The threat of Airbnb to the hotel industry is nothing new.
Larger hotels and hotel chains are feeling the full brunt of the sharing service in ways nobody could have predicted.
But what is it doing to small hotels and hostels in smaller, more remote areas?
Well, as it turns out, it’s absolutely devastating businesses.
Case in point?
A short-term accommodation provider in regional Victoria run by Mohya Davies which has had to shut up shop thanks to a lack of clientele.
The YHA backpackers hostel and apartments in Foster, which has been running for 15 years, will be closing indefinitely tomorrow as Davies and her husband are unable to cope with the rise in holiday renting in the area.
Speaking to Travel Weekly, Davies – who is no longer affiliated with YHA – said that while Airbnb has been great for the consumer, it has completely ruined her hostels’ popularity.
“There are now 10 or 15 more options in Forster, which is great for the consumer, there’s a lot of choice for them.”
“Although,” she adds, “it also means that our business has become marginalised.”
According to Davies, the Airbnb takeover has been recent.
“Slowly over the last two years and then we went to the YHA conference and realised it wasn’t just us its everyone.”
“In Phillip Island, there are 500 Airbnb beds, it’s really just turned into an economic decision for us,” Davies added.
Making a comment on the rise of Airbnb accommodation in Australia, YHA CEO Julian Ledger said the concern is namely three things.
“The impact of tourists staying in non-approved accommodation, affecting residents and so giving tourism a bad reputation.”
“Accommodation being used as tourist accommodation which is not compliant or fit for purpose.”
“Cheaper alternatives undermining the viability of approved operators.”
According to Ledger: “These problems have been particular to the CBDs, inner suburbs and beachside suburbs as well as certain locations in regional areas such as Byron Bay. ”
“From the 1980s, it was mainly the problem of illegal backpacker hostels operating out of former boarding houses and larger private residences.
“In more recent times, the problem has been exacerbated by the emergence of online letting platforms.”
“Whilst these do incorporate some checks and balances into their business model the sheer number of new holiday lets has increased the impact.
Back in November, Travel Weekly questioned whether Airbnb had reached its tipping point, as industry experts predicted the sharing site would fail to gain more users than it has already acquired.
In its third AlphaWise survey, Morgan Stanley found the popularity of the home sharing start up may be waning, with Airbnb use in consumers growing by only 3.3 per cent in 2017.
While the numbers are still promising for Airbnb, and counting in the fact that only around two-thirds of global consumers were surveyed, the industry speculates the service is plateauing.
However, even if the platform is indeed slowing down, the devastating effects it is having on small businesses such as Davies’ hostel will only continue.