Welcome back to another episode of Into The Airbnb, where we talk with Airbnb hosts about their short-term rental experience. Today's guest is Eugene Muller, based on Clanwilliam, South Africa, who owns and manages over 10 listings in two different towns. Today, Eugene will share with us about her Airbnb host experience and also give some useful tips for those who might be interested in hosting in South Africa. This episode is sponsored by Airbtics, the only one analytics dashboard for short-term rental investors and managers, where you can find precise Airbnb data such as occupancy rate, revenue, average daily rate, and so on. So, without further ado, let's get into it! So can you tell us how did you get started on Airbnb?
I was first into permanent rentals. But in South Africa, the law doesn't protect the the landlord, it protects the tenant. So the tenants start to be a problem because they don't pay and the law doesn't worry about that. But now I believe in property, I love property, so now I had to make something out of the property. So they know see, this guesthouses in Cullinam, Cullinam is quite a tourist town in South Africa is one of the 10 best rock climbing places in the world. So I see the guest houses are full and I thought maybe I'd just start with one and one became two and two became three. That's how I started. The main reason was because the landlord's in South Africa aren't protected at all.
I see, I see and in the areas you're hosting, how is the seasonality like? Is it like occuped all of the year?
Normally, before COVID. Everything is before COVID. May month for some reason in our town, in Clanwilliam, is not the best and most of the guest houses are close or some of the guest houses close and go overseas holiday and stuff. But then the small guest houses are open. So I have a bit of business. So May is our bad financial month, but 11 months of the year, we are quite full. So Clanwilliam is very populated or very popular place in the world and in South Africa.
I see that's great. So around the high season versus the low season, how is your occupancy rate like?
Okay, low season about 40/50% and the high season 100%.
That's great and what months are those? What season of the year?
The highest season? Okay. So, high season is from June till end of December. But our highest season is from one June till end of September. The 100% sort of thing.
During all the year, how is your pricing strategy?
Okay, so what we do is, I own two different towns. So the Clanwilliam's one was quite easy. I know the properties, I know the people. So when I started seeing the places and I know exactly where it was, I just compare my property to the rest and plus minus that price range. But then I bought a new place in Elands Bay and they it's totally different than mine. Firstly, my spot is 10 times better. The price range here is extremely low. So I just thought I'm not going to let me lead by them I'm better. So I just put my own price. So I'm the market leader in Elands Bay with the price.
I see and you price all by your own? Don't you use any pricing solution?
No.
Okay, that's great. So through all your years being an Airbnb host, what has been your top challenges?
Cleaning staff, it is really difficult to get good cleaners, really difficult. In these years, I started to, after a year or two, I got my stuff sorted out in Clanwilliam and everything is working perfectly. When I bought a new place in Elands Bay, like in one month in December, I had 16 different people working for me and I actually only needed two. So it was just about, they work for the day and then they just told me they don't work that hard.
Is it that cleaning staff problem like a common thing in South Africa? Have you heard about other hosts also struggling with it?
No. Luckily in Clanwilliam, really, we don't have a problem at all. The problem in this town, Elands Bay, I didn't really know the town and its people. So it's a small community, a poorer community, but the people is sort of the money, that they don't have a job and pleading for a job and when they have a job, they say no, no, thanks. You understand? So not in South Africa the problem, but definitely a huge problem in Elands Bay. So I'm still struggling. I still struggle to get staff that stick. They just told me it's too hard work. They don't work that hard and you know, unfortunately, the guest houses business the accommodation business is hard work because every place must be extremely clean. For the COVID regulations, you know, I don't want to go in a place that's dirty. So cleaning is very important and they just told me they don't work that hard. And then I must tell you so many places, guests booking into places they may check out, especially when I was a new in town, it was only three four months and then they check out and then they book with me. So that's one of the reasons I'm always fully booked, because they check out of other places because it's too dirty and then, they come to me.
I see, that's great. At least you have more public like that. So your guests, are they usually locals or are there tourists?
Clanwilliam normally is 90% overseas guest so mostly the overseas guests, okay, so tourists. But I've just started in Elands Bay, and here is 98% local people. So currently, in Clanwilliam, is also like 90% 95% local, but I'm talking about normally, we work with overseas guests, and 90% of our guests in Clanwilliam are overseas guests.
Wow, I see that's interesting.
Especially the Germans. The Germans love Clanwilliam. We are quite a hot town and they just love the sunshine and they love everything about us. Like I said the Rockland as they come here year after year, the same people. So if the same people comes back, it says something, you understand?
Yeah, yes, I see. Would you recommend to other hosts to start their Airbnb rental business in South Africa?
For sure I would. But currently with everything that's going on, it is difficult or it's more difficult. Like I've got quite a lot of places like I told you in January I had like five nights booked in all my places. Now if you need the money and you don't have reserve, then you've a huge problem you understand? It was January which was my worst month even with COVID we didn't have it like that. But saying you need to, can work with money. Airbnb is a wonderful thing to make money to pay property and everything, but you can't make the money and use the money. I was always in business from 17 years old. So I understand how it works that you have to put money back for, you know, 7 years and 10 years. Well, that's seventeen years. And we will now in seventeen years, and it was difficult. But yeah, hopefully the fattiest will come again, quickly.
So any tips you'd like to share with Airbnb hosts, especially the ones who host on South Africa?
In South Africa, the main tip I would say is, if you buy a property, you can make good money. But just remember, don't use the money. Use that money to pay your Airbnb. When it's almost paid, take that you pay in front, your Airbnb, in to the bank, then you take that money again, and buy a second one, then to pay back that bond, you understand? To try not to use the money, try to make an extra income, save, save, save to buy your properties. So eventually, then the second one is buy then you buy a third one and the third one, then is three Airbnb is paying off one. You understand how quickly you're gonna have more and more in Airbnbs.
How about restrictions there in South Africa or in the cities you host in?
Okay, so we don't have restrictions. So luckily, all my properties I have is business properties. So it's already assigned to that. But in South Africa, if you have two or more places on one plot, you have to redone it. But if you only have one place, and you're higher, it's no problem. Nobody is concerning. But we also have, like security estates, they have their own rule. You can't just open it and stuff. But the normal residential plots outside the security estates, no problem.
Great, good to hear that. Would you recommend foreign Airbnb hosts to open an Airbnb business in South Africa? Would it be easy for them?
From overseas? Or what do you mean?
Yes, overseas hosts.
You should if you have someone that can manage it for you because like I told you the cleaning is a problem. To find cleaning stuff is difficult. In other words, if you buy a property and you do Airbnb, you need to clean it. How are you going to do that? You understand? So in Cape Town, the big cities there is companies doing it. But then you give a lot of money away if you use a company to do that, then you have to have a high end type of property understand? That makes it worth your while. So yes, I would recommend it. But you must just sort out the cleaning.
Yes, that's the thing they have to solve. So that'll be it for today. Thank you for your time. Thank you for your tips.
Okay. Thanks a lot.
Thanks for listening to into the Airbnb. We're looking for hosts and other people in the short term rental industry to interrupt if you have what we need and would like to share your experience in this podcast, please send us an email. All the info is at the end of the description.
