Sharing isn’t new. But the way people are sharing is new. Your mother’s encouragement to share nicely is moving from a polite social activity to a profitable business.
The aptly named “sharing economy” is a platform for sharing goods or services with people who want to use them either for free or for a fee, typically by means of the internet.
A 2015 PricewaterhouseCoopers study found that 72% of Americans have used some type of shared or on-demand online service like eBay or Craigslist, ride-hailing apps like Uber, or online home-sharing services like Airbnb or Vacation Rentals By Owner (VRBO).
The latter two provide a way for people looking for overnight accommodations in a particular place to find people who want to rent out an extra room or an entire house.
The study also found that what consumers liked best about the sharing economy was saving money and having a “unique experience.” In recognizing this, Airbnb is using the tag line, “Live there” which encourages travelers who use its service to live like a local while they are renting someone else’s space.
‘Selling an Experience’
That’s exactly what Ryan and Michelle Malashock offer guests who stay in their 600-square-foot guest house near downtown Bentonville. Their rental is listed on Airbnb, VRBO and FlipKey.
“We are selling an experience, not just a place to stay. [Guests] get to live our lifestyle in a weird way, live downtown where we live,” Michelle, age 33, said. “They get to experience things how we experience them.”
Ryan, 36, said their guests’ experience is enhanced because they stay with people who can tell them what to see in town.
“We can tell them to go to Table Mesa, go get a crepe, walk down to the taco truck … walk to Compton Gardens, go on the Crystal Bridges Trail,” he said.
“What I personally love is when I see [our guests] out and around town enjoying the city. I’ll be at the farmer’s market, and I’ll see my guests walking around having a great time,” Michelle said. “I love that I feel pride that they are loving Bentonville as much as I do.”
It was Valentine’s Day, 2015 when Michelle first saw the home and potential home-sharing opportunity. The property, which included the two bedroom, single-bath guest house located behind the main home, was for sale by owner. Michelle told her husband they were going to buy the home and “do an Airbnb.”
“And my husband thought I was crazy. But the same day he saw the house, and he fell in love with it too,” she said, adding that the extra income helped them afford the property.
Mountain Bikers, Corporate Guests
In the past 18 months, the Malashocks have booked the guesthouse 88 times with travelers from 25 states ranging from Texas to Oregon, and Washington, D.C., and from Israel. Next summer they will add to their international guest list with a booking from Germany. Stays last anywhere from one night to six weeks.
Their renters included art aficionados coming to see Crystal Bridges Museum of American Art, corporate relocations, groups of women on girls’ trips, two young women and their father who came during Walmart’s Shark Tank week to pitch a product, mountain bikers coming to ride the trails and a family that stayed six weeks while the mother was interning at the Wal-Mart home office pharmacy.
Michelle said one of the most interesting groups to stay in the house was an up and coming American folk band made up of three sisters from Portland, Ore.
“The band Joseph stayed here,” she said. “Months later they were on [‘The Tonight Show Starring] Jimmy Fallon.’ I’m like, that band stayed at our house, and that’s pretty cool!”
The guesthouse sleeps six, includes a full kitchen and a full-sized washer and dryer, and the Malashocks welcome children and dogs. Current rent on weeknights is $110, and $135 on weekends, with a minimum stay of one night. Ryan said taxes are absorbed into the cost of the rental, but there is a cleaning fee of $50 and a VRBO or Airbnb service fee that are passed on to guests. Prices are increased for special events like the Bentonville Film Festival.
Michelle said they charge less than other rentals because they want to be competitive and want to keep the guest house full. The house is rented about 75% of the time throughout any month.
“We’ve never gone more than five days without someone in it,” Michelle said.
A recent check of the Airbnb website showed Northwest Arkansas (NWA) offered 300-plus locations costing an average of $156 per night. VRBO listed approximately 250 rentals in NWA. Some rentals, like the Malashocks’s, may be listed on both sites.
‘Secluded’ in Springdale
Arthur and Leslie Ray, ages 55 and 60, offer a different experience to guests at their “charming, secluded bungalow” on 5 acres in Springdale, via Airbnb, VRBO and Craigslist.
“I think that a lot of people book here because we have a very private location. There are people that want to be downtown, want to be within walking distance, they want to be part of the action, the noise, the music. But, there’s people that want that during the day, but at night they don’t want that,” Ray said.
When the Rays bought their property in the late ‘90s, the bungalow, in great disrepair, came with it. After building a home on the land, the Rays decided to repair the bungalow. In the midst of the repairs a hailstorm damaged the roof and before the roof could be replaced, another hailstorm demolished everything inside the house. At that point, the Ray’s insurance paid to have the house gutted and totally re-done.
“After it was repaired my husband said we should explore using it as a short term rental online. But, we thought, Arkansas, seriously? Who’s going to want to come here?” Ray said.
In the years since, the Rays have found a good market for their 1,200-square-foot, three-bedroom, two-bath bungalow, which sleeps eight. The bungalow is rented about 35% of the time, which is satisfactory for the Rays.
“We didn’t buy this place to make it a rental,” Ray said. “It pays us enough so we’re able to keep up with expenses with a maybe a little bit of profit left over.”
The Rays have hosted a wide variety of guests such as motorcycle riders for Bikes, Blues & BBQ; families in town for a wedding, fans attending Razorback football games, attendees of the Bentonville Film Festival, and families coming to enjoy Beaver Lake in the summer.
“There is one group of ladies that’s come two or three times for the War Eagle Fair,” Leslie said. “I love them! They are all older, like me and it’s like a ladies’ weekend out. There’s seven or eight of them and they all stay here, and they all bunk together. And I guess it’s like a sleepover for them.”
Ray said she had a guest come from Norway. “It just so happened that we were on a trip ourselves, and there was a snowstorm here. And it took out our internet service. She was really counting on internet to communicate with all her friends and relatives. I felt so bad because there was nothing I could do,” she said.
To make up for the inconvenience, Ray gave her a $150 refund and directed her to several places in town that did have internet.
“I will do anything to avoid getting a bad review,” Ray said. “We really do go out of our way.”
The bungalow rents for $200 per weeknight with a two-night minimum, plus a $100 cleaning fee, taxes and the VRBO or Airbnb service fee. There is also a $250 refundable damage deposit. On weekends the rent is $225 per night, with prices increased for special events in the area like Bikes, Blues & BBQ.