds great. I was in Sri Lanka a few weeks ago, in the middle of nowhere kite surfing, but I was actually surprised they had a really good internet connection. I actually ended up recording a podcast there and it was no problem at all. But now, I’m in New York. I’m on your side of the pond. It’s good to be back.

David: Awesome, the exact opposite of the middle of nowhere. Live it up in New York.

Jasper: Awesome. Yeah, so, let’s dive into this week’s news. There’s one story that been dominating the story in the world of Air Bnb, and it’s a shocking story. It happened in my own town of Amsterdam. I’m a little embarrassed. There was an Air Bnb host who got really upset at their guests that were a little late checking out. He threw them out – well, he threw one of the guests down the stairs, and she ended up in the hospital. It’s a serious thing. He’s in custody now facing charges of attempted murder. She ended up getting away with a concussion and some scratches. None the less, it was a pretty shocking event.

David: Yeah, pretty unfortunate, it seems like this stuff, the media loves playing this stuff up. It happens very rarely as a percentage, but when it does it becomes a big deal and people think it’s the norm.

Jasper: That’s true, if you’re a newspaper, you’re publishing an article and it says “Another Successful Air Bnb Stay,” no one is going to read it.

David: Yeah, look at us. It’s the leading story for this podcast. The Media knows how to get on a story that people like hearing about. Attempted murder seems like a bit of a stretch. Luckily it was caught on video. The guy was really annoyed, and I don’t condone him for doing it. I don’t think his mindset was “I want to kill this person” so some kind of battery, assault charge seems right. Murder seems like a stretch.

Jasper: Yeah, I think so, too. I watched the video. After the girl falls down the stairs, he actually runs after her and calls for an ambulance. My suspicion is he was shocked about what he’d just did. We’ll see what happens. Any case, it’s good to talk about what to do if your Air Bnb guests aren’t checking out. What if they’re late? They don’t want to check out – how do you handle that situation as a host? Obviously, you’re not supposed to throw them down the stairs, but how do you handle that?

David: Step One. Don’t physically assault the guest. I think this person was two hours late on their check out. I have a three-hour window between check out and when the next guest checks in, so I can understand someone being stressed and not knowing what to do, but they did the absolute wrong thing. This has actually happened to me, too. I had to think a lot about it in the moment and after that. I had a guest one time, they were just kind of aloof, they thought they were staying one day longer but their reservation was to leave that day. They were just out and about exploring the city. They weren’t answer their phone, they were international. I finally was able to get ahold of them and they realized the mistake and immediately booked it for one more day. Luckily, I didn’t have the same day turn around, I had to change when my cleaners were coming. But it had me thinking. What I’d immediately done in that case, right away, is try to call them. Email them on Air Bnb’s messaging platform so there’s a record of it there. As well as call them or text them or however you’ve been communicating with them. See if it’s just an honest misunderstanding. Related to that. Immediately after that call Air Bnb customer service and let them know what’s up so they can document it. It also puts the pressure on them to help solve the situation if it escalates to a worse situation. See what they recommend, ask them if they think it’s okay to start going in and cleaning up the place, and putting their clothes in the corner, and if not, change the check-in time and do something with your future guests and you won’t get dinged. So, step one, contact the guest. Step Two, contact Air Bnb, and then if you need to, call the police and your local authority to let them know there’s someone trespassing, it’s not a long-term agreement. It’s a short-term rental, they’ve extended their stay, they’re legally not allowed to be there. I’d almost tell Air Bnb, “hey, if you don’t give me any additional help, I’ve got to call the police.” That might motivate them to solve the problem.

Jasper: I’m also wondering how they can be two hours late. Because when I do my turn overs, my check out time is noon. The cleaning lady arrives at noon. If the guests are still there, she’ll tell them to pack up and leave. I find it hard to imagine it would take two hours. I’m thinking they might have been out. Maybe they were doing something in town and arrived back at the Air Bnb a couple of hours later. They mentioned that the owner was urging them to get out and they needed time to pack up. It’s hard to imagine that you meet your guest for check and out and two hours later they still need to pack. There must be something going wrong with the communication there.

David: Yeah, and from the little bit we could see from the video, it seemed like they were out the door. That guy just needed to take a deep breath and if he’d waited a couple more minuets everything would have been okay. But related to confirming check out time, one thing I do with all my guests and this might help set the tone in advance. In my welcome email before they arrive, I ask them, do you know what time you’ll be arriving on the 11th and when you’ll be checking out on the 14th. So, I do two things. I remind them of the dates and confirm their arrival and departure, and try to get some more insight into their schedule. I’ve had a few situations where they want to leave around 2 o’clock and I can remind them that check-out time is 11, but they can store their luggage in my garage if they want.

Jasper: It’s the same for me. I never had anyone stay beyond check out time. Usually they’ll ask and I’ll try to accommodate, but if not, I tell them where to store the luggage. Anyway, you brought up some good points on what to do if your guests don’t want to leave. Let’s move on to some of the other news that came out this week. There wasn’t that much. There’s an article that talks about there being new regulations coming up in LA. It seems like they’re going to follow San Francisco and New York and have their hosts register. There’s also an article, more interesting, about where the offer is comparing where people can make money in the geek economy, and they’re comparing Uber and Lyft with Air Bnb. The conclusion is basically that Air Bnb hosts make much more than any of the other geek economy workers.

David: The main reason for that, or the big reason, is that you have a physical asset that you’re able to rent out, so you’re not doing the work yourself the whole time. Obviously, there’s work running the business, but with Uber or Lyft, you’re driving the whole time at work making money. It’s a lot harder to scale that.

Jasper: It’s not really a fair comparison. If you really want to compare it, you’d have to subtract the costs, or opportunity cost, for example, if I buy an apartment, I’m investing a lot of money, but you have to pay mortgage payments, so you deduct the mortgage payments for some interest rate over the investment, subtract that from the amount to get it down to the amount of hours you’re actually putting in the work and look at how much you’re making. There’s a lot of platforms, they say Air Bnb hosts make 924 but places like Task Rabbit, Lyft, Uber, those are like $200-$400 range. There’s a platform called Door Dash, I’ve never heard of it, have you?

David: Yes, so delivery. Get whatever you want delivered to your house.

Jasper: Then there’s Postmates, Etsy, Fiver, Get Around. Get Around is something…

David: Get Around is like Turro, which used to be like Relay Rides, that’s more of a fair comparison to Air Bnb than Uber or Lyft because you have an asset. With Get Around, you have a car and you’re not using it so you can rent it out to someone else. I actually know some hosts, I’ll give a shout out to Keith Freedman with Hostwell, he’s got a car and he lists it on Get Around. They can rent it, there’s insurance, there’s coverage. Now it’s an extra asset. He’s getting paid for guests to use his car when he’s not using it.

Jasper: There’s another one with Storage.

David: Yes, Roost is what I’m familiar with. It was acquired by Spacer. It’s Air Bnb of storage. So, if you have a garage or attic and have lots of room ad your neighbor doesn’t you can rent out your extra storage space.

Jasper: So, if you’re renting out the spare room, for the days you don’t have anyone staying there, you can rent it as a storage space.

David: Right, but you need to make that space a permanent storage space, but you can’t rent it out for one month and then do the Air Bnb the next month, because you need to wait until that client takes their stuff back. It’s more for garages and attics.

Jasper: Awesome, well let’s quickly go through some other news items, Air Bnb to launch higher end luxury service in late 2017. We’ve talked about this before, they’ve acquired a Canadian company this year, they’re getting into the higher end luxury space, do you have any comments on that?

David: Yeah, so Luxury Retreats was the company they acquired. It was somewhere between $200- $300 million, it was a huge acquisition and they’re definitely moving into that higher end space. And promoting it as well with some of their tweets and super bowl marketing campaigns where they’ve had like Beyoncé and Mariah Carey tweet “thanks Air Bnb for the great stay” and they’re staying at this $20,000 a night place. I think they’re moving upstream and trying to get this reputation that it’s not just an extra bedroom in someone’s home, but you can also do high end vacation rentals through Air Bnb.

AD: Hosts, if you’re anything like me, you have multiple standard messages you send to every guest. I used to copy and paste those messages every time I had a new guest, but then I learned about Aviva IQ. I’m an absolute fan. I copied my repeatable messages into Aviva IQ and told it when I wanted each message to be delivered. Now, all my guests get personal check in messages and personalized check out messages at the exact time I want them to, automatically. I also use Aviva IQ to send a message to a guest when a vacancy exists after their check out date and invite them to stay longer. It’s amazing how it’s turned into free money for me on multiple occasions already. So, sign up for free at www.AvivaIQ.com. You’ll be glad you did.

Jasper: All right, so let’s move on to the readers’ questions for this week. I have a really interesting question from the Get Paid for Your Pad Facebook group, which is a group that’s open to everyone. People are discussing all sorts of stuff about Air Bnb. There’s an interesting question from Nicole, she’s asking about the extent to which you should provide consumables to your guests. More specifically, I have a coffee bar, do I stock it with coffee, creamer, sugar? Is it too much? Should I get more? What about toilet paper? I want to make sure I’m in line. How do you order it and how do you stock it? The first thing I’ll say, there’s no real answer to your question of what you want to provide with your guests because it really depends on what kind of experience you want to provide. If you’re targeting the higher end market, the people willing to pay extra for having extra convenience and more luxury experience, I would go ahead and supply guests with all sorts of stuff. If you’re more looking to the market at the lower end, you’re going to have to charge a lower price, so it might not be economical to buy all these amenities for your guests. That’s the first thing that comes to my mind.

David: Even on the lower end, I think a lot of these small things, they’re fairly small. It makes an impression and chances of getting five star reviews. Especially if you buy in bulk, these things might be worth the investment – you know, coffee creamer and stuff like that. The way I look at it is, what stuff can I provide that I can have automated or that my cleaner can automatically replenish on an as needed basis. In other words, I don’t promote the expectation that I’m going to be cooking them breakfast or that they’re going to be fresh fruit. But having coffee and breakfast snacks, I think that’s a big thing. Or some other frozen stuff you can keep in the freezer. Little things go a long way. Beyond food as well, having board games that are in a shareable space or what we do, we have transit cards. Getting on the bus here, you can’t go to a machine and buy a card, you need to have cash, and not everyone has cash. We kind of have almost a pay it forward. The last guest leaves behind the transit card and the current guest will use it, then it’s on an honor system and there’s a little left to the next guest. You can also bulk order from amazon or wherever, not that I would ever do this, from what I hear, they’ll bulk order the coffee and maybe keep a little for themselves, and then put it as a business expense.

Jasper: I’ve also heard of hosts that team up with hosts in their neighborhoods to bulk order. That way they can get a better prize and only one person has to order it. I really like the transportation card, by the way. That’s what I always do when I arrive in a new city, I get one of those cards. Another thing you can provide are toiletries – like shampoo, toothpaste, toothbrush. Basically, things hotels provide. If you want to provide a high-end experience, you can order those things pre-packaged.

David: There’s a bunch of those kind of high-end guest boxes that are coming out on the market where you pay $40 a box and it’s got all this stuff. The fault I see with that not every guest is going to consume everything, so it’s kind of a bit of a waste. I’d almost rather just order everything myself. In regards to the toiletries, when they stay a hotel they take the extra and bring it back with them so they have extras to give out.

Jasper: I have to admit, I’m guilty of this sometimes.

David: another thing related to this, too. I’ve gotten some cool kudos where if there’s something they might want to borrow or use, you tell them, you know, this is something I normally don’t, but you can use it. So please don’t put it in the review because I don’t want people to know it’s an expectation, but then they feel special. Like you’re giving them a secret something extra. We’ve done that with bikes. Of course, with bikes you need to be careful about insurance, if they fall on your bike, now it’s some liability. You want to make sure you have good insurance. There’s a new insurance company that seems pretty cool. Its Slice.is. They are pay as you go insurance. Basically, you don’t need to pay for a month or a year, but if you get one reservation for five nights, you pay for it for five nights. It makes it low and in tune with the amount you’re renting.

Jasper: To answer the question about where to store or how much to store, I’d say from my experience, when I started out, I bought a lot of stuff – drinks and snacks. I did notice people tend to take the liberty of consuming a lot or maybe taking some stuff for the road. The amount of soda cans my guests were going through were crazy. I started locking it up. If you’re going to bulk order, you might want to lock it up so they don’t smash through everything in one stay.

David: That’s interesting. I’ve found with most of my guests when we do our shared room, we have two units, a private in-law unit and guest room. We tell them help yourself to our kitchen. If you consume a lot of it, please consider replacing it. Just giving that heads up, that warning, having one coke is one, if you’re going to have a case, replace it. I rarely have guests abuse that.

Jasper: I think it probably has to do with the fact that you’re there. You’re hosting. There’s a difference between people having the whole place to themselves to actually hosting in house and being there yourself.

David: So, you’re saying don’t stock the fridge with cases of coke and beer and stuff, giving the implication you can go all out and have as much as you want. Stock it with a couple and if they want more, they can go buy some.

Jasper: Exactly, because in the beginning I’d say, “help yourself” but I didn’t realize that people would take it literally and at some point, the cost was getting out of control.

David: Sure, Sure.

Jasper: David, thanks so much for joining. Always a pleasure to be hosting these episodes with you

David: That’s it already? It went by so fast Jasper. I have so much more to talk about.

Jasper: I know, it always goes so fast. But after the recording we can keep talking for hours and hours, don’t ‘worry.

David: All right, well have a great time in New York and don’t stay in any illegal Air Bnb’s, be careful there.

Jasper: Of course. I would never do anything illegal. David, thanks. And all the listeners. I hope you enjoyed this episode and we’ll see you next time.

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