The Australian bushfires have destroyed hundreds of homes across the nation and have left thousands of Aussies left to pick up the pieces.
Under these circumstances, the regional market has taken a hit and rent has soared, property experts have noted.
But according to Suburbanite director Anna Porter, there’s one company that could help ease the pressure on the rental market: Airbnb.
Related story: What Australia's bushfires mean for housing affordability
Related story: Airbnb hosts are giving free rooms to bushfire victims
Related story: Why parts of Australia will be unliveable from this year
“The locations that have been the most devastated are areas that often have a high level of Airbnb and other short term rental options,” Porter said. For instance, NSW’s south coast has several high-quality Airbnb accommodation options.
Airbnbs could be transformed into permanent rentals
Airbnb hosts have lost holiday income during this year’s unprecedented bushfire season, with directly- and indirectly-impacted areas seeing a 25 per cent dip in inquiries and bookings over the last few months.
But if Airbnb reduced fees so hosts could drop rates in bushfire-affected areas, both bushfire-affected families and Airbnb hosts stand to gain, according to Porter.
Short-term rentals could be transformed into a longer-term rental for the next 12-18 months to help families stay close to their local community as they rebuild, she continued.
“The challenge will be that the Airbnb hosts need to make the decision to flip the property from short term stays to a permanent rental, which attracts a different style of revenue,” the director said.
But this needs to be done at prices that are in line with market rent, and not at inflated short-term rental costs – and some may be reluctant to do this as it will be a loss of income.
The government should help
The government could also lend a hand by providing grants to Airbnb hosts to make up for the shortfall between normal short-term rental rates and the lowered discount rates for bushfire-impacted locals, according to Porter.
Tax breaks could also be granted to Airbnb hosts offering their properties at lower rates during this period.
“Whilst the fires are not the responsibility of Airbnb hosts, and they too have mortgages to pay and costs to cover, there certainly is an untapped resource here that could become part of the solution if managed in a way that no one loses out,” she said.
Will it work?
Property Investment Professionals of Australia (PIPA) chairman and University of South Australia Business School academic Peter Koulizos told Yahoo Finance it was an “excellent idea” to repurpose Airbnb properties into longer-term rentals.
However, he objected to government incentives and tax breaks, arguing that Airbnb hosts would already be better-off with permanent renters.
“Many Airbnb owners will find that in regards to net income, they will be better off with 52 weeks of long term market rent and the tenant paying most of the expenses such as power, water, internet, etc as compared to 10 weeks of holiday rental where the owner pays all the expenses,” he said.
However, Metropole Property Strategists CEO Michael Yardney said Airbnb hosts were “unlikely” to convert their properties.
“For some, Airbnb, which offers short term accommodation, will be the solution – albeit at the cost of more expensive accomodation,” Yardney said.
“This means it is unlikely owners of Airbnb will convert their accomodation to full time rentals, as they’re likely to find they receive higher short term rentals and increased demand from locals looking for accomodation.”
Airbnb: ‘We are having constructive discussions’
Airbnb’s platform features an Open Homes program, which allows hosts to provide free, temporary accommodation for those who need it who are affected by natural disasters.
As early as November last year, several Airbnb hosts had opened their homes to Australians who had lost their homes to the bushfires.
The program was initially slated to host free rooms until 22 November 2019, but according to a statement by Airbnb, this has now been extended to 31 January 2020.
“Our number one priority continues to be the safety of all impacted hosts and guests and to help ensure the recommendations of local fire authorities are being followed,” Airbnb stated.
“We encourage others who live near affected areas to consider doing the same by visiting the Open Homes page for NSW or Victoria.”
The short-term rental said it recognised that there was a growing need for evacuees to find a place to re-settle in their own communities in the medium term.
“We are having constructive discussions with state authorities about how our host community could facilitate this and at affordable rates,” Airbnb said.
“At present, our focus continues to be on working with emergency services and our hosts to provide immediate support to those in need.”
Make your money work with Yahoo Finance’s daily newsletter. Sign up here and stay on top of the latest money, news and tech news.