INDIANAPOLIS, Ind. — “100 bucks a night is really a steal for 6 people,” said BNB realtor Rachel Prince as she highlighted of the properties she manages.
Prince has made a business out of short-term rentals, starting rentalpreneur.com. For nearly a decade she’s been managing dozens of Airbnb properties and has been running her business in Indianapolis for the past 3 years. Since last year, that business hasn’t been the same.
“Across the board, all of my clients who have different types of properties from rehab to luxury are losing money right now,” Prince said. “I’d say we’re down 50 percent.”
Prince estimates the number of Airbnbs in Indy has nearly tripled since last year. As the supply outgrows the demand, prices change.
“Prices have been slashed in half because of the competition,” Prince said.
For example, one of her downtown properties that fits roughly 10 people and features a rooftop patio and large luxury loft, would usually be booked for a majority of the month. So far this March, it has just 1 reservation despite a number of events coming to the Circle City.
“This property that used to go for $800 to $900 and used to be booked for 20 percent of the month, is down to 3 nights,” Prince said. “We’re asking for $400 a night and we’re still not booked.”
Prince says those hit the hardest are investors buying properties solely for rentals. After all their costs, the return isn’t what they expected.
“They’re frustrated, they’re concerned, and they’re honestly freaking out a little bit,” Prince said. “They’re not sure if this is a sustainable business model for them.”
However, on the flip side, a drop in prices is a plus for visitors. There’s still plenty of availability offering good prices.