Airbnb makes renewed effort to increase supply as rents soar

Airbnb CEO Brian Chesky is making a fresh push to increase room supply on the travel platform, with average prices per night already up more than 40% from pre-pandemic levels.

Chesky said he was “not satisfied” with the soaring cost of using a short-stay website, and offered measures to address the problem, including a switch to paying for existing hosts. to help new servers set up on the platform, as well as a long-term plan to reduce cleaning fees.

Average daily cost for a stay on Airbnb is $156 for the July-September period, up 5% in 2021 and more than 40% higher than in 2019.

“If you’re looking for a city someday, sort of last minute, it’s not nearly what we want,” says Chesky. “So I’m not satisfied; I want it to be more affordable.”

Innovative attempt to increase supply comes just six months after Airbnb revamp your website in an effort to entice tourists to locations with more accommodation, as it seeks to ensure pent-up demand is not constrained by supply issues.

Chesky said the rent increase continues to be driven by supply constraints in popular locations but also by a spike in cleaning costs in customer bills.

“Cleaning fees are the biggest problem,” he said. “You expect one thing, you get another. . . overall ‘wow, why does this cost x?’.”

According to external data from AirDNA, the average cleaning fee for short-term rentals increased by 28% in October 2022 compared to the same month of 2019. In urban areas, the increase was nearly 50% in same period.

Living room in Brian Cheskey's Airbnb-rated home in San Francisco
Chesky’s home in San Francisco is among those listed on Airbnb © Brian PDP photography

In addition to changing the look and feel of Airbnb recently to show upfront cleaning fees, Chesky says that in the longer term, the company is looking at launching a marketplace that allows local cleaning providers to compete. more directly with each other in an effort to reduce prices.

Supply on the site has shown signs of picking up, with active listings up 15% year over year, though most of the new locations are in non-urban areas, according to recent company filings.

Airbnb this week rolled out several service updates to further increase the number of rooms and properties available. Among them is a program that will pay existing “super” organizers — those with a strong and long-standing track record — to help new organizers get set up on the platform, through meetings. video calls and other tutorials.

Airbnb says it will also verify the identities of all Airbnb customers by the spring of 2023. Coverage has been increased to $3 million and now includes things like cars or boats parked on site. Vacation.

Among the new hosts to the platform is Chesky himself, whose home in San Francisco is now among those listed. Checked guests will be able to stay during Chesky’s stay at the property, but there will be no charge.

“There will be security there, [but] it’s going to be pretty modest,” said Chesky, describing it as both a publicity stunt but also an attempt to stay “in touch”.

While travel stocks have been somewhat insulated from the broader market downturn by post-lockdown demand, Airbnb’s share price has fallen 38% since the start of the year amid growing concerns. on consumer spending.

Chesky said Airbnb has no plans to freeze hiring or change its hiring plans amid moves by tech groups in recent weeks to lay off staff after a slump in digital advertising and concerns about an economic downturn. Amazon is planning to cut about 10,000 jobs from the company’s workforce, while Meta last week lay off more than 11,000 employeesor 13 percent of its workforce.

But after making sweeping cuts during the pandemic in mid-2020, in which about 2,000 full-time employees and about 1,000 contractors were laid off, Chesky said he was not concerned about the process. Airbnb’s current model.

“We are not freezing, we are not changing any hiring plans. And unless something dramatically different happens, we won’t change anything. Absolutely not. Maybe we’re on the gas instead of the brakes.”


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