New opportunities as AirBnB (the Uber of hotel industry) grows in Kenya

Headquartered in San Francisco, US, AirBedandBreakfast (Airbnb) is a global online marketplace and hospitality service accessible via its websites and mobile apps. Members can use the service to arrange or offer lodging, primarily homestays, or tourism experiences.

The company does not own any of the real estate listings, nor does it host events; it acts as a broker, receiving commissions from every booking. Airbnb takes three per cent commission of each booking from hosts and between six and 12 per cent from guests.

Airbnb is growing rapidly in Africa-—with over 130,000 Airbnb listings last year. Over 3.5 million guests have booked on Airbnb across Africa to date, with roughly half of these arrivals occurring last year. Three of the top eight fastest-growing countries in the world for Airbnb guest arrivals are Nigeria, Ghana and Mozambique.

Kenya Association of Hotelkeepers and Caterers executive officer, Coast branch, Sam Ikwaye says Airbnb is as a result of advancement of technology in the hotel industry and has much to offer to the sector.

“Just like any field, the hotel industry finds itself in interesting times because of technology. People can now access places and facilities they couldn’t do so previously. Airbnb has revolutionised the global hotel industry. Hotels are now investing in the same and its aspects of affordability can’t be washed away, “ he told Travelwise.

In Naivasha, George Karimi and his friends often let out their houses via Airbnb. “I was in Nairobi last night and I also used an Airbnb booking to get accommodation at $11 (Sh1,100). A one-bedroomed unit earns Sh2,500 per day,” he says.

The main advantage is affordability, flexibility and freedom for the guests. “You can share a toilet, bathroom and kitchen, but the rates are affordable compared to hotels. Beddings and furniture are provided by the landlord, but you cook your own meals,” he says.

Njenga, a businessman, owns a four-bedroomed unit next to his main house in Naivasha, which he lets at Sh10,000 per day as it can accommodate large groups. He books any extra guests in his friend’s homes. “We have a network of homes in Naivasha doing this. More and more people are taking up Airbnb as landlords and as guests,” he says.

Seth Onyango also lets out his home in Nairobi. He says the business gives everyone a slice of the billion-dollar hotel industry. In case of theft or damage to property, one should report it to Airbnb. “The firm has a two-way review system: one for the host and the other for the guest. Reviews ensure the person you’re hosting or where you’re staying fits the bill as described on the listing page,” he says.

Airbnb withholds taxes when it exceeds a certain amount and remits it to the government, otherwise it wouldn’t be operational in many countries. When a host cancels a booking in a manner that inconveniences the guest, they will be charged and even blacklisted. “Airbnb is much more and sometimes safer compared to hotels as the company takes customer complaints seriously,” adds Onyango.

Guests and landlords say trust is key to a good relationship. Complaints from guests include poor and dirty facilities, homes located far from shopping centres or major road and insufficient or false information from landlords.

Minor complaints (such as utensils lost or broken) are sorted out between guests, but major differences such as vandalism or loss are reported to both police and to Airbnb. “We are paid a month after the guests have left…enough time for us to claim damages if any, and for guests to give their feedback to Airbnb,” he says.

Legality of hosting

Njenga encourages families with extra space not to fear renting them out. “Normally, we work with trust and rarely are guests disrepective,” he says. Some jurisdictions have restrictions on subletting for a short period of time and regulate lodging rental companies such as Airbnb.

Airbnb has published a list of regulations and requirements for cities in the US. Examples of such regulations by jurisdiction, see Lodging Regulation of commercial lodging. The hotel industry, particularly the American Hotel and Lodging Association, has lobbied governments asserting that the hotel industry is subject to unfair competition from Airbnb.