As property owners continue to cash in on the Airbnb gold rush, a handful of L.A. businesses are setting up shop to serve these prospectors.
Instead of picks and shovels, they’re selling data and fresh towels – and keeping an eye on looming regulations that could shut down the whole homesharing ecosystem.
Homeowners and real estate entrepreneurs alike have found they can make good money by renting out rooms or whole properties through Airbnb and similar platforms. But they’ve also found that being small-scale hoteliers comes with lots of work – from managing bookings to changing sheets. Now, businesses are cropping up as entrepreneurs hope to fill demand for those services.
“These companies have emerged because there’s a gap in what Airbnb provides,” said Scott Shatford, founder of Santa Monica’s Airdna, which provides market research for Airbnb landlords. “The platform currently doesn’t do a good job of assisting the hosts to price their listings dynamically or manage the properties.”
Airbnb, based in San Francisco, launched in 2008 and has grown rapidly. Through its app and website, it now lists more than 1 million short-term rentals worldwide – ranging from couches to entire homes – with more than 7,000 in Los Angeles.
While the market is large, and still growing, it also is rife with risk. Santa Monica and West Hollywood have begun cracking down on short-term rentals after protests from affordable housing advocates, and leaders in the city of Los Angeles are discussing ways to rein in Airbnb and similar services such as HomeAway, based in Austin, Texas.
The regulatory momentum keeps these new firms on edge since their success is closely tied to that of the homesharing companies. They argue a more limited rental market would stymie growth and possibly sink their businesses.
Bedspreads to spreadsheets
The services offered by these startups range from providing market analytics to more hands-on work such as cleaning and guest check-in. Airdna’s Shatford said at least half of the Airbnb hosts in Los Angeles outsource some or all of these tasks.
His company, founded in June of last year, combs through thousands of websites and listings to measure an Airbnb listing’s revenue, occupancy rate and other performance indicators.
Much of the information on Airdna.com is free, but hosts and other users can pay about $50 for more comprehensive reports that break down the performance of listings in a given neighborhood or even that of a competitor, giving them a better idea of whether they are under- or overpricing their own listings.