Some Airbnbs are topping US$6,000 a night in World Cup housing frenzy
The fervour is reshaping the lodging market in match cities across the United States
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[NEW YORK] The biggest winners from this year’s World Cup are poised to be those able to rent out their properties, especially in the tri-state area.
Bobby Roufaeal, who manages more than a dozen short-term rentals in New Jersey, said a luxury rental in the state could bring in US$240,000 between Jun 11 and Jul 19 when the tournament runs. He said he is trebling rates for his units in anticipation of fan inflow for the games and fielding calls from homeowners looking to capitalise on demand.
“They’re like, listen, I’ll figure it out. I’ll go stay with my relatives for the month or for a few weeks just to be able to capitalise on this revenue,” said Roufaeal, founder of Settled In Property Management.
Already, listings show a surge in prices. One six-bedroom Airbnb property in Princeton, New Jersey, is offered at roughly US$6,000 a night during the World Cup, about 140 per cent higher than its price a year ago. That is despite being more than an hour’s drive from the games being played at MetLife Stadium.
The fervour is reshaping the lodging market in World Cup cities across the US, which are expecting millions of visitors throughout the course of the tournament. Matches are also being held in Mexico and Canada.
“Big events like the Fifa World Cup create meaningful economic opportunities for local hosts, many of whom use the extra income to offset the rising cost of living,” Airbnb said in an e-mailed statement.
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“At the same time, guests still have a wide range of listing options to choose from; as at late February, roughly 80 per cent of available listings across host cities were priced under US$500 a night on average.”
For those renting out their homes, it can be a lucrative prospect, especially as Airbnb has offered as much as US$750 in cash for first-timers to incentivise new listings.
For travellers, the cost of attendance adds up as prices surge for tickets, hotel rooms and flights. The tourism boom is expected to lift hotel rates in the host cities by an average of 300 per cent around opening matches, the New York Times has reported.
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Those expenses are causing Mehdi Salem, the founder of French football fan association Les Baroudeurs du Sport, to find ways to save money as he organises accommodations for 80 of his members to see France play at MetLife.
He is squeezing eight people in a room designed for four, and booked hotels in Manhattan more than a year before the games, when prices were lower. Now, he is looking at spaces in New York City’s outer boroughs, including the Bronx and Queens, as well as Airbnbs in less-travelled New Jersey neighbourhoods.
“Some prices are totally ridiculous,” Salem said.
Montclair, New Jersey, a well-off suburb, has seen a 169 per cent increase in short-term rental occupancy during the group stage compared to the same dates last year, according to data as at Mar 26 from analytics platform AirDNA, which tracks rental demand, rates, and occupancy across host cities.
The nearby towns of Clifton, Newark, Paterson and Jersey City have also seen surges, the data showed.
Jamie Lane, chief economist at AirDNA, said that as the games grow closer, prices are poised to increase.
“When bookings start, people typically aren’t booking the properties that are priced really high,” he said. “Other properties that are more reasonably priced do get booked, and then we see the delta between the available rates and the booked rates begin to merge.”
Attending the World Cup will be expensive for any spectator, especially those travelling from abroad. Ticket prices can range wildly, in part due to the implementation of Fifa’s dynamic-pricing strategy which raises rates depending on demand.
Initially, tickets started at US$60 and could be as much as US$6,730 – though those increased in subsequent batches. The numbers are even larger on the secondary market, with those for the coveted Jul 19 final starting at around US$8,000 and topping US$50,000, according to listings on resale site StubHub.
Salem, the French organiser, said that many of his members are staying home because of the high costs. “Globally, people are complaining about the prices and we lost many, many good followers and good fans are not coming because of the prices,” he said.
Some fans are looking outside of the major hubs to smaller host cities that can be more affordable. Data from Expedia showed searches rising most sharply in secondary markets, such as Kansas City, Dallas and Houston. Lodging prices outside the US, in Canada and Mexico, remain the most affordable.
“If you look to the smaller towns, you can have venues that are more easily accessible,” said Michael Seiler, professor of real estate and finance at the College of William & Mary.
Houston tourism officials say the pace of hotel bookings for June and July is already running more than double last year’s levels across major submarkets. In Dallas – which is hosting more matches than any other US city – searches for housing options are up 230 per cent from last summer, according to Expedia data from January.
“Dallas is no stranger to major sporting events, but this isn’t simply another big event,” said Zane Harrington, a spokesperson for the city’s tourism bureau. “The Fifa World Cup is unlike anything we’ve experienced before.”
Michael De Micco won World Cup tickets for a game at Gillette Stadium in Foxborough, Massachusetts, through his employer, Frito-Lay. He plans to drive about nine hours from his home near Pittsburgh and has already ruled out hotels as too expensive.
Instead, he considered Airbnb and Vrbo rentals in Providence, Rhode Island, after seeing a listing near the stadium that was out of his budget.
“There’s no way am I spending a thousand dollars a night,” he said.
Real-estate investor Geoff Colleran is on the other side of the equation, listing his home in Foxborough for more than US$2,000 a night. He said he hopes to use the profits to pad out his investments and pay off some debt.
“I would be extremely disappointed if that entire portion of time from mid-June through July isn’t booked,” said Colleran. “On a typical summer, we do US$50,000 to US$60,000. So I’d expect a six-figure summer.” BLOOMBERG
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