Despite APTR changes Auckland Airbnb remains profitable

Despite APTR changes Auckland Airbnb remains profitable in Auckland

Last month, the Auckland council looked to bring the rates of Auckland Airbnb hosts in line with that of hotels, motel and serviced apartments. Depending on the location and how many nights per year a property was occupied, some hosts were stunned to discover more than a 225% increase.

This change has undoubtedly upset many in what is quite a sizeable Auckland Airbnb community, however, despite this, the short-term accommodation market in Auckland is still booming and with the right strategy, healthy profits are still very much achievable.

Stefan Nikolic, director of Zodiak, a company who manages Airbnb properties in Auckland believes that we will begin to see the nightly rate of Auckland Airbnb properties increase to supplement this rate increase.

“As with any business, this cost increase will be passed on to the consumer and reflected in an increase in nightly rates on Airbnb”.

However he stresses that, despite this increase, Airbnb will still be able to list at notably cheaper prices than hotels, thus the competitive advantage that Airbnb currently holds over hotel and motels will be maintained.

“Although the price gap will close a bit it will still be cheaper for punters to book with Airbnb, therefore Airbnb will continue to be perceived as the most cost effective option in the eyes of the public”, explains Nikolic.

The Airbnb industry has been booming in Auckland for quite some time, so much so that, even hosts which perhaps did not have the greatest reputation for service and experience could still thrive on the platform.

With these changes not everyone will continue to cash in big and Nikolic expects hosts who position themselves as a high quality, premium accommodation option on the platform to be the ones who will continue to thrive - while the less desirable will drop off.

“As the adage goes, the cream will rise to the top”.

Nikolic’s advice for those who are considering whether they should stick with the short-term accommodation platform is to invest time into better optimising their listings, providing a high level of service and creating an experience which will lead to positive reviews.

“With our clients we are able generate 30 – 40% higher rental income after all expenses. We achieve this through creating a premium hotel-quality experience which leads our listings receiving a high number of return guests and five star reviews - factors which boost the listing up the Airbnb search results pages.”

“Achieving these prime positions will allow you to charge a higher rate and afford you much greater occupancy”.

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