Hungarian short-term rental hosts on Booking.com face significant payment delays, causing potential business closures. Despite Booking.com attributing delays to system updates, payments have not resumed as initially promised.
Hungary’s short-term rental hosts who offer their properties on Amsterdam-based Booking.com haven’t been paid for several months, leaving some having to decide whether they’ll need to shutter their businesses, according to published reports.
Among the latest developments, regulatory authorities in Hungary initiated a complaint process against Booking, charging that a majority of hosts in the country haven’t been paid money due. Meanwhile, a member of the European Parliament, István Ujhelyi, who sits on its travel and tourism committee, said he discussed the matter with Booking.com, and that short-term rental providers would receive their payments next week, according to Daily News Hungary.
A Booking Holdings spokesperson said last week that the delayed payments had been tied to updates to the company’s payments system, and that providers had been notified that there would be a delay in payments. Press reports indicated that the payment system updates were to take place from July 1 to July 11, and that payments would resume July 24.
However, the lag in payments appears to have been more protracted than previously announced, causing financial hardship for Booking.com’s hosts in Hungary.
We reached out to Booking.com for an update on the situation but didn’t get an immediate answer.
Oahu Suspends Short-Term Rental Restrictions
The Hawaiian island of Oahu suspended its rule that limits short-term rentals to a 30-day minimum in a bid to assist Maui residents displaced by the wildfires, Hawaii News Now reported.
Meanwhile, Airbnb implemented its extenuating circumstances policy for Maui, enabling guests with eligible reservations to cancel their stays and get a full refund. Hosts likewise can cancel stays without incurring any fees.
Sonder the Hotelier
During the pandemic, Sonder, like many of its peers, found itself saddled with plenty of burdensome master leases for multi-family buildings that led to lots of cash burn and hampered its flexibility. Today, the San Francisco-based company’s portfolio is roughly 60% apartment-style properties and 40% hotels, and the company sees the latter as a huge opportunity.
Sonder launched its first hotel collection, Powered by Sonder, a few weeks ago, and CEO Francis Davidson touted the upside of the business model with these independent hotels during its recent earnings call. Among the advantages is Sonder can turn these deals around and begin to operate the properties much quicker than the 2-3 years it often takes to get a multi-family building up and running.
“So Powered by Sonder allows us to operate these hotels, to bring in our technology, to bring in our operations,” Davidson said. “But without having to redesign the whole thing, if it already is really interesting and distinctive and beautiful and has its own identity. And so it’s allowed us to really expand the range of supply that we can take on at really attractive economics.”
You can expect more hotel deals in Sonder’s future.
Coral Springs, Florida Collected $279,000 in Violations on 1 Home
The City of Coral Spring, Florida regularly monitors platforms such as Airbnb and Vrbo to see if they are listing properties that aren’t authorized to be there, and that’s apparently how it eventually collected $279,000 in violations tied to one home.
The home, located at 11033 NW 19 Street, didn’t register as a vacation rental with the city and didn’t have a business tax receipt, and began racking up $1,000 per day fines starting April 15, 2022, according to Tap Into Coral Springs. The property piled up numerous related violations and fees, as well.
Broward County then conducted a tax deed auction when the prior owner didn’t pay the tax bill.
The new owner paid $361,800 for the property in January.
“The new owner paid in excess of the owed taxes, which caused there to be surplus funds held by the county, the spokeswoman explained,” the story said. “As part of the auction, a lienholder can apply to the county to receive a portion of the surplus funds, which is what the city did, and that’s how it collected $279,000.”
After that kind of tax collection, we think plenty of other cities will be monitoring major short-term rental websites on a regular basis if they aren’t already doing so.
Srividya Kalyanaraman writes the Short-term Rental Report. Reach out to her with tips, comments and feedback at [email protected]
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