Airbnb Rental Model Becomes A Victim Of The Coronavirus

Apr 28, 2020
Originally published on April 28, 2020 2:36 pm

STEVE INSKEEP, HOST:

The short-term rental company Airbnb is in trouble. The pandemic has nearly stopped travel and made staying in a stranger's home less appealing. So what now? NPR's Bobby Allyn has been talking with the company's CEO.

BOBBY ALLYN, BYLINE: His name is Brian Chesky. These days, he's holed up in his San Francisco home all by himself, and he told me over Zoom he's been making lots of chocolate chip cookies.

BRIAN CHESKY: People call it stress baking. Well, if that's the case, I'm going to be a Michelin chef pretty soon because I got enough stress to do a lot of baking.

ALLYN: That's certainly understandable. Twelve years ago, Chesky convinced people that staying in someone's house would be a better experience than going to a hotel. More than 150 million people worldwide bought into that idea. But this public health crisis is the biggest threat Airbnb has ever faced. Chesky realized it last month when shelter-in-place orders began to sweep across the country.

CHESKY: That was the moment when I think we realized life is going to change, and it may never quite be exactly like it was before. There's going to be a prolonged storm and then a new normal.

ALLYN: If Airbnb is going to reach a new normal, they're going to have to convince germ-wary travelers to feel OK spending the night in a stranger's home. Airbnb is partnering with a former U.S. surgeon general to train hosts in how to disinfect their homes. And all rooms will be required to be empty for 24 hours before someone stays.

CHESKY: In this new world, I think cleanliness is paramount. And so this is now a paramount priority of Airbnb as well.

ALLYN: It's a bet that people like Janice Honeycutt (ph) are counting on. She has 100 acres of land nestled right along the Appalachian Trail in eastern Tennessee. In addition to her Airbnb, she runs an organic farm, a campground and a massage therapy business.

JANICE HONEYCUTT: You know, every single one of them, we now realize, was dependent on hospitality. So other than the farm, you know, we really don't have any choice but to just wait it out.

ALLYN: Honeycutt has seen her Airbnb cancellations stretch into the summer and fall. She's planning to rewrite her listing to emphasize how squeaky clean her rooms are in hopes that it will eventually bring back guests.

HONEYCUTT: You know, if they're not sure if we've sanitized everything, there is spray disinfectant and all kinds of stuff in the suite so that, you know, they can double do it if they want to. It's right there for them.

ALLYN: In rural Tennessee, she says she's way too invested in Airbnb to pull out now. Other hosts aren't so sure. Josep Navis Macit (ph) quit his job as a college professor to focus on his Airbnb rentals in South Philadelphia. He even bought his neighbor's home just before the pandemic. He planned to double his $2,000 a month Airbnb income.

JOSEP NAVIS MACIT: In the middle of the renovations, boom, all the coronavirus crisis hit, and I had to cancel my reservations. And I had to tell the contractors to stop working.

ALLYN: Navis Macit is looking at the second home he just purchased and thinking, if not an Airbnb, then what? Maybe you rent it to a family. Perhaps put it back on the market.

NAVIS MACIT: So I have now two mortgages. I don't have any income, and I don't know when I'm going to be able to start doing Airbnb again.

ALLYN: Airbnb has set aside more than $250 million to help hosts, but it covers just a fraction of what they used to make. Back on our Zoom call, Chesky, who has a founder's sense of optimism, says hosts shouldn't fret. He says his company's global success was due to a basic insight about human behavior. People want to stay in places that have character and feel more intimate than stodgy corporate suites. A pandemic, he says, won't change that.

CHESKY: There is a fundamental human need to explore, and I think that travel will be, eventually, much larger after COVID than before. It may take years.

ALLYN: That's a far cry from what was supposed to happen. 2020 was set to be Airbnb's big year. Chesky was working on the company's paperwork to go public right when he realized his world was about to be turned upside down.

CHESKY: In this crisis, it felt like I was the captain of a ship, and a torpedo hit the side of the ship.

ALLYN: A banner year is no longer on the horizon for the CEO of Airbnb. Instead, he's just trying to stay afloat. Bobby Allyn, NPR News, San Francisco.

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