Rooms for rent: Tri-City homes boost Airbnb rural trend

Shawna Holland stayed in an Airbnb rental while traveling and loved it.

Still, when her husband John suggested they list their Richland basement for rent on Airbnb, she was wary. Actually, she thought he was crazy.

Who, she wondered, would visit the Tri-Cities or pay to stay in their house?

John prevailed. Their custom-built home would make for a compelling Airbnb offering, he argued.

The Hollands are the new, increasingly rural, face of Airbnb and its “sharing economy” peers, internet-based services that allow people use their homes and vehicles to earn money.

Their picturesque house sits on two and a half manicured acres near Dallas Road in Richland, overlooking the Tri-Cities.

They’d designed their home with a daylight basement when their two children were young, imagining their son and daughter would take over the space when they hit their teens. That didn’t happen and it went unused.

In San Francisco-based Airbnb, John spied an opportunity to let the internet platform help them monetize their basement and fund the family’s financial goals, like paying for college and early retirement.

Airbnb launched in an urban area, but rural America is the fastest-growing segment of its business, according to a report it released last week, “Beyond cities: How Airbnb supports rural America’s revitalization.”

The report is based on Airbnb data, dividing communities into “rural” and “urban” based on U.S. Census Bureau definitions.

Airbnb says its rural listings have grown by 1,800 percent since 2012 — almost 40 percent more than its urban growth. The average income across all hosts is comparable, hovering at about $7,000 annually.

Washington’s 2,100 rural hosts represent 24 percent of Airbnb’s total listings in the state. They welcomed 148,000 guests during the 12 months that ended in February. That’s 88 percent more than the year before.

The average take-home for rural hosts in Washington is about $7,200 a year, making Washington a Top 10 state for host income.

“(W)e believe home sharing can help rural communities benefit directly from the tourism boom, rather than keeping the growing profits in the hands of corporate hotel chains...” the report said.

It’s unclear exactly how many hosts operate in the Tri-Cities since some sign up for multiple cities. But Kennewick is the apparent home to 76 hosts, Richland to 86, Pasco to 77, West Richland to 85, Prosser to 91 and Benton City to 49.

Mixing business with pleasure

To prepare for Airbnb, the Hollands completed the basement and furnished it as a two-bedroom suite with a private bathroom, limited kitchen and comfortable living room. It sleeps six or more and opens to a patio and private pool with hot tub.

“Holland House Wine Country Bungalow” went live on Airbnb last June and currently rents for $115 a night. Taxes and Airbnb fees push the total closer to $150.

Shawna was pleasantly surprised by the immediate flow of bookings, now running at 98 percent. An early guest booked a 38-day stay. Not long after, the couple declined a 90-day stay. They wanted guests, not a semi-permanent housemate.

“We’d rather have an occasional guest,” John said.

The rental income helps pay their daughter’s tuition at the University of Idaho, and other expenses, including the pool and saving for the future.

“This could move me toward retirement early,” said John, 51, who works at Energy Northwest as an instrument technician.

And Shawna, who stayed home to raise and educate the kids, expected to seek outside work as they grew more independent. Airbnb is her job now. She spends about 20 hours cleaning the rental unit and keeping the gardens in picture-perfect condition.

The downsides are minimal but real.

Their insurance premiums doubled when they took out an umbrella policy to augment coverage provided through Airbnb fees. They needed a larger washer and drier for the added laundry and had to learn to live quietly in their own living space upstairs.

“We have become very good at walking softly, ” Shawna said.

Airbnb added another income stream to their income taxes, but the couple note their return was already complicated. Both are artists who sell their work and John manages rentals for his father.

Airbnb sends an IRS Form 1099 documenting their income. John tracks expenses on Quicken . At tax time, everything is at his fingertips, he said.

Sharing economy discovers the Tri-Cities

In 2016, Uber, another San Francisco company in the sharing economy market, landed in the Tri-Cities after difficult negotiations with local cities over background checks for drivers and business licenses. The ride-hailing service is now authorized everywhere but Pasco, where talks stalled over fingerprint checks for drivers.

Locally, cities are less aggressive about in-home rentals through Airbnb and the similar services such as VRBO, treating them as largely private matters akin to roommates or bed and breakfasts.

That is changing. Spokane passed regulations on short-term rentals in 2015. Seattle, concerned that affordable housing was being converted to short-term rentals, considered rules to limit home sharing. In Walla Walla, the city considered regulations to protect neighbors.

The hospitality industry is watching Airbnb and its peers with interest but to date have not actively objected to the rising number of private offerings.

Kris Watkins, president of Visit Tri-Cities, said home-based rentals aren’t in the industry’s face.

Still, she said hotels are more heavily regulated, pay not only sales taxes, but a hotel motel tax and are building the tourism infrastructure that attracts visitors.

Hoteliers have invested heavily in the Tri-Cities in recent years. Between 2014 and 2016, the market grew by 20 percent to 3,989 rooms, a rate that outpaced demand and forced hoteliers to get creative about preserving market share.

The Washington Hospitality Association makes a similar argument. Lack of regulation can compromise the safety of visitors and hosts.

“You may not know who is there,” said spokeswoman Stephanie McManus.

The Hollands say their guests have been tourists in the Tri-Cities for wine ad sports events, as well as drivers breaking up the trip between Seattle and Boise.

Shawna painted a map of the globe to mark where the guests come from. The family generally takes a hands-off approach with guests but will mingle if it appears welcome.

“We’ve had fabulous guests,” Shawna said.

This story was originally published July 1, 2017 at 2:45 PM with the headline "Rooms for rent: Tri-City homes boost Airbnb rural trend."