November 21, 2023
A New Era of Stays
Airbnb’s potential pivot towards Month+ rentals in the bustling heart of New York City could be the fresh start the platform needs amidst the maze of rental regulations. This movement speaks to a modern tribe of renters – those seeking depth, not just breadth in their travel experiences. At Open Air Homes, our data has echoed this sentiment with rising demand and lucrative revenues. New York City, the emblematic hub of change, beckons Airbnb to harness this Month+ momentum.
In the midst of New York City’s tumultuous rental landscape, Airbnb finds itself on the precipice of a potential shift. CEO Brian Chesky, recognizing the current challenges, has been hinting at various avenues for the platform’s evolution, including longer rentals, car rentals, and intriguing dining pop-ups. While the latter two concepts remain to be seen in action, the emphasis on longer rentals resonates with a growing trend among renters and hosts alike.
The Dawn of the Month+ Movement
The term “Month+” feels right, more intuitive than ‘Extended Stays’ or ‘Medium Term Rentals’. It captures the essence of what modern renters are seeking: a more prolonged, immersive experience that transcends the brief and often fleeting nature of a week-long trip. Longer than a month, but surely not a home that they intend to stay at for over 6 months, let alone a year!
This isn’t just a hypothesis. At Open Air Homes, we’ve witnessed this transition first-hand. Back in 2019, we detected a burgeoning demand for longer stays and promptly began curating a portfolio that catered exclusively to Month+ rentals. And we were surprised at how quickly our Month+ portfolio began to fill up, often nearly 100% occupancy, and in many cases, making our homeowner partners a higher net revenue than traditional short term rentals.
Why this shift? The reasons are manifold:
– Environmental Sustainability: Longer stays equate to fewer flights, thus reducing the environmental impact.
– Community Integration: Staying for a month or more allows guests to truly integrate into local communities. They don’t merely skim the surface but delve deep, forging meaningful relationships with neighbors, frequenting local cafes, and patronizing neighborhood businesses.
– The Remote Work Revolution: The rise of the ‘work from anywhere’ culture means people aren’t bound by location, and a Month+ stay in a vibrant city can spark creativity and boost productivity.
My personal testament to this was my summer in Barcelona, which not only offered a refreshing change of scene but actively enhanced my work output and innovation. Following a similar work routine to the one I have in Los Angeles, yet in a different environment, opened my eyes to where Open Air Homes was succeeding in our business, and areas where we still needed to improve
A New Blueprint for Airbnb in NYC
New York City, with its diverse tapestry of culture, arts, and commerce, presents a prime location for Month+ stays.
Our advice to Airbnb, even though they might not need it as a behemoth in the industry, is twofold:
1. Education and Awareness: Airbnb should actively promote the myriad advantages of Month+ stays, emphasizing the benefits of longer trips and deeper cultural immersion.
2. Incentivize Month+ Bookings: To counteract the challenges posed by recent regulations and support NYC hosts, Airbnb could contemplate a temporary reduction in fees for Month+ bookings. This would not only assist hosts in offsetting potential losses but also provide travelers with a cost-effective solution to experience NYC more profoundly.
NYC: The Vanguard of Innovation
While Airbnb has a global footprint and can navigate challenges in individual markets like NYC, NYC remains a pivotal player and is a flagship city Airbnb does not want to lose. This metropolis has long been at the forefront of change and innovation, and its influence on the real estate market cannot be overstated.
In the face of adversity, NYC has the potential to redefine the rental landscape, pivoting towards Month+ stays. This not only offers a viable alternative to hosts considering shutting their listings but also positions NYC as the benchmark for what long-term rentals might look like globally.
In order to help NYC hosts through this tough time, our suggestion would be to do a marketing campaign encouraging guests to visit NYC for 1-3 month stints, and offer these guests lower commission rates for these bookings for the next year. This would give Airbnb a chance to use NYC as a test case for Month+ rentals worldwide, to see what insights that can learn about Month+ hosts and guests, and see how they can bring their findings to their entire market.
Until STR Regulations are Rolled Back in NYC, Embrace Month+ Rentals
Airbnb’s journey in NYC is emblematic of the challenges and opportunities inherent in a rapidly evolving market. By leaning into the Month+ trend, embracing the unique demands of modern travelers, and providing value to both hosts and guests, Airbnb can not only navigate the turbulent waters of NYC’s rental regulations but potentially usher in a new era for the global rental industry.