STR News Digest – April 2024

Successful hosts and property managers understand how important it is to keep on top of the latest STR industry trends and news. But when you’re busy with your rental business it can be hard to find time to sift through endless websites to find out what’s going on. No need to worry, we’ve done the legwork for you.

Here at iGMS, we like to keep an eye on the STR market and we follow the latest developments with interest. There’s always a lot going on, from ongoing discussions around the impact of short-term rentals and tourism on residential areas to new legislation, technological advances, and the departure of company presidents.

Keen to find out more? Take a look at our monthly digest to get the lowdown on the STR market.

Airbnb push for renter-friendly short-term rental policies

Airbnb acknowledges US renters are finding it more and more difficult to cover costs, and the company has recently made a $100,000 donation to an organization committed to helping renters stay in their homes. Airbnb has also been collaborating with US cities to push for short-term rental policies designed to allow renters to share their space and boost their income.

North America Airbnb policy director Mike Signer recently put forth his take on the situation stating:

“Homeownership should not be a barrier to entry when it comes to sharing your home. The vast majority of Hosts in the US share their space to help cover the rising cost of living, and we want to partner with cities to develop sensible short-term rental policies that grant renters the opportunity to do the same.”

Airbnb has also created the Airbnb Housing Council – housing organizations and experts who work together to address housing supply and demand issues along with affordability.

Algorithms – healthy competition or illegal conspiracy?

Management tools use algorithms to work out what hosts can charge, and this has proved useful for hosts and property managers. But there’s been rumblings that not everyone agrees with the practice. There have been several lawsuits arguing that access to price algorithms is akin to an illegal conspiracy.

The Federal Trade Commission and Justice Department’s Antitrust Division have intimated that using a consulting platform could violate the Sherman Antitrust Act 1860. They are effectively saying the availability of algorithmic pricing solutions is unreasonable and can restrain trade.

Not everyone shares this opinion and Shawn Walchef, Cal BBQ Media founder, echoed the thoughts of many in the hospitality industry with his take on the situation.

“Revenue management software is by no means collusion with algorithms. I would argue that revenue management tools like dynamic pricing benefit the consumer just as much as it benefits the business.”

Airbnb updates its extenuating circumstances policy

Airbnb has announced it will be updating its extenuating circumstances policy and from the 6th June 2024, it will have a new name, the Major Disruptive Events policy. The simplified policy will cover trips and experiences from the 6th onwards.

The updated policy relates to predictable weather conditions being explicitly eligible if they lead to disruption e.g. official travel restrictions, or a mandatory evacuation. Guests will be able to cancel trips (regardless of the host’s cancellation policy) and hosts will be able to cancel reservations minus the fees.

Tenerife Erupts as Residents call for government to limit tourism

There’s been unrest in the Canary Islands of late, with protesters arguing tourism has become a burden on the environment, housing, and infrastructure. Demonstrators have made their feelings known with signs proclaiming “This is not tourism, it’s colonization!” and “The Canary Islands are not up for sale!”

TUI CEO, Sebastian Ebel, sees things differently. He feels a housing shortage and unregulated booking platforms have caused the problem, rather than tourism as a whole. Ebel suggests the unrest will ease if Tenerife gears itself toward tourism that is socially responsible and economically successful for the local people.

The Government of Tenerife has also taken action to ease tension, announcing a tourist tax that visitors can expect to pay from 1 January 2025. Plans may also be afoot for new laws and regulations for short-term rentals.

Kimberly Miles is no longer VRMA President/CEO

It’s been reported that Kimberly Miles, is no longer president/CEO of the Vacation Rental Management Association (VRMA). The VRMA has a wide-reaching membership including visitor bureaus, property managers and hosts, rental companies, and industry suppliers. There are conferences all through the year, with the annual October conference considered the jewel in the crown.

Miles joined VRMA three years ago and put in place a membership category for individual hosts. But she also came under fire with some sources alleging a the former CEO did not attend enough VRMA events and failed to stay abreast of industry news. The full details surrounding Miles’s departure are scarce, but VRMA is yet to appoint a new CEO/ President.