Scam of Airbnb

With regards to Airbnb, we did try one outside of Singapore, as an owner of a house abroad. The experience has been terrible. We paid 15% management fee to an operator, who promises to fulfill bookings, send cleaners etc.

Since then, occupancy rate has been less than 70%. In order to get 50% more net cashflow compared to Buy to let, we needed over 70% occupancy. The volatility of the occupancy is a lot. In Nov, Jan, Feb it can be as low as 30 - 40%. In Dec when there's a Christmas market, or in Mar, Apr, May and pretty much most of summer it can be over 70%.

However, it brings other problems. We have a big house with a large garden. People tend to book houses for parties. My neighbour told me there were several loud parties held in the house, with one group actually smoking cannabis! The Airbnb operator does not have anyone on the ground to stop these guests because they are based in offices in the city centre and these people who help with things when there's emergencies are actually outsourced!

The wear and tear is outrageous. People from certain countries, mainly third world ones, flush baby wipes down the toilet bowl, constantly choking it. The locals party a lot, burnt the carpets etc. Airbnb reimburse us after we have complained, but if the cleaners are not careful to take pictures of damages, we would lose track of which guests to claim against. How can Airbnb make money when they constantly reimbursing hosts for damages?

Airbnb only works if the operator has someone who actually cares for the house. The various damages etc, needs to be conveyed to the hosts via Whatsapp video and pictures. The maintenance can be a nightmare. Many operators like "Pass the Keys" claim to have good operations, but they outsource the 24 hours helpline for guests to Romania, the cleaners and on the ground operators to an independent company who keeps changing people, and the only people in the city where the house is located are the so-called "relationship managers" who only work during office hours.

A more serious note. Airbnb cannot guarantee fire and safety of the houses offered. It is only a matter of time some hosts put spy cameras in bathrooms and bedrooms to sell explicit videos online. Also, the host is so vulnerable to break-ins. Any of the guests can duplicate keys and break into the house in future. Guests are also known to have taken things out of the house, such as TVs.

Overall, Airbnb is likened to Uber, just a platform that entices guests to look for cheap and spacious accommodation, hosts looking for better cashflow. But the supply of hosts ebbs and flows, so are guests. Guests can easily look for serviced accommodation which ensures more consistent standards and safety. Airbnb is like the scammer that sells shovels to goal prospectors in a gold rush. The only winner is the platform, and maybe the guests. This is likened to Uber or Grab. I will never invest in their IPO at their present business models.