Short-term rentals have been hit hard by the COVID-19 pandemic. Demand is down, rental platforms are laying off workers, and Airbnb itself has halted all marketing activities. Airbnb executives have even taken a 50% pay cut to keep the company afloat during these tough times.
Naturally, these headlines have many property owners worried -- especially those reliant on short-term rental income to pay the bills, or even just the mortgages on their properties.
If you've found yourself in this boat, you have options. While the vacationers might not be streaming in, there are still several ways you can use your property to generate cash -- or, at the very least, toward a good cause during these trying times.
Here are your options:
Switch to extended stays
People may not be looking for weekend getaways right now, but what they do want? Great spots they can ride out the storm in -- for the long haul.
Instead of marketing your property to vacationers and shorter-term stays, consider offering extended stay options. This can be an especially smart move if you have a property in a more rural or remote area, where social distancing is easy, or if you're in a spot with lots of amenities -- think a pool, hot tub, lake or beach access, etc.
In your listing details, bill the property as a COVID-19 retreat, and throw in extras your renters might need for longer-term stays. Maybe that's upgraded Wi-Fi for remote workers; board games, bikes, or video game systems for any kids; or just allowing pets on the property for a small deposit.
If you're opting for this route, make sure you study up on the current rules in your area. Some places have banned short-term rentals during the pandemic, so you may need to require your guests to stay a certain length of time in order to be in compliance. In Florida, for example, guests would need to stay for at least 30 days.
Look for longer-term tenants
The outlook for the COVID-19 pandemic changes daily, and there's really no telling how long social distancing might be required. If you're really looking to guarantee income on your property for the long haul, you might consider finding a longer-term tenant for a six-month or even yearlong lease. This would ensure you have the cash to pay your mortgage and bills while also giving the short-term rental market some time to recover, as it may be a while before the bulk of America has disposable cash to travel with.
Offer it as housing for frontline workers
Doctors, nurses, and other frontline workers are in desperate need of housing options -- places where they won't risk infecting their spouses, kids, and older loved ones while they work to fight COVID-19.
Though you could certainly offer your property pro bono to some of these workers in your area, you could also consider a significantly discounted rate if that's just not possible. This would at least offset some of the loss you'd otherwise experience due to decreased traveler demand.
Sell it and pocket the profits
If things are really desperate, consider selling the home altogether. It's not an ideal option by any means, but it would keep you from missing mortgage payments, losing income, or potentially hurting your credit score.
Though homebuyer demand isn't particularly strong right now, you may still be able to find a buyer. If not, those "We Buy Houses for Cash" companies are still out there working (I just got a mailer from one of them yesterday) and can be helpful in a pinch.
A quick note: The majority of iBuyers have paused operations for the time being, so these unfortunately aren't an option if you're looking to offload a property fast.
One more idea
If none of the above strategies will work for your current scenario, you might consider using this downtime to improve your property. Add in smart locks or other home technologies, make those repairs you've been meaning to do, or just renovate or upgrade some of the older or more dated elements in the home.
If you have a mortgage, cash-out refinancing might be able to help you pay for these projects -- and thanks to the current low rates, maybe even lower your payment, too.
The bottom line
The short-term rental market doesn't look like it once did, but that doesn't mean all hope is lost. Get creative in how you market your property, and consider pivoting into different types of renters. If you can manage that, weathering this storm might not be as hard as it seems.