Airbnb Changing the Game in Jamaica
Airbnb is making waves in Jamaica. Thanks in part to a growing appetite among travellers— especially millennials— for ‘living like locals’ and the recurring inflow of diaspora tourists.
The last year has seen a 50% increase in the number of hosts actively using the home sharing platform to promote short-term rentals of houses, apartments and even rooms and beds within homes in local communities across the island.
If there is any question whether people are booking, Airbnb reports that 65% of the listings last year hosted guests for at least one night.
A recent case study of peer-to-peer accommodation and the Impact of Airbnb in Jamaica conducted by the World Bank, revealed that Kingston had over 15,000 guests, St. Ann 14,700+ and St. James 13,000+. Across all parishes, listings are popping up on the platform to suit travellers’ varied tastes and budgets.
Island-wide, over 3000 hosts in 2017 welcomed 59,500 guests equating to 186% more visitors via Airbnb than in 2016. Host revenues for 2017 amounted to US$9.4 million, a lift from the US $5.8 million earned in 2016 with 910 hosts in Kingston collectively earning US$2.4 million dollars.
For many hosts, that’s additional funds to help pay off mortgages, school fees and other expenses, seed new business and improve their quality of life.
In fact, Airbnb has reported that globally, 43% of hosting income is used to pay for regular household expenses.
Created in the US during the 2008 economic recession as a means to help people use their homes to supplement their income, the platform has since gained global popularity.
The metrics are simple and done right, it’s a win-win investment.
If you have a property in Jamaica with a US$1200 mortgage for example, securing 20-nights occupancy per month can comfortably pay that off. The key is to cover your fixed and variable costs with room for a markup, yet remain within the range of rates offered by similar listings in your area.
Airbnb's turnkey approach works well in Jamaica for several other reasons.
Its fees are cheaper than similar platforms allowing hosts to retain approximately 97% of the listing price. Compulsory detailed profiles of hosts and guests, professional site photos and legitimate guest reviews make it easy to match expectations and anticipate standards. The back office supports an efficient automated operation that facilitates a smooth online interface for guests and host. And through its global marketing machinery and extensive network, it offers hosts exponential visibility that many small businesses struggle to attain.
The sweet spot of the model is providing superior guests experiences that earn and maintain 5-star guest reviews. This ‘seal of approval’ attracts more guests. More guest stays make a listing stand out in the Airbnb algorithm and unlocks access to increased benefits and tools from Airbnb to boost your business.
“It is the single most important thing to happen to Jamaica in the last 50 years because it makes Jamaica’s tourism market inclusive of everyone from the home side of it to the experiences side and then you take it into the communities and you create sustainable tourism,” Havanah Llewelyn, president of the Jamaica Home Sharing Association told Caribbean Insider, Jamaica.
The association is Airbnb’s first host club in the Caribbean and joins 200+ counterparts worldwide with a mission to “drive initiatives to better their neighbourhoods.”
The association shares best practices among hosts, support community tourism and advocate for fair home sharing legislation. Membership is open to all home sharers whether they list on Airbnb or another platform.
Llewelyn’s sentiment reflects the array of opportunities this level of community tourism affords to ordinary Jamaicans in just about every sector. Single moms, retirees, professionals, the unemployed, anyone with property or extra space in their home can earn directly from the model.
And then there is Airbnb Experiences, another product launched in Jamaica, late 2017.
“Experiences go beyond typical tours and immerse guests into an activity designed and led by a local. It’s an opportunity for a Jamaican to share their hobbies, skills or expertise,” says Sherie Anderson, vice president of the Jamaica host club and host of several experiences and accommodations on the platform.
Everything from farm tours, to street dances, cooking experiences and nature hikes to music lessons in studios can be made an experience from which the community earns, once the proposed experience passes Airbnb vetting standards.
It keeps tourism dollars circulating in local economies
Income opportunities therefore extend beyond accommodations to service providers along the value chain benefitting taxi drivers, shops, housekeepers, entertainment venues, property managers and anyone with a service or product for guests.
The scope for partnerships is extensive. “We are now looking to partner with HEART [Trust NTA] to fill the gap for trained housekeepers for example. There is also an emerging market for individuals to manage property for absentee owners offering short-term rental,” Jamaica’s host club president said.
In a real way, tourism is now filtered outside the typical tourist belts and beyond the traditional players, fulfilling the democratization of travel and tourism that Airbnb purports.
To the benefit of local economies, Airbnb indicated that based on its 2017 global performance, 42% of guest spending happens in the neighbourhood where guests stay and 53% of guests spent the money they saved from staying at an Airbnb in the neighbourhoods and cities they stayed in.
“This model is what transforms a country,” says Llewelyn who is also a returning resident and host of multiple accommodations for himself and others on the site.
“Having home sharing in a community is the best security you can have in a country. When people are coming into a community and spending and supporting that community, they are welcomed. With revenues coming in the community, it lessens the violence and the crime. The community looks out for them and takes care of them to give them the best experiences. In turn, when you have an individual who stays in a community and experiences the true spirit of Jamaica, they become the ambassadors for Jamaica,” he says of what he has observed.
This word of mouth advertising is a huge part of Airbnb’s success and could augur well for restoring Jamaica’s image as a safe place to visit.
In the long term, Llewelyn foresees great potential for many more players in Jamaica.
“When you consider where people are living and staying you’ll find opportunities for housing and accommodations,” he said. To avoid over saturation, he advises, “Look at rural areas where property is inexpensive such as St. Thomas, Negril and Westmoreland for example, and look to develop that area.”
Jamaica was the second Caribbean country to sign a Memorandum of Understanding with Airbnb to collaborate on advancing the tourism sector.