5 ms·

It is probably because travel will take a lot longer to come back than most of us expect. This is because travel is probably one of the prime ways covid-19 can

by babesh 7y ago

It is probably because travel will take a lot longer to come back than most of us expect. This is because travel is probably one of the prime ways covid-19 can start spreading again and governments will be very leery of any activity that will restart the spread. I bet travel will be restricted till there is a vaccine yet no vaccine is in sight. Perhaps in the meantime you will be forced to take a covid-19 test before boarding and when you come back? So you should expect AirBnB to lose virtually all its business till major tourist centers and sources of tourism have stabilized. And you should expect that it won't come close to recovering till there is a vaccine. Then you have to add on that travel is discretionary and given the economic shock, travel will be the first to fall and last to recover. So months to recovering some and then no full recovery till a vaccine is found (> 6 months to year(s)). One good proxy is the Olympics. It's been postponed to July of next year. I bet their burn rate with ~12000 employees is >>1B per year.

TheOtherHobbes 7y ago
I would expect a lot of attrition among their host base even after (if?) tourism recovers, so it's going to take a year at a minimum. In my area former hosts are already switching to the long-term rental market. Which is good IMO, because AirBnB has had a terrible effect on the availability of affordable rentals. In fact AirBnB are reliant on cheap air travel, and that's going to be badly hit. Lufthansa shuttered their budget Germanwings brand today, and a lot of budget carriers will be gone a few months from now. Given a general economic contraction and shake out, I doubt the cheap flights industry is going to recover to anything like its former volumes within 5-10 years.
- onlyrealcuzzo 7y ago
  One of my favorite studies: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3006832 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3006832 > "A 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices." In a lot of markets, AirBNB listings doubled (or more) for years. That could easily account for most of the REAL increases in rents and house prices in those markets.
avalys 7y ago
I disagree with your thesis. When coronavirus was extant only in specific geographic hotspots, limiting travel makes sense. However, when it's present across the entire world at a low level - which seems quite likely to occur within the next month or two - then people traveling between regions is not going to increase the spread that much. Right now it makes sense to tell people to stay in their homes. Once you lift that restriction, whether they're leaving their home to travel 20 miles or 1,000 miles is not that relevant. Travel will be limited only as much as overall economic activity is limited, and there's no way we can maintain the current level of restrictions for the ~18 months it will take for a vaccine to become available.
- babesh 7y ago
  Shoving a bunch of people in a small space for multiple hours to go to other crowded spaces with people from all over the world and then returning home with a bunch of other people in a crowded tube...
- jddj 7y ago
  If the countries are trying to do contact tracing and isolated quarantines where flare-ups are found, it absolutely matters. This is what people are talking about at the moment when they mention easing lockdown restrictions. Imagine a single government trying to get the word out to everyone who may have come into close contact with someone who flies from London to Berlin on a Friday, jumps on a train at the airport, parties for 48 hours, flies home on the Monday and feels ill/gets tested the following Wednesday. Then replace Berlin with "Liverpool" and see how that improves things.
- tonyedgecombe 7y ago
  Tourism in my nearest city (Oxford, UK) had plummeted before any travel restrictions were in place. My guess is it won't come back very quickly after they are lifted.
netsharc 7y ago
But economies reliant on travel will be itching to declare "everything is well, come visit us!". Probably visitors will be wary, especially if they consider whether they'd want to be sick in their destination country.
- TheCoelacanth 7y ago
  Governments that are sources of tourists rather than destinations are going to be less eager to open things up.
  - mattm 7y ago
    And who will want to travel if you know you have to self-isolate for 2 weeks after you return?
sixQuarks 7y ago
Whoa, why do they need 12,000 employees? I'm seriously trying to figure out why they need so many.

by babesh 7y ago

TheOtherHobbes 7y ago

I would expect a lot of attrition among their host base even after (if?) tourism recovers, so it's going to take a year at a minimum. In my area former hosts are already switching to the long-term rental market. Which is good IMO, because AirBnB has had a terrible effect on the availability of affordable rentals. In fact AirBnB are reliant on cheap air travel, and that's going to be badly hit. Lufthansa shuttered their budget Germanwings brand today, and a lot of budget carriers will be gone a few months from now. Given a general economic contraction and shake out, I doubt the cheap flights industry is going to recover to anything like its former volumes within 5-10 years.

onlyrealcuzzo 7y ago
One of my favorite studies: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3006832 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3006832 > "A 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices." In a lot of markets, AirBNB listings doubled (or more) for years. That could easily account for most of the REAL increases in rents and house prices in those markets.

avalys 7y ago

I disagree with your thesis. When coronavirus was extant only in specific geographic hotspots, limiting travel makes sense. However, when it's present across the entire world at a low level - which seems quite likely to occur within the next month or two - then people traveling between regions is not going to increase the spread that much. Right now it makes sense to tell people to stay in their homes. Once you lift that restriction, whether they're leaving their home to travel 20 miles or 1,000 miles is not that relevant. Travel will be limited only as much as overall economic activity is limited, and there's no way we can maintain the current level of restrictions for the ~18 months it will take for a vaccine to become available.

babesh 7y ago
Shoving a bunch of people in a small space for multiple hours to go to other crowded spaces with people from all over the world and then returning home with a bunch of other people in a crowded tube...
jddj 7y ago
If the countries are trying to do contact tracing and isolated quarantines where flare-ups are found, it absolutely matters. This is what people are talking about at the moment when they mention easing lockdown restrictions. Imagine a single government trying to get the word out to everyone who may have come into close contact with someone who flies from London to Berlin on a Friday, jumps on a train at the airport, parties for 48 hours, flies home on the Monday and feels ill/gets tested the following Wednesday. Then replace Berlin with "Liverpool" and see how that improves things.
tonyedgecombe 7y ago
Tourism in my nearest city (Oxford, UK) had plummeted before any travel restrictions were in place. My guess is it won't come back very quickly after they are lifted.

netsharc 7y ago

But economies reliant on travel will be itching to declare "everything is well, come visit us!". Probably visitors will be wary, especially if they consider whether they'd want to be sick in their destination country.

TheCoelacanth 7y ago
Governments that are sources of tourists rather than destinations are going to be less eager to open things up.
- mattm 7y ago
  And who will want to travel if you know you have to self-isolate for 2 weeks after you return?

sixQuarks 7y ago

Whoa, why do they need 12,000 employees? I'm seriously trying to figure out why they need so many.