Have you ever booked an Airbnb in an apartment building where the host told you to pretend you are her cousin to avoid scrutiny from a disapproving landlord or neighbors?
In 2022, Airbnb sought to get around that pain point with the launch of Airbnb-friendly Apartments, which gives renters the flexibility to earn extra income when they are away – with landlord approval.
Airbnb announced recently that it is expanding the program from the U.S. to the UK in partnership with Greystar. Separately, Airbnb also debuted Airbnb-friendly Condos in Florida.
Airbnb-Friendly Apartments counts 750 buildings with more than 200,000 units in the U.S. In the third quarter, more than 2,000 renters participated in the program, according to Airbnb. In the past two years, hosts in these building took in more than $14 million.
An Underwhelming Participation Number
It turns out that those 2,000 renters amount to an underwhelming 2.66 participating renters per multifamily building.
“It’s a low number right now, to be honest, because we are just rolling out buildings, and like all things, it takes time to get renter adoption,” Jesse Stein, Airbnb’s global head of real estate, told Skift last week.
Stein said Airbnb launched the program in about 200 buildings in the last quarter, and landlords need to make renters aware of the program.
“It’s not like you’re opening a hotel and you have 365 nights of calendar availability on day one,” Stein said.
Before the debut of the program, many landlords were hesitant to let their tenants host. Now, those who participate get to market their properties on Airbnb at no charge and have transparency about short-term rental activity in their buildings. And they earn a 10-25% revenue share from Airbnb, Stein said.
With more renters becoming aware that they can put their units on Airbnb with the landlord’s blessing, Airbnb is “now focused on the last mile, like getting people across the goal line,” Stein said.
Among the hurdles is informing tenants how they can safeguard their personal possessions, which varies from building to building, while they are away, he added.
Not For Arbitrage
In the UK, Airbnb is bringing the program to Greystar buildings on Canary Wharf, as well as in East and West London.
“Eighty percent of UK renters are looking for a way to make supplemental income, and 55% are open to home sharing,” Stein said. “What better way to do it? So it’s pretty exciting.”
Stein said Airbnb has controls in place to ensure that hosts are primary residents of the building. “The goal of this is not to have people arbitrage and make a profit,” he said. “The goal of this is to help people make some supplementary income to keep up with the cost of living.”
On average, hosts in the program book guests on Airbnb for about 40 nights per year, Stein said.
Condos, Too
Airbnb began piloting Airbnb-friendly Condos in 2021, and officially launched the program last week. Partners include PMG, Related Group, and GFO Investments, all with Airbnb-ready buildings under construction in Miami.
Airbnb plans to expand the program to Latin America in 2025.
Stein said one reason developers like the concept is because the program attracts more buyers when home owners associations permit short-term renters of 30 days or less.
Unlike for renters in Airbnb-friendly Apartments, hosts in Airbnb-friendly Condos own the units, and these are not necessarily their primary homes.
The condo program is a different business model than the apartments program; there is no revenue share with the homeowners association because the hosts own their units. “The homeowners association now has that kind of visibility to ensure that the condo unit owners are operating in accordance with the condominium documents,” Stein said.
Here’s Jesse Stein speaking about Airbnb-friendly apartments in 2023 at the Skift Short-Term Rental Summit:
