Is your Short Term Rental affected by COVID-19, too?

So COVID-19 happened – now what?

At the start of 2020, everything was on track with our short-term rental business. Our 15 properties were full for the spring cherry blossom season in Tokyo and occupancy was healthy leading up to the Olympics. I was even adding new properties to cover Olympics demand. Our cash flow projections were good and 2020 was going to be our year. 

After 8 years in the business, my husband and I had plans to build our savings on the tourism high of the Olympics and then reduce our property management portfolio and diversify. We were confident and excited for the year ahead.

By the end of January, something was amiss. A ripple. By mid February it was surging, by early March it was a tsunami of horror. My healthy booking calendar and cash flow were being sucked out to sea. 

I tried to keep it together, I was in denial, I was raging against the injustice of it all. Why us, why now? NO NO NO NO!! I really didn’t want to believe any of it. 

Most of March was spent in a rollercoaster of emotions and panic. Firstly, I was worried about our current short term pain like paying bills, then panic about longer term issues like retaining our five employees and keeping things afloat until the now-postponed Olympics. We were so exposed and so vulnerable after we had felt so confident as to the health of our industry and our business plan. 

Then came the acceptance. When I pulled my head out of my own woe, I could see the horror of this human tragedy in its true form across the globe. From this perspective our own financial concerns seemed so small and petty. So many people were sick and dying, all ages, all races, all nationalities. This was a human nightmare with an invisible and non-human foe. 

For me, I have adopted a stance of “It is only money. I have my health, my brain and my talents. I have built successful businesses, I can always build more.” 

The irony is that in 2019, I had started a consulting business in order to help other hosts hone their hosting business and increase profits and their own enjoyment of hosting. My plan was to ramp this up over 2020 and have this in a great position as we scaled back the number of houses so that I could focus on the teaching, the consulting, building a community of hosts that I could help, mentor and support. 

So for the last few weeks, I have really dug deep to try to brainstorm how I can help other hosts who are on this same journey right now. Previously, scarcity wasn’t a variable that I considered in this business. Tourism was booming and all the indicators were positive and strong. 

Nobody saw this coming and nobody was prepared. This pandemic has derailed not only my business and my short term plans, but many others can tell similar stories. Other hosts, tour operators, airlines, hotels, restaurants, we are all affected or know people who are. 

Reacting to the new normal

As hosts, what have we done? Well we have dropped our prices right down to cost and below – just trying to mitigate losses. Currently we are hosting a few Japanese nationals who returned to Japan and needed a shelter in place for isolation now they find themselves stranded. 

We are also actively looking for ways we can support our local community. We have started a Staycation campaign on the socials. Additionally, we are working with other local hosts to lobby the various health departments and government departments to offer safe places for people needing quarantine or remote working venues. 

Marketing at this time must be different. This is not the time for sales talk, this is the time to acknowledge the situation and explain in transparent detail how we are approaching things from our guests perspective and the health and safety of our staff. 

For other hosts who find themselves in this situation, I am with you, I feel your pain, I fear the same fears. I understand the paralysis of uncertainty. However, this will pass and now is the time to start planning for a new post pandemic future. 

Tracey Northcott – the consultant

I wear two hats – my host hat at Tokyo Family Stays and my consultant hat at Tracey Northcott Consulting. 

If you are also experiencing a collapse of your previous business trajectory, I don’t pretend to have the magic wand that will make it all better. What I can do is give you some things to think about in how to move forward and move forward you must. From personal experience, it is much better for your mental health, if you start to think critically and analyze your situation. 

If you are a host of short term or vacation rentals, here are some things to consider:

• Do you have enough savings to carry you over the next few months? If not, then you must take some action now. Consider closing down some listings. 
• Are you eligible for a small business bailout loan?
• If you are renting, can you speak to your landlords to seek rent reduction?
• Is short term rental prohibited right now in your area?  
• Can you convert to long term rentals?
• Can you look at offering low cost or free accommodation to medical workers who are on the front lines fighting for all of us?
• Can you speak to your local government about offering shelter in place options or quarantine options?
• What about local businesses who need remote working options? Or for essential service staff to have a residence closer to their workplaces to avoid the need for public transport?

Put the downtime to good use

If you have enough savings to see you through or your landlords have been helpful to delay rent, now is a great time to renovate, deep clean, upcycle some furniture. Taking action will lift your spirits and give you some purpose. 

Here are some actions you can take while we are all in limbo and the listings are empty. 

• Don’t leave your listing closed up – open up the windows, let fresh air through.
• Take out all your linens and air them. Give them a sun bath. There is nothing fresher than allowing your linens to air in the sunshine – no chemical cleaner can do better than the sun and fresh air. 
• Move your furniture around – get those dust bunnies from behind furniture, behind appliances. 
• Pull out everything from the kitchen cupboards and wipe down all surfaces. 
• Clean out the magazine rack and edit tourist pamphlets. 
• Reprint your welcome book or house compendium.
• Take your rugs outside and clean them. Beat them old style to get out some frustrations and a good cardio workout.
• Wipe down all the surfaces that might get missed on a normal clean – door handles, light switches, curtain rails, light fittings. 
• After cleaning, give everything a spray with alcohol or another disinfectant.  
• Follow the Airbnb and CDC guidelines for additional cleaning and sanitizing.

Something else to consider

Now is also the time to build your own website for direct bookings. Work on your branding and plan out a social calendar for the future. If you need help with this, get in touch. 

If you like the Tokyo Family Stays website, this was built on Lodgify. This is an excellent program for quickly starting your own booking website and then there are professional tools if you want to expand functionality.

Look at your listing copy, refresh your wordings, photos and generally update your on-line presence for the new normal.

Get all your ducks in a row for when things are back up and running so you can just press the button when things are starting to move again. This time will pass so when things start to improve you can be ahead of the curve. Short term rentals will be the first to bounce back – as people move about domestically and then internationally. 

I just want to leave you with one last thought. 

When everything feels low and sad, pull out your guest book and read your reviews of your wonderful past guests. They will remind you that you are a great host and it is worth looking forward to getting back up and running again.