Many people book vacation rentals on sites like VRBO and Airbnb (NASDAQ: ABNB) to enjoy the savings over the cost of a hotel room and the benefit of having added space. But while short-term rental properties are a great option for family getaways and reunions, some guests -- and property owners, for that matter -- abuse those platforms by using them to advertise and book "party houses" -- larger properties that lend to massive gatherings and a whole lot of noise.
Of course, sometimes house parties erupt through no fault of the property owners themselves. In fact, many owners have a strict no-party policy, but ultimately, they can only do so much to police guests once they arrive. But in other cases, property owners know exactly what they're doing -- renting out homes knowing full well that a series of loud, disruptive gatherings are about to ensue.
But VRBO and Airbnb are now teaming up to change that. And jointly, they may do a better job of addressing the problem once and for all.
The dangers of house parties
House parties pose a lot of risks, from fire code violations to noise ordinance violations. They also put real estate investors at risk of not being able to rent out their properties on a short-term basis.
If law enforcement agents repeatedly get called to break up parties, certain communities could begin to ban or restrict short-term rentals, hurting property owners' revenue. As such, making it more difficult for those gatherings to occur benefits the short-term rental industry on a whole.
To that effect, VRBO and Airbnb have launched their Community Integrity Program. As part of the program, both rental platforms will work with a third-party company to identify listings that have been banned from either site due to repeat party-related violations. And they're hoping that other rental platforms will join in that effort.
While Airbnb already has a global ban on party houses, it's not always possible to prevent large gatherings from happening, especially in remote areas where property owners often aren't on site. But by identifying those properties that are more conducive to parties, rental platforms can do a better job of nipping them in the bud.
In addition to flagging problematic vacation homes, VRBO and Airbnb are also looking to enforce harsher penalties against repeat offenders who book properties for the express purpose of throwing parties. Doing so could prevent scenarios where neighbors complain about excessive noise, to the point where short-term rentals are prohibited altogether in prime vacation spots.
Many people buy income properties that aren't conducive to long-term rentals, but rather, cater to short-term stays. But these arrangements, by nature, may attract renters who are less than reliable. It's common practice to vet a tenant who's signing a year-long lease, but for someone signing up to rent a home for a weekend, all that's really needed is a credit card number. This new initiative on the part of VRBO and Airbnb could result in stricter standards for short-term rentals -- and that wouldn't be a bad thing at all.