Airbnb (ABNB stock) has formed partnerships with some of the world’s largest landlords and property management companies to list the apartment complexes that permit renters to offer short-term sublets on the Airbnb website.
The company announced on Wednesday that it would be adding a new page to its website that will list so-called Airbnb-friendly buildings. These buildings will allow tenants to host guests in their apartments as homeowners do.
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The initial share of Airbnb that was traded was priced at $95.86 on Wednesday, November 30th, 2022. This represents a gain of 0.50% when compared to the closing price of $95.38 on NAS on Tuesday, November 29th, 2022. Airbnb has an outstanding share count of 398.25 million, giving the company a market capitalization of $60.40 billion.
In most cases, tenants are not permitted to sublease their apartments for shorter periods of time.
To get things started, Airbnb (NASDAQ:ABNB) is highlighting 175 apartment buildings across more than 25 major markets, some of which include Los Angeles, San Francisco, Atlanta, Dallas, Houston, Denver, Seattle, and Phoenix. Because of regulations imposed by the local government, Airbnb cannot operate in certain cities, including New York City and Washington, District of Columbia.
Tenants will find that the platform makes it easier to host their rentals, and buildings will find it easier to attract tenants who may want to host. The amount of income that tenants could potentially make varies.
Tenants are increasingly looking for ways to supplement their incomes to make their monthly payments because of the significant increase in apartment rents that have occurred over the past few years, as well as the increase in the price of homes and other rising prices. According to Apartment List, rents are beginning to decrease but are still 10% higher than they were a year ago, even though there has been some relief.
Rents increased by over 15% from the previous year in the past year.
A calculator will also be available on the new page that will be added to the website of Airbnb. This calculator will show how much money the tenant can make each month. The calculation shifts depending on the number of bedrooms and the number of nights permitted in each building, in addition to the potential asking rents influenced by the amenities offered by each building.
Additionally, apartment complexes have the ability to charge the primary tenant a fee of up to twenty percent of the total cost of each Airbnb use. According to Airbnb, tenants in those buildings that have been operating in test mode up until this point have hosted an average of nine nights per month, bringing in an average of $900 per month in revenue.
Every host in a participating building needs to be the primary occupant, and the building management has the ability to place limits on the number of nights per month that an apartment can be rented out to guests. That amounts to somewhere between 80 and 120 nights per year, on average. The restrictions, which can be enforced because all transactions take place on the portal, are designed to deter investors from participating and permanently subletting the apartments.
The owner of the apartment building or the management company also has the right to review the listings before they go live and, if necessary, deactivate a listing if it does not meet the building’s standards. They also have the authority to demand a government-issued identification card from any potential subletters.
Equity Residential and UDR, two apartment real estate investment trusts (REITs), as well as Greystar, the largest apartment management company in the United States, are among the prominent names participating in the new Airbnb platform by offering apartments with hosting privileges. Additionally, the apartment REITs Equity Residential and UDR are among the notable names participating in the new Airbnb platform.
Featured Image: Pixabay @ raphaelsilva
