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INDIANAPOLIS, Ind. – “$100 a night is really a bargain for 6 people,” said BNB real estate agent Rachel Prince, highlighting the properties she manages.
Prince did a short-term rental business, starting locationpreneur.com. For nearly a decade, she has managed dozens of Airbnb properties and has run her business in Indianapolis for 3 years. Since last year, this business is no longer the same.
“Overall, all of my clients who have different types of properties, from rehab to luxury, are losing money right now,” Prince said. “I would say we are down 50%.”
Prince estimates that the number of Airbnbs in Indy has almost tripled since last year. As supply exceeds demand, prices change.
“Prices have been cut in half because of competition,” Prince said.
For example, one of his downtown properties that sleeps around 10 people and has a rooftop terrace and a large luxury loft would typically be booked for the majority of the month. So far in March there is only one reservation despite a number of upcoming events in Circle City.
“This property that used to be $800-900 and was booked 20% of the month is down to 3 nights,” Prince said. “We’re asking $400 a night and we still haven’t booked.”
Prince says those hardest hit are investors who buy properties just to let. After all their costs, the return is not what they expected.
“They’re frustrated, they’re worried, and honestly, they’re freaking out a bit,” Prince said. “They don’t know if this is a sustainable business model for them.”
However, on the other hand, lower prices are a plus for visitors. There is still plenty of availability offering good prices.
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