Being a mortgage broker in Hamilton for the past 25 years has allowed me to witness first-hand all the changes and trends which are occurring in our community.  Today, I will introduce you to a concept called, AIRBNB.

This company is not new; it has gained popularity abroad with over 190 countries offering unique living accommodations.  Owners are turning their extra bedrooms, basements and in some case their entire homes into online marketplace substitutes for travellers and business workers who prefer cheaper and more personal places rather than a hotel.

Is this concept working, well in Canada AIRBNB grew by 125%.  In Hamilton we have quietly built up 218 lodgings.  In San Francisco there are approximately 7000 locations and Toronto has over 3000 of these AIRBNB homes.  Sounds wonderful but this have frustrated hotel operations, lawyers, insurance professionals, landlords and especially condo corporations.

PROS OF AIRBNB

• Hosts get to meet people from around the world
• Hosts get some passive income
• Travellers often get to stay for less than a hotel room
• Travellers enjoy accommodations that offer a different experience
• Personalized service
• Cuts down on business costs

CONS OF AIRBNB

• Properties can be damaged
• Property does not match the description listed
• Host in unresponsive
• Some condo’s laws are prohibitive from renting in such a manner
• Some cities (Montreal) prohibit renting without a permit
• With their popularity increasing, lobby groups such as the hotel industry will argue that AIRBNB do not have to adhere to strict safety and fire regulations as they do

Some tenants have been very successful in renting their units.  One brilliant operation in Toronto has an occupancy rate of close to 85%.  Last year she brought in over $29,000 which she used to pay down her mortgage.  Most owners only get passive income so I would not encourage this as a get rich scheme.  This AIRBNB business and hosting must be in your DNA.

As for Hamilton, we mentioned there are over 200 such locations.  The prices ranged from $35 per night in the Hamilton downtown core to $1000 along the Stoney Creek waterfront.  Some hosts have just had the best testimonials.  If you are willing to try this experience in another city, do your homework.  For Hamiltonians some income for the homeowner and the chance for affordability for the tourists has helped market our city better.  With the Pan Am Games coming to the Hammer these locations should help show the world what a great city Hamilton is.

Robert Floris is a mortgage broker with Mortgage Architects in Hamilton, Ontario