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  1. #1
    Aruba since 1979
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    Andrea J.'s Avatar
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    May 2007
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    Rona's thoughts on AirBNB (copied also to Where to Stay)

    Revisiting AirBnB: A column opposed to discounted AirBnB rates

    According to the AirBnB website there are about 300 properties listed as short-term vacation rentals here, and their average rate is $159 a night.
    Last year I remember, a representative of AirBnB came to the island, and signed a memorandum of understanding with GOA. According to that document, AirBnB was supposed to start collecting the 9.5% government tax and $3 a day environment fee, and handing it over to GOA.
    But so far we nothing happened.
    According to the former MinTour, that legislation, authorizing AirBnB to collect taxes and fees from short-term vacation rentals is ready for introduction, but GOA hasn’t implemented it yet.
    Which is a money losing proposition, because not all landlords comply, they might collect all taxes and fees, but are they handing them over to GOA, every 15th of the month?
    AHATA circulated an interesting read on the subject lately.
    https://www.nytimes.com/2017/04/16/t...rbnb.html?_r=0
    So the hotel industry in the USA is fighting back. Because it is clear that “Airbnb is encroaching on the traditional hotel business.”
    In Aruba too. I went on the website this morning, and short-term vacation rentals are offering ridiculously cheap rates in premium island districts. That’s clearly a mistake because they have no clue how to price themselves.
    On Aruba, AirBnB rentals are operated by moms and pops who want to supplement their income and they really don’t know how to manage their rates to get a decent ROI, without resorting to sharp discounting.
    With sharply discounted rooms all around, according to the article,“ Airbnb has brought hotel pricing down in many places.”
    I think the local hotel industry should fight back by teaching the short-term vacation rental landlords how to price themselves. There is no way of getting rid of them, so teach them better revenue management practices, because with cheaper rates come bargain hunters who won’t spend at restaurants, casinos and shops.
    Our AirBnB community must be taught about the relationship between cheap lodging and budget travelers, and what it does to the economy.
    Local short-term vacation rental landlords should take a page out of Maduro’s handbook and see what happens to an economy where a barrel of oil, or in this case a room, sells for $50 instead of $100.
    Anyway, how can they offer a house for 8 at $80 a night, in view of water, electricity and labor cost??


  2. #2
    Junior Member
    Join Date
    Mar 2017
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    2
    Re "rental landlords how to price themselves. There is no way of getting rid of them, so teach them better revenue management practices, because with cheaper rates come bargain hunters who won’t spend at restaurants, casinos and shops."

    This is ridiculous.

    Actually if they are spending $150 per night rather than $400+.... they have $250+ EXTRA to spend on restaurants/casinos/shops EACH DAY.

    The expense and time to fly to Aruba rather than Florida or Bahamas for example is enough to keep the guests' economic level higher.

    You can argue that it's not fair that hotels have higher regulations and taxes, but if airBNB wasn't competitive it would have already died, especially considering how much establishment blowback there is.

    For the record, I have never used airBNB, but I do use Uber frequently.

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