Airbnb to shut down domestic operations in China

Airbnb is shutting down its business in mainland China this summer due to mounting costs and domestic competition, reported CNBC. The online vacation rental platform first launched operations in China in 2016, spurred by enthusiasm from Chinese tourists who frequently use it while traveling abroad. But according to sources who spoke to CNBC, Airbnb’s China segment became too complex and expensive to operate, particularly in light of the pandemic. Similar to what happened with Uber in China, a bevy of local competitors made it tough for the American company to gain an edge. Stays in China only accounted for one percent of the platform’s revenue for the past few years.

While a growing number of cities have banned or passed restrictive laws on short-term rentals, Airbnb’s fallout in China was due to entrenched competition and regulatory issues. Airbnb China operated differently than other Airbnb operations in other countries due to constraints by the Chinese government. The company was forced to sign agreements with local city governments and store its data on government servers.

Another more recent obstacle for Airbnb was an inconsistent flow of international and domestic visitors due to the pandemic, given China’s significant restrictions on travel. While global tourism is on the mend, the number of international tourist arrivals still hasn’t returned to pre-pandemic levels according to figures by the UN World Tourism Organization. The Chinese government has also limited “unnecessary travel” for its citizens in light of a recent surge in COVID-19 numbers, scaling back the number of potential domestic users for Airbnb.

New York City reportedly has more Airbnb listings than rentable apartments

New York City may have more Airbnb listings than apartments for rent despite a 2016 law banning short-term rentals, Curbed has reported. April apartment rental inventory in Manhattan, Brooklyn and northwest Queens numbered 7,699 units, according to the Douglas Elliman report. That compares to somewhere between 10,000 and 20,000 entire-apartment or entire-home Airbnb rental listings across all of NYC, as calculated by AirDNA and Inside Airbnb.

New York City has effectively prohibited short-term rentals (less than 30 days) in multi-unit buildings without the owner present since 2011, and made it illegal to even advertise such listings in 2016. If Airbnb renters are following the law, that means the listings are only active for short periods during the year.

Many could also be Brownstone “garden apartments” separated from but still a part of the main dwelling, which can be rented year-round by apartment owners. “A decade ago [those] may have gone to long-term tenants,” Curbed noted. The lack of that inventory on the long-term rental market is particularly noticeable now with rentals so tight and prices averaging $3,925 per month in Manhattan.

Other factors may have contributed to the NYC housing shortage, though, Airbnb said. “Over the past two years, our entire space listing supply citywide has decreased, and it now represents a fraction of a percent of the city’s rental units — and all while rent prices have trended upward and city-issued permits for new-unit development remain down by a double-digit percentage,” a spokesperson told Curbed in an email. In addition, some Airbnb listings may only be available for several weeks out of the year.

Airbnb is widely used by tourists and travelers, but hotels see them as unlicensed competition and city councils and housing advocates say that they take thousands of rentals off the market and distort market prices. The problem is particularly acute in cities with tight housing markets like New York and San Francisco, the latter of which also issued laws limiting rentals.

The extent to which Airbnb has contributed to a NYC housing shortage is debatable. However, the optics of having more Airbnb listings than rentable apartments isn’t great in a brutal rental market. “Bidding wars accounted for one in five new lease signings,” Elliman wrote. “Greater affordability is not right around the corner. More and more people are hunkering down.”

Airbnb’s big redesign helps you split stays between homes

Now that it’s relatively safe to travel again, Airbnb is unveiling an overhauled experience that includes some much-needed features for frequent travellers. To start, the reworked app now lets you search for categories tied to the home style, location or activity. You can look for places close to national parks, or even book a treehouse. Airbnb is clearly hoping you’ll book stays beyond the usual tourist hotspots.

The biggest addition, however, might be Split Stays. As the name implies, this lets you split a trip between two homes without having to separately book each location. You can split between categories or destinations, too. This promises to be helpful for long trips, or any travel where you won’t stay in one place.

And while Airbnb no longer offers refunds if you get COVID-19, it is providing some extra protections to encourage travel. A new AirCover program will either relocate you or provide a refund if the host needs to cancel (within 30 days), if you can’t check in or if the home doesn’t match the advertised claims. The 24-hour safety phone line has also expanded support to 16 languages, and AirCover is built directly into both the app and Airbnb’s website.

The reworked experience is available in the US today, and should spread worldwide this week. Airbnb may be stretching when it claims this is its largest change “in a decade,” but it might be enough to prompt a vacation after two years of huddling in place.

Airbnb will stop offering refunds when a host or guest contracts COVID-19

Airbnb bookings made on or after May 31st will no longer be eligible for refunds for COVID-19-related issues. The upcoming change to the extenuating circumstances policy will apply to cases where a host or guest contracts COVID-19.

The company says the host’s standard cancellation policy will apply instead. It says nearly two-thirds of active offer policies that allow guests to cancel up to five days (under the moderate policy) or up to 24 hours before check in (as per the flexible policy).

Reservations made before the end of next month may still be eligible for a COVID-19-linked refund if they meet the terms of Airbnb’s policy. There are exceptions for domestic reservations in South Korea and mainland China. Airbnb said refunds will still be available there for some COVID-19-related circumstances for the foreseeable future.

“Some in the travel industry stopped this type of policy months ago, while others didn’t provide one at all,” Airbnb wrote in a blog post. “After consultation with our medical advisors, as well as our community, we feel the time is now right to take the same step.”

For what it’s worth, Airbnb will soon start offering travel insurance. The product will be available in the coming months. Until then, the company says, those concerned that COVID-19 may disrupt their travel plans can buy insurance elsewhere.

The onset of the pandemic devastated the travel industry and Airbnb wasn’t immune from the impact. The company laid off 25 percent of its workforce, or around 1,900 jobs, in May 2020. It seems Airbnb is hoping to get back to business as usual. It noted that “many countries have now implemented living with COVID-19 plans.”

Still, the pandemic is not over. Around a third of the global population has yet to receive at least one vaccine dose. Data shows that, on average, 629,798 cases have been recorded worldwide in each of the last 14 days.