Possible 2020 Slump and Airbnb

Ayvio Marketing

23 January 2020

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Possible 2020 Slump

While the US economy is presently firing on all cylinders, there are fears of a potential market slowdown coming in the future. Experts are beginning to fear that 2020 might be the start of a recession. During these times, consumer spending slows down, property prices decline, and expenses, in general, deflate. The consumer, which powers much of the US economy, has less disposable income and, as such, tends to spend less on frivolous things.


A slowdown in the market would have a ripple effect on the Airbnb market, but it wouldn’t be quite like you might expect. Here are three changes that would happen to Airbnb rentals if the market were to slow.


Airbnb Has An Uber-Like Effect: Rentals Might Increase In A Slowdown


Uber has an “inverse” economic trajectory. When the economy is bad, more people are looking to drive, and passengers are looking to save money. One way to save money is by taking an Uber as opposed to paying for the expense of a car. Therefore, when the economy is terrible, Uber can see an increase in business.

The Effect

Airbnb has a similar pattern. When the economy is good, Airbnbs do well because people are looking at them to provide amazing experiences. However, when the economy heads south, people flock to Airbnbs as a cheaper alternative to hotels. Therefore, Airbnb rentals tend to perform similarly, even though the broader economy might be very different.


What will change is how you can attract business. During a downturn, Airbnb rentals that offer great value (like hospitality-level features at a competitive price) will probably see an uptick. Conversely, with a fantastic economy, Airbnb rentals that provide a premium experience are more desirable since people have more disposable income.


The Importance Of Advertising On Multiple Sites Will Increase


When the economy is good, people tend to book things more quickly without comparing prices and offers. In a downturn, people tend to be more money-conscious, which leads to thoughts like “this is what’s on Airbnb, I wonder what’s on Vrbo.” If you own a short-term rental, you’re going to want to be on multiple platforms so you can maximize your exposure.


More People Will Use The Platform


Cash-strapped homeowners will look to Airbnb to supplement expenses and pay the bills. Cash-strapped travelers will look to Airbnb for places that are excellent value. Either way, the competition will increase. The website traffic for Airbnb will likely increase, and you may have to change your ad text to appeal to users’ sense of value.


All In All, Even In A Downturn It Could Be Business As Usual


Even in an economic downturn, it will likely be business as usual with Airbnb. The site will probably see more traffic, and what travelers are looking for will probably change slightly. Other than that, a downturn might have the effect of drawing more people to the site!


Ayvio, a hospitality company, works with partners all across the US to maximize their rental income. We know the Airbnb space well and provide quality hospitality experiences that are sure to please guests, even if a downturn happens!

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