Airbnb combats surge in party houses after clubs shut
When the coronavirus pandemic shut down bars and concert halls in March, a new phenomenon was born: the vacation-rental nightclub.
Professional party promoters started scanning Airbnb, Vrbo and other short-term rental sites for mansions and luxury condos. Tickets were going for $90 on Eventbrite and Tiktok for soirees with bottle service and DJS.
“People were looking to escape from their own homes and came into our tiny neighborhood to party all day, every day,” says Kristen Robinson Doe, a resident of a quiet suburban Dallas neighborhood where a party pad was being rented out for more than $1,000 a night. Doe watched in disbelief as strangers streamed through the gates every weekend and danced until dawn, unmasked, inebriated — and in clear violation of social distancing protocols.
Host Compliance, which gathers data on short-term rental properties in more than 100 cities in the U.S., found a 250% spike in complaints from June to September, compared with the same period last year. Party promoters quickly figured out “they can rent shortterm rentals, create one-night nightclubs and make a lot of money from it,” says Ulrik Binzer, chief executive officer of Host Compliance, which helps municipalities navigate home-sharing rules.
Airbnb and Expedia Group Inc.’s Vrbo have tried to crack down. Despite strict enforcement measures, the companies are struggling to curtail the events. If a listing is banned from Airbnb it can often still be available on Vrbo and other sites, and vice versa. If a host or guest is blacklisted, he or she may rent another property under another name. Some professional party organizers even tell attendees to meet at a public location and ferry them to private homes so the address is never published online. Within half an hour, an empty house on a residential street can turn into a full-blown discotheque.
The spike in rental revelries comes at a bad time for Airbnb in particular. The San Francisco-based startup is planning to go public in December and hopes to raise as much as $3 billion, according to people familiar with its plans. Airbnb had originally intended to list earlier this year but the project was jeopardized after the coronavirus shut down global travel and reservations plummeted. Recently the company has seen bookings return as people seek refuge in rural areas outside of COVID hot spots and settle down for longer stays, taking advantage of flexible work options. The rebound in Airbnb’s fortunes helped get the IPO back on track. But headlines involving police, forbidden parties and a deadly disease aren’t the image the company wanted to project.
Police across the country began fielding calls early in the summer about suburban party-goers terrorizing neighborhoods. Complaints included drunken revelers setting hillsides alight with fireworks and even spitting at neighbors, claiming they had COVID-19.
In response to a spike in complaints, Airbnb bolstered its party-house policy in August, capping occupancy at 16. It also expanded prohibitions on people under 25 from making one-night reservations in the area in which they live. Airbnb uses an automated system to flag potentially problematic reservations for manual review and as a result has been able to identify and proactively cancel almost 9,000 “high-risk reservations” in the U.S. and Canada. Separately, a team of 60 Airbnb agents trained specifically on party house take-downs have suspended more than 380 listings since August, according to Airbnb spokesman Ben Breit.