“We are partners- when your business suffers, our business suffers.”
Airbnb CEO, Brian Chesky, spoke these words to hosts this week as he announced a $260 million Airbnb relief package. This comes a few weeks after the World Health Organization officially labeled the coronavirus outbreak a pandemic. Travel bans, border closings, and mass quarantines were put in place across the world to help contain the spread of the coronavirus. Following this, Airbnb made the decision to allow guests to cancel bookings due to COVID-19 related circumstances. In doing so, guests would receive a full refund or access to other refund options. As a result, Airbnb hosts were left with empty calendars, vacant rental properties and rooms, and no source of income for the foreseeable future.
In an attempt to help cover some of the losses Airbnb hosts are facing due to the coronavirus, Brain Chesky announced a few different relief measures that Airbnb has been working towards, including a $260M Airbnb relief package for hosts.
Airbnb Relief Package for Hosts and SuperHosts
The short-term rental company has put together a $260 million relief package for Airbnb hosts around the world.
$250M Airbnb Coronavirus Fund
Under the new COVID-19 extenuating circumstances policy, Airbnb guests who booked an Airbnb before or on March 14 and have a check-in date between March 14 and May 31 are allowed to cancel. In return, the Airbnb coronavirus cancellation policy would extend to guests a full refund or travel credit. To offer financial support to Airbnb hosts in the face of these cancellations, the company has put together a total of $250 million and from that money, will pay 25% of what a host would normally receive for a cancellation. For any reservations made after March 14, the COVID-19 extenuating circumstances policy will not apply to cancellations. The $250 million Airbnb relief package is coming from the company itself, at no cost to guests.
$10M Airbnb Superhost Grant
An additional $10 million will go towards helping SuperHosts and Experience hosts cover their rent and mortgage payments. In April, these hosts will be eligible for a grant of up to $5000 from Airbnb. This money has been donated by Airbnb employees as well as the 3 co-founders, Brain Chesky, Joe Gebbia, and Nathan Blecharczyk.
Financial Support from Airbnb Guests
Many Airbnb guests are coming together to support the community of hosts who are in need during this time. Because of their desire to provide financial assistance to Airbnb hosts struggling due to the coronavirus, Airbnb plans to facilitate this exchange between guests and hosts in April. From Brian Chesky’s message to Airbnb hosts, he stated:
We are creating a way for guests to send a note along with a contribution to any of the hosts who they’ve previously stayed with. We expect this to go live in April. We know that even a little goes a long way during this challenging time.
CARES Act 2020 and Airbnb Hosts
In addition to the Airbnb relief package, Chesky also announced that the home-sharing company has been working to ensure that Airbnb hosts will have access to financial assistance from the CARES Act 2020. Typically, unemployment benefits are not extended to Airbnb hosts and other gig workers, self-employed individuals, or independent contractors. However, under the coronavirus stimulus package, Airbnb hosts are now eligible for up to 39 weeks of unemployment benefits along with the additional $600 a week for 4 weeks that the stimulus package has introduced for unemployed individuals during COVID-19. Airbnb hosts may also qualify for small business loans and other financial assistance. Learn more about the CARES Act 2020 by reading: How the CARES Act 2020 Will Impact Real Estate.
The Response to the $260M Airbnb Relief Fund
While some hosts are welcoming the Airbnb relief package with open arms, others have already taken their own steps to protect themselves from the loss of income. Airbnb rental properties are being placed on the long-term rental market worldwide and even for sale. Other Airbnb hosts feel that the payout of 25% will not be enough if the situation carries on any longer.
As this is the second move Airbnb has made in response to the coronavirus pandemic amid dealing with their own financial losses, only time will tell how the situation will play out for the company as well as its hosts. Stay up to date by checking out Coronavirus Real Estate Trends.
Sign up now to Mashvisor to stay updated on real estate news around the US. Learn more about the impact of the coronavirus on different US real estate markets:
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