Airbnb explodes onto hospitality landscape

Any property owner with a room to spare and a computer can easily earn a few hundred rands for letting travellers sleep in their home.

Airbnb, an online hospitality service where people can lease or rent short-term accommodation which includes vacation homes, apartments, homestays or hostels, has taken South Africa by storm.

In an overview of South Africa’s Airbnb community, it was revealed by the globally active company that between January and December 2015 the industry showed a 190% growth compared to the same period the previous year, attracting 7500 hosts who earned an estimated R28 000 for the year.

According to the report, 134 000 guests were hosted, staying an average of 4.9 nights in establishments throughout the country.

When it came to the hosts, research revealed that 66% shared their primary residences with guests, 49% were either self-employed or entrepreneurs and another 49% used the income to help them afford their homes.

Domestic guests amounted to 28%, with 18% visiting from North America, 12% from the UK and 11% from Germany.

Getting started is fairly easy: just register an Airbnb account where all of the information you provide will be verified. Ensure that the space you are willing to rent out offers a bed and a bathroom plus all the necessary amenities. Take pictures of the room/s on offer or provide possible patrons with a short description of the space, including all the perks and downfalls.

The final steps are to prepare yourself to take bookings, welcome your guests and start earning.

Guests provide reviews of the places they have stayed at, and hosts also give reviews of the guests. This system makes it easy for guests to find the perfect place, while hosts can be warned of potential bad customers.

And, according to Buffalo City Metro spokesman Samkelo Ngwenya, there is no need to rezone your property for business provided you are offering two rooms or less in your Airbnb enterprise.

However, Airbnb has come under fire from the Federated Hospitality Association of South Africa (Fedhasa), that has called on the government to intervene in an effort to ensure that the online hospitality platform complies with tourism sector regulations.

Tshifhiwa Tshivhengwa, Fedhasa’s chief executive officer, said irrespective of the number of rooms on offer, Airbnb owners were flouting a number of regulations governing the provision of accommodation in South Africa.

These include failing to register with the Companies and Intellectual Property Commission (CPIC), failure to report the income generated to the South African Revenue Service (SARS), not complying with health and safety regulations and not understanding the importance of a liquor licence if the establishment offers liquor and, in the case of larger BnBs, failing to rezone the property in question to business as per municipal by-laws.

“If you trade and receive income, you must be registered as a business by the CPIC,” Tshivhengwa said. “One of the issues that demonstrate a hospitality platform’s non-compliance is its failure to verify compliance with the South African Liquor Act, leaving it open for an informal renter to supply a complementary bottle of wine – which, slight as it may seem, can unfairly tip the scales in Airbnb’s favour.”

“This is just one example of the many ways that the formal sector can be disadvantaged by those operating outside of the regulation.

“There are rules of engagement and Airbnb needs to adhere to these rules. There can’t be a different set of rules to benefit only them. I know many will say it’s different, it’s a sharing economy and not part of the industry. But if you provide short-term accommodation for gain it’s not sharing.”

Tshivhengwa called on the Airbnb regulating body to verify all of the hosts listing their establishments on its website to ensure they comply with the regulations.

In response, Airbnb’s Velma Corcoran, who is a regional market consultant for Southern Africa, said the comments made by Fedhasa amounted to nothing.

“These are baseless allegations filed by lobby groups who want to avoid competition and protect their bottom line.

“Hosting via Airbnb allows regular South Africans to share their homes, boost their income and spread benefits beyond hotel districts to local communities and businesses. We want to be good partners to cities and work closely with authorities in South Africa and across the world,” she said.

[pullquote]“Hosting via Airbnb allows regular South Africans to share their homes, boost their income and spread benefits beyond hotel districts to local communities and businesses. We want to be good partners to cities and work closely with authorities in South Africa and across the world,” she said.[/pullquote]

This is not the only negativity the Airbnb concept has attracted.

In an article which appeared in Getaway magazine recently, writer Darrel Bristow-Bovey describes a trip to Amsterdam where, when trying to avoid the costs of staying in an expensive hotel, he decided to give Airbnb a try.

After initially booking with a host he found rather conservative, Bristow-Bovey relates how he later changed his mind for a more attractive-looking option. After cancelling with the first host and booking with the second, he received a message from his intended host the night before he was due to arrive informing him that the booking had been cancelled and if Bristow-Bovey was still interested in the room, he would have to pay extra for it.

In another story, which appeared in Cape Town-based social review site Relax With Dax, a travel writer lists the disadvantages he experienced first-hand when using Airbnb.

These include discrimination by some of the hosts, misrepresentation about the accommodation on offer and lack of professionalism from some hosts.

“When I went back and looked at the reviews of the place I stayed at, I noticed that they all focused on how friendly and helpful the host was.

“Nobody mentioned that the place was a dump. The reason for this is that they need the host to give them a good review as guests so that it’s easier to find a place to stay next time,” the article reads.

“Because I’m new to Airbnb, I can’t afford to have the only review of me as a guest be negative so I will also have to leave some sort of positive review for a place about which I don’t have much positive to say. This means the reviews are a lot less helpful than one might initially imagine.”

In a statement provided by Airbnb, a spokesperson who was not identified by the company said the price of the listing was entirely up to the host. Airbnb does provide smart pricing, a feature that allows hosts to let prices automatically go up or down based on changes in demand for listings that are similar.

“Smart pricing is based on the type and location of homes, the season, demand, and other factors – but ultimately hosts stay in full control of the prices they want to charge for letting guests stay in their home,” the statement reads.

“Airbnb has implemented a number of measures to ensure that the guests and hosts alike have the best possible experience during a stay.

“One of the main features to protect users is the Airbnb payment system which holds the money of a reservation until 24 hours after check in, giving the guest time to see if there are any issues.

“If guests experience a travel issue they will be entitled to a refund.”

By Zisanda Nkonkobe – DispatchLIVE