Freivalds: To be Airbnb or not to be

Published 5/30/2019

By John Freivalds

Talk about cultural isolation. Living on Lexington some 50 miles from downtown Roanoke I didn’t know what Uber was until a friend of mine from New York came to visit. He wanted to call Uber and see if they could take him to the airport. As he called, I asked him “what is Uber?” At that time there was no Uber that came out this far. Then I found out about Airbnb when friend Sandy told me she had listed her house on Airbnb. What’s Airbnb? I asked. Not surprisingly it’s an online company that started in San Francisco (www.airbnb.com)

Airbnb is an online booking service where you can find rooms and houses to rent in 191 countries, from yurts in Mongolia to castles in Scotland, usually at a fraction of what you would pay for conventional hotel lodging. One Airbnb offering is a castle for rent with “basic accommodation not far from what it was like in 1890 with the exception of an electric shower” (whatever that is). I am jaundiced in that I lived without electricity, toilets, running water, modern kitchen and rode horseback for a year in the Peace Corps in the mountains of Panama, hard on the border with Costa Rica, and I ran a dusty irrigation project in Iran. Now I want Five Star comfort baby! Oh yeah, according to Virginia Business there are 6,600 Airbnb’s in Virginia. More will be available as the government shutdown impacts the economy.

People like Sandy who find themselves as empty nesters with rooms sitting unused and can tolerate strangers staying in their houses (without ticking off their neighbors) can list a room or the entire house for rent and make some extra cash. Sandy’s pitch on the Airbnb website went like this: “Wooded walkout apartment in upscale neighborhood. Luxury and comfort on quiet residential street close to restaurants, shopping, close to downtown and bike trails. Onsite parking for 1-2 cars depending on season. Perfect for couples or families for special events or sightseeing. Separate entrance.” The only caveat is “no pets, parties or events.”

Airbnb takes a 3 percent booking commission from hosts and around 15 percent from guests. There are plenty of criteria to list for searching a property. This can go from spare room to an entire house to a swimming pool to having washing machines. There is a demographic that loves Airbnb. To wit, you can live like a local, there is flexibility (you don’t have to adhere to check out times), you get more space for less money, you get one-on-one interaction with the owner and amenities like a full kitchen. When I was young and traveled the world as a Peace Corps volunteer or when my late wife Margo took a year off from corporate America to travel the world, the Airbnb (then called hostels) were attractive.

Other benefits are Airbnb guests state that they are supporting local business. Most hotels are parts of chains and the benefits accrue to the company located elsewhere. Virginia Business says that almost 7,000 Airbnb’s in Virginia earned $41 million in 2017. But those who list their properties often encounter problems with Airbnb who is accused of being a “faceless organization.”

So, what do residents in communities feel about residential neighborhoods having short term rental properties? Sandy had to apply for a license from Roanoke. Most local communities allow Airbnb but several prohibit short-term rentals (less than 30 days). But again, the success of Airbnb shows that the internet is changing the way our economy works — for better or worse.