Secrets about Hungarian AirBnb revealed

Those who let flats for a short period of time in Budapest and are pretty good at it, can make a good living. However, AirBnb has slowly started to decline, Forbes.hu reports. The magazine made an interview with Balázs Schumitzky who runs 23 flats in the capital. Here come some interesting details about AirBnb.

How should a flat let to AirBnb be utilized, so that it makes profit?

The proportion of utilization should be at least 70%. We obviously cannot make it in low season, but in high season, we sold 27 or 28 days out of 30.

Do you have “typical AirBnb guests”?

No longer. We had mainly young guests a couple of years ago who were the fastest to accommodate to new and irregular renting, but today, everybody is capable of booking, anywhere in the world.

How strong is the market of letting guesthouses, where different business models also compete?

There are roughly 8000 flats to let in Budapest via AirBnb. A few large competitors operates them, if I count well, we are in the top ten with our 23 flats.

Is there a bonus system?

Yes, there is. The accommodation fee is for the owner, and in our model, the owner possesses the AirBnb profile, too, and we, who operate the accommodation, have unlimited access to the profile. Our obligation is to fully manage the accommodation, to set the price, to contact, to welcome the guests, to show them the flat, and to arrange cleaning. However, the payment of taxes is the owner’s duty. By the way, 20% of the owners might avoid taxes.

How much bonus do you usually have?

For full-service, we can get even 20-30% , but some extra costs – for example, the cost of cleaning – may appear, and they are not included to the accommodation fee, so the owner and the operator have to agree upon this. Buying detergent and doing the washing may often cost a fortune. Some operators often wash in laundries or do it on their own, other incorporate it in the accommodation fee.

So what the guest sees on the website of AirBnb as cleaning costs is a totally different thing?

This is a marketing tool. The price appearing at first does not include the cleaning costs; it is added to the final sum at the end of the booking process. The guests pay the total amount, but they do not know, of course, how much they pay to the operator as cleaning cost.

How many people do you work with, how many do you need for operating 23 flats?

There are five of us currently, out of which one person works in full-time.

How is work organized and how do schedules work? What technology background do you need?

We are currently using a simple Google calendar.

Where did the idea of founding the association of lessors come from?

Common representatives and the organizations of hotels express their opinion in relation to letting other accommodation. My experience is, however, that there are nearly five thousand lessors without any representative, and this is what we undertook: to represent them.

For example, with a new, risky proposal of not letting new actors entering the market.

This is only one proposal among our eight ones. I understood only afterwards, why it called the attention of the media. We just thought that imposing a moratorium would be worth considering. It is still better than banning or maximizing the days to let.

Which is, then, the most important point of your proposal package?

That the operators shall publicly disclose their contacts

Why this one?

Because this is a strong market, there is no need to limit it, and it is essential that letting a flat shall not depend on the approval of the whole block of flats. In addition, residents’ grumbling can be prevented if they know who to call if any problem arose.

I am sure you are not glad when you see way-out party tourists shouting and dumping their load in the staircase.

This problem is a little bit exaggerated. First, we do not have so many rooms. Those arriving in groups rather look for a hostel. Second, an always quarrelling and shouting neighbour remains an unsolved problem. Or, I could ask: Why letting out a flat depends on the approval of a neighbour? Why a small law firm or a hairdresser saloon is not a problem? It is also nonsense that residents expect tourists to pay higher common costs. Why should they? They do not stay long in the flat, they leave just few litter there.

Owners pay every extra costs, just so as the guests spend their holiday in convenience and in the best circumstances.

ce: bm

Source: Forbes.hu