Homestay operators struggle as guests stay away over coronavirus fears

By Dy Tung   March 26, 2020 | 10:12 pm PT
Homestay operators struggle as guests stay away over coronavirus fears
Motorbike drivers on a deserted street in Hoi An Town, central Quang Nam Province on March 18, 2020. Photo by VnExpress/Xuan Tan.
With increased travel and visa restrictions slashing bookings, the Covid-19 pandemic has hurt homestay operators all over Vietnam.

Minh Tu's Airbnb apartment in District 1, HCMC has received no guest so far this month. "Guests have canceled all their bookings due to coronavirus fears and troubles in acquiring visas."

Last month, Tu’s revenue from the Airbnb listed homestay fell 60 percent from January. He has offered significant discounts, but these have had no impact. Tu now plans to rent the apartment long-term to get through the pandemic crisis.

"If the disease is not contained by the second quarter, I will lose money this year."

Other homestay operators in Vietnam have similar tales of woe to share as tourist destinations close, and Vietnam stops issuing new visas to foreigners starting March 18.

Local airlines have suspended most international flights to limit contagion as the number of confirmed cases in the country reached 153.

The downturn in tourism industry, which is estimated to suffer losses of $7 billion this year, has seen hotels close down and staff retrenched as revenues plummet.

Thanh has been looking for someone to replace her as the tenant for an Airbnb apartment in Hanoi since March 15.

Last month, her three-bed room apartment in downtown Ba Dinh District had an occupancy rate of 80 percent, but the figure has fallen to almost zero this month as Hanoi confirmed a series of new Covid-19 infections.

"I have to pay high rent for this apartment so I cannot bear not having guests. But with people’s incomes falling, finding a new tenant will be challenging."

Vietnam’s homestay market has been booming since 2017 with the number of listings in HCMC reaching over 21,400 last year and in Hanoi, 15,000, according to market research firm AirDNA.

With more competitive prices and flexible lease duration, online booking services like Airbnb are becoming strong competitors to traditional apartment services, a report by Savills Ho Chi Minh City said last year.

However, the rising popularity of homestays has not helped stave off the novel coronavirus crisis.

Nguyen Hanh’s homestay complex in Da Lat, a tourism hotspot in the Central Highlands, barely managed to break even last month. This month, Hanh anticipates losses as 90 percent of guests have canceled their bookings.

If there are no guests, her business could survive for three months at the most, she said.

But Hanh remains optimistic. She plans to rent new premises to open a new complex as prices fall amidst the pandemic.

"Whoever survives this pandemic will have great opportunities as competitors are being filtered out of the market and demand will surge after the disease is contained."

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