Indianapolis, Indiana has a lot to offer. A finalist for Amazon HQ2 Contestthe Midwest metro has a growing tech and cultural scene, and is now famous for its Cultural trail and recent investments in the renovation of its city centre. The New York Timestypically noted that there is more to the city”than the Memorial Day weekend whirlwind known as the Indy 500which is tantamount to being surprised that New York organizes events other than the annual marathon.
But in a world of cheap airlines and emerging travel destinations, would Indy be your first guess if you were in a rush to name a hot Airbnb market?
Indianapolis, it turns out, has seen “explosive growth” on the platform, according to the first Short Term Rental Index released earlier this month by AirDNA, a company that compiles unofficial data on the short-term rental market. Hosts in the city enjoyed revenue growth of 17.4% year over year, making it one of the fastest growing markets in the country. But why India? And how does Airbnb activity map or correspond to the economic growth and fortunes of a major city?
Dig deeper into AirDNA’s stats, and the growth looks even more remarkable. The number of spaces available for Airbnb short stays in Indy increased by 39% between 2018 and 2019, while occupancy rates increased by 6%. So even with a huge spike in capacity, there is a relatively larger spike in visitors.
“That’s pretty unusual,” says Scott Shatford, founder and CEO of AirDNA. “Normally when supply increases, as it does at Indy, occupancy rates decrease. But this is something of an anomaly. In the 25 major markets in the United States, growth in offer is less than 10% There is certainly an interesting story here.
AirDNA suggested “the high quality of life and booming tech scene” have been the key to attracting so many visitors. Of course, special events, such as Gen Con, a tabletop gaming convention that attracts over 60,000 visitors a year, makes a difference. Each August when the event takes place, short-term rental bookings increase. In May, during Indy 500 race weekend, 4,700 guests have stayed in Airbnbs and generated $700,000 in additional revenue for City hosts, according to Fox 59.
But, as Airbnb itself stated in its 2018 Travel Trends Report, Indianapolis, like other Midwestern cities such as Columbus, Ohio, “is experiencing some of the strongest growth, driven by up-and-coming downtown neighborhoods buzzing with new restaurants, nightlife and local arts. ” Investing in a more livable city really pays off.
According to Visit Indy, the city’s tourist board, Indy saw record number of visitors in recent years, 28.8 million last year alone. Morgan Snyder, senior communications manager for Visit Indy, says alternative accommodations like Airbnb have been key to driving those impressive numbers. Airbnb visitors to the city are up 63% year over year, according to Airbnb’s own statistics, and host revenue is up 76% from a year ago.
“Indy has been very welcoming and supportive of Airbnb,” Snyder says. “Without a doubt, having an option like Airbnb has really helped us accommodate the increase in visitors to Indy.”
It helps that Indiana was open to Airbnb. A 2018 state law prohibits localities from banning the service, and until another law was passed last July, hosts were required to collect taxes themselves, not through the platform. . This has led to confusion, discrepancies and under-reporting of taxes.
“It’s in my contract that I don’t have to (deal with taxes), so why would I?” said Rachel Prince, an Indianapolis-based Airbnb Superhost, told the Indy Star. “There are a lot of gray areas and no one is really sure, so I think the exact procedure was a bit confusing for my clients and me.”
Currently, a number of bills have been submitted to the Statehouse to rectify the situation. State Senator Karen Tallian said she introduced a bill that would simplify the collection of the 7% tax that hotels pay after hearing complaints from the lodging industry that Airbnb hosts would have benefited from tax-funded tourism campaigns.
“It must be, as you know, a big business,” she said. say it Indy Star.
According to Airbnb, hosts in Indiana earned $36 million in additional revenue last year, doubling their income from the previous year. Marion County, which includes the city of Indianapolis, accounted for $14 million of the state total.
Indianapolis, with more lenient laws, many big events, and an evolving downtown, may have all the factors necessary for Airbnb to be successful. Based on the returns this year, it’s a trend that’s here to stay; during the month of August, according to AirDNA, the city’s reserved listings topped 1,694, an all-time high.
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