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The coronavirus crisis is taking some of the air out of platform Airbnb

AFTER quite some time as the disrupter in the holiday letting sector and a viable alternative to long-term rentals, Airbnb is quickly falling out of favour with consumers in the current COVID-19 climate.

Offering higher-than-usual returns and a sometimes lucrative pay-off, Airbnb has been an attractive option for property investors in tourist destinations like Cairns, filling a niche between hotel-style accommodation and traditional leases.

With international travel off the cards, domestic travel extremely limited and local staycations frowned upon, owners are either staying at the home themselves or looking at other options to keep their investment productive.

After flowing in one direction for the past couple of years, we’re now seeing a reversal of fortune as Airbnb hosts move their properties back into long-term rentals, offering more certainty of income as travel dollars dry up.

While the headline figures might not be quite as attractive as before, with interest rates at sustained lows and residential vacancy rates still tight, the Cairns market still offers investors a comparatively high return.

Anecdotally, long-term rentals are still seeing strong interest from tenants and without any significant volume of new supply, we would expect this to remain the case for the moment.

Given the uncertainty that still sits around when we’re likely to see restrictions on travel and social distancing ease, owners can look at either a six-month lease to then review the situation at that point, or take a longer view and seek a tenant looking for a 12-month term.

Should travel take off sooner, owners can prepare for a transition back to shorter-term accommodation if it still fits their needs.

For those who might have only been renting out a portion of their home, either a room or granny flat, there may also be opportunities in the current market to consider longer-term accommodation arrangements. This may be impacted by social distancing, however, both through the application of rules and an abundance of caution on behalf of resident owners.

While there is a need to pivot in this changing market, it’s relieving to know there are still opportunities in Cairns property – they might just look a little different for a while.