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No more parties in LA. Air BnB announces a permanent ban on parties. According to the news outlet Reuters, Air BnB Inc plan of making a permanent ban on its parties in homes listed on its platform since a sharp drop in reports of unauthorized gathering since the prohibition was put in place in August 2020.
So if you are a traveling and looking for lodging, stay tune because this may change your travel plans.
We will break this down what this means for your vacation plans on this episode of Financial Advisors Say The Darndest Things. Where we provide the latest news and give you feedback from a financial and biblical perspective.
(Intro)
Welcome back I am your host A.B. Ridgeway and this is another episode of Financial Advisors Say The Darndest Things. Well, well, well…for all of you who love to book Air Bnb so you can take pictures for your Instagram and invite all of your friends over for a get-together…well all of that is off the table! No longer can you go to someone else's house and do things that you wouldn’t do on your own.
Initially, back in 2020 the San Francisco-based company introduced and extended the party ban to help stop the spread of COVID-19 infections. Now as the summer starts to heat up, the company wants to make the ban permanent.
I mean if you were a company, wouldn’t you want to reduce your risk. One misconception a lot of people have about financial advisors is that they believe that they all are risk-takers. They see movies like the wolf of wall street and think we are partying on yachts and living our best lives.
That is not the absolute truth. From my own personal experience, true financial advisors are risk managers. Our job is to identify risk and try to reduce it to its lowest common denominator. And that is what Air BnB is trying to do. The more people in a house, the more possible damage, the higher the risk of an insurance claim, and the more risk of someone being hurt.
Due to the recent policy changes according to the article More than 6,600 guests and some hosts were suspended in 2021 for attempting to violate the party ban, the company said.
In May 2022, the company reported revenue was up 70% from the previous year bringing in $1.5 billion in the first quarter of 2022. The company also projected revenue to be above market estimates for the second quarter of the year, expecting to bring in between $2.03 billion and $2.13 billion.
OH MY LORD!
So if you are traveling and hoping to throw a party, I want to let you know that Airbnb is not going for it.
It is the summertime and it is almost the 4th of July holiday so I understand the excitement. But regardless of what you decide to do, make sure you are reading the fine print. You don’t want to violate any rules that are established and risk losing additional assets by having a gathering that is beyond the scope of the initial agreement.
As a financial advisor, one of my main concerns with this policy is the attractiveness of houses and how that will affect the rental rate. Even though according to the numbers are looking on the upside, if the policy is ACTUALLY enforced, which we have failed to see happen, then individuals will not rent larger homes for their vacation needs. So either the company will have to raise rates, or watch its profits dwindle because of this policy.
We will keep a close eye on this because as a traveler, you have every right to be able to utilize the space that you paid for.
Personally, I have used AirBnBs before, in the state of Florida and the experience was great. Now I didn’t throw a party nor am I interested in throwing a party so this policy does not affect me in any form or fashion. But as many travelers are concerned with the cleanliness of hotel room, AirBnBs seem to be a LOW traffic alternative that is not only comfortable but less risk than a traditional hotel. In a random city.
So what does this mean for the investor. There are 2 sides of the coin. As a renter of AirBnb this is great for you because you reduce the risk of your house being trashed by a party and having to invest additional capital into your rental properly.
Also, as a traveler, these types of policies help reduce the risk of having a damaged house upon your arrival or delays do to required home maintenance.
It says in Philippians 4:8- Finally, brothers, whatever is true, whatever is honorable, whatever is just, whatever is pure, whatever is lovely, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things.
If you decide to throw a party in someone else's home, that means that your home was not up to the caliber to throw the party. And if your home is not up to caliber, why do you think it is appropriate to potentially destroy someone else's home.
I think the ban is a great suggestion and will protect many of you who are AirBnB owners. Because to put your home up on the market, is in an investment an this podcast is about protecting your investments.
So if you have more than one primary home, this new policy may work out for you. But if you need help determining if you should put your rental property on the AirBnB market come speak with a Christian Financial Advisor. Because as a person of faith, throwing parties for profit should not be on your radar. I want to applaud this decision.
If you are on vacation, think about using an AirBnb especially if you have multiple families. It can reduce the cost of multiple hotel rooms. We support this decision and if you need help from a Christian Financial Advisor, we would like you to help plan for goals such as taking a family trip.
Discussing time, dates, and amounts that you can spend and still live the life you want.
If you want to read the full article, I will link it in the comments below.
That is it from us, I am A.B. Ridgeway and I’ll see you on the other side of your blessing.
Article link: https://finance.yahoo.com/news/no-more-parties-airbnb-company-120318731.html?fr=sycsrp_catchall
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Meet A.B. Ridgeway:
A.B. Ridgeway, MBA, CPWA®️ (info@abrwealthmanagement.com) is the owner and Christian Financial Advisor with A.B. Ridgeway Wealth Management. With a decade in the finance industry, his goal is to give believers clarity around the most confusing topic in the Bible, money, and tithing. A.B. Ridgeway helps tithing Christians become cheerful givers but unlocking their money-making potential, so they can prosper and be the great stewards of the wealth God has entrusted them with.
*Disclaimer: This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This is strictly for information purposes. We recommend you speak with a professional financial advisor.
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