As the sharing economy permeates further into our daily lives – whether it be Uber, Deliveroo, Car next door or a growing list of others – a spate of new companies are emerging to feed off the extraordinary growth in these disruptive new online platforms.
Airbnb has proven to be one of the fastest growing and most lucrative of the new access economy platforms, amassing over 3.5 million users in Australia since its launch in 2008. According to the company, Airbnb has experienced a 200 per cent rise in usage in Australia in the past 12 months – making Sydney and Melbourne among the top 15 Airbnb cities in the world.
However, one of the problems facing property owners who wish to rent out their houses or apartments on Airbnb is that many people don’t have the time to manage the process of exchanging keys, managing online profiles, filtering and meeting guests and keeping the apartment clean between paying guests who expect a decent level of cleanliness for their money.
This becomes an even bigger problem when owners wish to travel interstate or overseas but still keep their property on the market and generating a healthy return. However, a growing number of local start-ups including Mybnbm, Urbankeyz, Homehost and Citysleepz are aiming to bridge the gap between the access economy and the real estate rental market.
Melbourne-based company, Airbnb Handsfree, takes on all the tasks required of successfully managing an Airbnb property without the owner needing to lift a finger, according to CEO and founder Ben Korman. The former mechanical engineer and software developer says he came to the idea after running a number of his own Airbnb investment properties and discovering how much work was involved.
“It dawned on me that there must be many people in my situation – who would love to host on Airbnb but don’t have the time to deal with the workload. I, on the other hand, was already managing a number of my own and had sufficient capacity to take on others.”
Airbnb Handsfree manages properties right across Australia but their housekeeping and concierge services are only available in Victoria. “Many people don’t even know that a service like ours exists. They want to host on Airbnb, they know they could be earning far more than they currently are but they just don’t have the time,” he says.
The business model starts with an initial consultation where the home is assessed – all that is required is a furnished home with minimal personal clutter. The company will then manage guest communication, a 24/7 property maintenance service, and even create a slick profile with professional photographs and web search optimisation.
On top of that they will take care of all the housekeeping including cleaning linen and restocking house essentials. In exchange, Airbnb Handsfree takes 13 per cent of the total incomings on the property. Housekeeping and cleaning fees are extra but can be charged to the guest as a cleaning fee through Airbnb.
Raphael Asher, who owns a one-bedroom converted warehouse investment property in Carlton, says he initially considered renting out his place via a traditional real estate agent, but eventually opted for the Airbnb Handsfree model.
“Naturally I was a bit anxious at first about giving my property over to be managed by someone else – it’s like your baby,” he says. “But once I’d seen how the business operated and what they could deliver I was impressed. I have dealt with real estate agents before and seen what they deliver but I’ve found this is a much better service than real estate agents,” he says.
Asher estimates his incomings are roughly twice the return he would be getting from renting using traditional rental methods. But he stresses his place is an optimal Airbnb property in a prime location – and that using such services may come with a higher element of risk depending on its location.
While the staggering exponential growth of Airbnb continues in a relatively benign regulatory environment in Australia, these new property management models threaten to seriously disrupt the traditional real estate market. A worrying knock-on effect could be that it will get even tougher for people to find affordable homes in sought after inner city areas.
However, Korman doesn’t believe businesses such as his will take over from traditional real estate agents any time soon. “We are finding more and more that people are choosing to rent out their homes on Airbnb rather than through traditional methods. I see this as most definitely having an impact on the rental market in the future.That said, given the size of Melbourne, I think we are still a fair way away from that,” he said.