Bosses at a Blackwall-based Airbnb management firm say their business isn’t bad for the rental market.
SmartHost was launched by Serg Ivo and two friends in mid-November as an alternative way for property owners to make money.
He said the majority of its clients are jet set business people who don’t want their homes to sit empty when they are away on short trips.
“We are the only option for them as most rental contracts are for a minimum of six months,” said Serg.
“I’m positive we don’t compete with letting agents because people who want to do a long term let will still go to them.”
Following concerns about the impact on the rental market, Airbnb brought in “pre-emptive” rules on Thursday, December 1, capping home sharing at 90 days unless property owners had council permission for longer.
Serg, who is marketing manager for the firm basedat Horizons Tower next to Blackwall Station, said the firm had been told Tower Hamlets Council would either issue them with a licence or individual property owners would get them.
“The whole situation is still uncertain but we have been told there is a way forward,” he said. “They just want to restrict it in some way.
“The property market in London is booming and there is room for everyone.
“Maybe in smaller towns there would be an effect but here, they don’t affect each other because of the size of the property industry.”
He and his fellow founders had the idea for SmartHost after meeting while working in the London nightlife industry and becoming disillusioned with rental properties.
Serg said: “We are Russian but have been living here a while and had our own properties that we have rented out with agencies.
“But we thought their fees were too high so we started to manage them through Airbnb and saw how profitable and easy it was, it really is revolutionary.”
They spread the word to friends and soon realised there was a gap in the market for a management company that catered to high-flying business people.
Serg said: “A lot of our clients are bankers who travel a lot for work for a week at a time and while they are away we fill their property and make them money.
“There is a real growing market for it. We started out with just six properties, some of them our own and already have 20. We are seeing new ones every day.”
The firm mainly caters for luxury apartments in areas such as Knightsbridge and Kensington but is looking for Canary Wharf and east London apartments for its portfolio.
“This area is very attractive to tourists because of Greenwich, The O2 and the DLR,” said Serg.
SmartHost takes 11% to 16% of the net rental income each month and clients get advice on how to make their property more desirable for Airbnb customers, such as adding a fold-out bed in the lounge. It also takes photographs of all the rooms to help owners market their property.
It will send a professional team to clean before and after guests arrive and will prepare a tailored welcome pack with guides to the local area and small gifts such as cheese and biscuits.
Serg said because Airbnb relied heavily on customer reviews, services such as these could help boost a property’s reputation and therefore its income.
A three-bedroom home in W1 can make £300 a day and SmartHost head of sales and operations Darius Smith said despite the new rules there would still be plenty of scope for clients to make money as it only required properties on its books to be available for a minimum of ten weeks per year.
Changes to the rules
In 2015 Airbnb launched the Community Compact that included a commitment to work with cities that had identified a shortage of long-term rental housing as a critical issue.
On Thursday, December 1, it announced automated limits to help ensure entire home listings in London were not shared for more than 90 days, unless hosts confirmed they had the required permission to share their space more frequently.
The move came after six months of work with partners across the capital including council officials, members of the public and Airbnb hosts.
It also asked the Institute of Public Policy Research (IPPR)to look at the impact of home sharing on London using Airbnb data.
It concluded the housing crisis was the result of a failure to build enough homes but that pre-emptive action was recommended to ensure sharing of entire homes did not have a negative effect in future.
In a statement Airbnb said: “London is a world leader for the sharing economy, has long supported the right of regular people to share their homes and has introduced clear home sharing rules.
“We know the vast majority of Airbnb hosts in London are regular people who share their homes to help them afford one of the most expensive cities in the world.
“The typical Airbnb host in London earns £3,500 by sharing their space for 50 nights a year and the Airbnb community generated an economic impact of more than £1.3 billion in London last year.
“We firmly believe this step will help build a better London for everyone and work is already underway to implement these measures, which will be in place by spring 2017.
“We want to be good partners to London and continue to lead our industry on this matter, and ensure home sharing grows responsibly and sustainably.”
Mayor Sir Steve Bullock, London Councils’ executive member for housing, welcomed the news and said: “There are currently nearly 50,000 properties listed on Airbnb in London and around 57,000 empty homes.
“Ensuring short-term rentals advertised with all providers are being used in line with planning laws is a vital step in tackling a housing crisis that impacts on all Londoners.”
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