Airbnb situation in Malaysia, what to observe before jumping on the staycation bandwagon!

More than 60% of new Airbnb hosts in Malaysia in the first half of 2021 (1H21) comprised millennials aged between 25 and 40. The top five states for staycation are most notably Selangor, Kuala Lumpur, Johor, Sabah and Penang. Amid the perpetual MCOs, new Airbnb hosts collectively earned over RM680,000 from welcoming guests via the online platform. As a key source of revenue for households and businesses, the income generated help them stay afloat in battling tough times during the pandemic. Hosting has also offered many a lifeline in alleviating their economic & financial woes or constraints.

The popular vacation rental platform allows owners to rent out their properties to guests, while guests enjoy a unique accommodation experience. Owing to the prolonged travel restrictions, staycations such as Airbnb are temporarily put on hold until state borders are reopened for domestic tourism. But sooner rather than later, the tourism industry (especially Airbnb) shall bounce back as interstate travel is eventually allowed. As more people choose to work from home amid the lockdown, they are also looking for places to stay.

Although Airbnb is perfectly legal in Malaysia, they remain largely unregulated by the government. With no federal laws in place to provide clear-cut guidelines on restrictions, local state governments have entrusted themselves to regulate Airbnbs within their respective territories. Airbnb hosts are also required to apply and seek approval from relevant authorities such as the local municipal council and the joint management body for a lodging house licence to operate. Most importantly, the Airbnb premises must be situated on lands zoned for commercial or commercial mixed-use purposes.

Airbnb is not your run-of-the-mill business of renting out rooms for vacation. It actually supplements the income of Airbnb hosts or business operators. Based on an Airbnb survey of over 2,000 Malaysian guests and hosts, almost half concurred that the platform provides a key source of income in managing their daily expenditure and settling their bank loans. Airbnbs are regarded as short-term rentals as they are rented out for a few nights or weeks, often for vacation, business or events. Short-term rental income such as Airbnb rental is more profitable than traditional long-term rental.

During these pandemic times, people are increasingly less bounded to fixed homes or hotels, and are becoming more flexible in terms of choosing their choice of staycation. Airbnb has introduced three new ways to search for stays on the platform. They include Flexible Dates, Flexible Matching and Flexible Destinations. You may choose the date & duration of stay, number of check-in guests and a specific location on the map you desire. There are also Unique Stays for discerning lodgers as well as Outdoor Getaways for the adventurous.

For those who wish to operate an Airbnb within a condo, always remember to check with your condominium management. The Joint Management Body (JMB) possesses the authority to make additional by-laws as they deem fit. In the case of strata properties, whether you are allowed to host an Airbnb lies at the sole discretion of the residential building management. The owners of strata properties seeking to operate an Airbnb unit must make sure it is permitted by their condominium management. Strata titles are typically issued to units of houses or high-rise residences within a development that share common properties. Under the Strata Management Act 2013, the condo management has the right to impose a fine of up to RM200 to anyone in breach of any of the building’s by-laws.

While hosting an Airbnb is no simple task, the daily rate you could receive for a short-term rental like Airbnb is significantly higher than the average daily rate you would obtain for a long-term unit rental. But this also depends on other factors or variables such as strategic location, seamless connectivity, amenities and facilities, estate type, property condition and also home ambience. So, if you should decide to explore the infinite income opportunities that Airbnb has to offer, do check with your local council and also building management first. You might well be on your way to becoming a proud Airbnb host!