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The average cost of a hotel in the U.S. is about $120 per night. Meanwhile the average cost of renting a room through the peer-to peer property rental service Airbnb is $80. The impact these types of rentals are having on the hotel market in Nebraska is increasing.
Peer-to-peer property rental is a booming industry in the United States. Nebraska has been no different. Airbnb, the largest online hospitality service, is active in more than 65,000 cities and 190 countries. In 2017, Airbnb renters made $4.3 million in Nebraska, compared to $2.5 million the year before -- an increase of 72 percent.
Top 10 Airbnb destinations in Nebraska for 2017
Simon Lovell shows the bed guests sleep on. It's "very comfortable," he says. (Photo by Brandon McDermott, NET News)
Simon Lovell has owned his Omaha home for five years and he’s been renting his guest room on Airbnb for two years.
"When I set my house up to be comfortable for people, it's not because I'm hankering for that reputation," Lovell said. "It’s not because I feel like I should. It's because I feel like I want to and I want them to be comfortable and I want to be happy."
Lovell says setting up an Airbnb account through its smart phone app is pretty straight forward. You take photos, write descriptions of the place you are renting and let renters know what to expect. You can also detail your home, the room available – even information about the bed they will sleep on. Lovell says there is a lot of work that goes into preparing your home for a visit from, for the most part, complete strangers.
"Then I look at my reviews and I'm given such incredible feedback that I'm better than I thought it was," Lovell said. "I'm nervous about whether the house is clean enough, whether it's tidy enough and almost everyone is just delighted."
May is Lovell’s busy season. That’s when Berkshire Hathaway holds its annual meeting. June is a close second, during the College World Series. Renting his house isn’t a “job” to Lovell but it is a well-paying hobby. He rents the room for $49 per night and books a rental about 40 days a year. But the extra income isn’t the only benefit Lovell sees.
"I get the sense of having a roommate, someone to come home to, some company – I mostly live alone – it’s somehow warm to have somebody else in my house," Lovell said.
John Ricks is the executive director at the Nebraska Department of Tourism. He thinks he knows why people are using Airbnb more these days.
"They might be looking to save that little bit of money, sure, (or) they might want to live it up a little bit and stay at a nice Marriott," Ricks said.
But there are exceedingly more hotels in the state than there are peer-to peer property rentals. According to information from Smith Travel Research, Nebraska has 447 hotel properties renting 32,801 rooms. These are properties of 15 rooms or more. The Omaha and surrounding areas have 143 properties renting 15,321 rooms. According to airdna.co, a website that provides data and analytics to vacation rental entrepreneurs, Omaha has 541 active rental properties, Lincoln has 154, Alliance has 52, Scottsbluff has 42 and 33 are in Grand Island.
Mike Vint tells a story of why he picked the furniture he chose. (Photo by Brandon McDermott, NET News)
The Department of Tourism is fully funded by Nebraska’s lodging tax, which is a one percent charge on each night’s stay. In 2016, that amounted to just more than $6 million. Ricks says his department loves tourism of all kinds, but he isn’t sure how much of an impact Airbnb and other services like it are having on the hotel industry.
"It's certainly out there," Ricks said. "It’s certainly popular. I just don't know how it's going to roll out or develop in this marketplace."
While Nebraska requires all hotels to obtain a permit and charge a one percent lodging tax on all proceeds from rentals of accommodations, counties may also impose a lodging tax of up to four percent. Collecting that tax, though, is ultimately on the one renting the room…or in some cases, renting the house.
Mike Vint and his wife bought a house in the Bethany neighborhood of Lincoln in 2013 and decided to fix it up.
"Everything here has a story, everything, every single thing," Vint said. "I don't buy new stuff because America is full of good used stuff."
Vint tried renting the entire property as a residence, but didn’t have any luck, so he turned to another peer to peer service called Vacation Rentals by Owner or VRBO.
VRBO tends to have users who rent out entire properties instead of one room with shared space. Vint and his wife take extra care to let their customers know they are welcome.
"With a card that's handwritten out to our guests it says: Welcome to the Bethany Bungalow! It's our honor to serve you! Call us for anything you need. And we mean anything," Vint said.
He isn’t short on interesting stories of people who’ve stayed at the Bethany Bungalow. Vint isn’t short on where his priorities lie, either.
"I want to love on my people that come here. I love my customers. I want to serve them, because they serve us – they are nice to us – and they take care of our property," Vint said. "We have a lack of that, I think, today – personal care for others – and that's what I want to do. I want to shed the light of him above on others and so that's what I do. This in my gospel – the Gospel according to Mike and Sue."
Vint charges $175 per night to rent his two bedroom house. But, he says he doesn't do it for the money.
"After we paid our insurance, our taxes, our upkeep, our advertising fees, our electricity bills, our water bills, our sewer bills – all that stuff – I made nothing," Vint said. "I just had my taxes done yesterday."
If the current increasing trend for vacation rentals in Nebraska continues, though, the industry may cut into hotel sales. But it has a long way to go. Currently in Nebraska there are about 32,000 hotel rooms available and only 822 active Airbnb listings.