Now Reading: Airbnb supply glut squeezes Indian host returns, rentals rise
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Airbnb supply glut squeezes Indian host returns, rentals rise
Airbnb listings in Indian cities have surged 21-72% year-on-year, driving down average nightly rates by up to 43% in Jodhpur and pushing many hosts towards traditional renting, according to data from tracking…
Airbnb listings in Indian cities have surged 21-72% year-on-year, driving down average nightly rates by up to 43% in Jodhpur and pushing many hosts towards traditional renting, according to data from tracking platform AirDNA. Hosts like Chandigarh-based Harshdeep Kaur, who joined in 2021, said per-night charges dropped to Rs 4,000 from Rs 5,500-6,000 as local listings tripled.
Actress Parul Gulati said she paid Rs 3.1 crore for a Goa villa expecting Rs 40,000 a night but now charges Rs 11,000, earning a yield of 3.3%. Revenue fell 7-14% in Goa, Jaipur, Udaipur, Varanasi and Jodhpur. Experts say hosts increasingly offer monthly deals worth Rs 1.2 lakh to avoid cleaning costs and cancellations, effectively returning to rental-like returns.
Indian Opinion Analysis
The short-term rental boom that followed the pandemic was always going to peak as supply caught up. Traditional rental yields in India have long hovered around 2-4% of property value, and Airbnb's promise of 10-25% returns drew in amateur hosts who now face a market that flipped in two years. The data from AirDNA, which tracks listing and revenue trends, shows that cities which saw the steepest supply jumps also saw the sharpest price drops. For investors, the real test is in operating cost: a property that needs constant cleaning, restocking and price adjustment to stay competitive may yield less net income than a straightforward lease. The RBI's monetary policy transmission, with interest rates still elevated, adds pressure on leveraged owners who took loans expecting Airbnb cash flows to cover EMIs.
Source: livemint.com
This brief was synthesised by AI from the source linked above.
