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Amid Tourism Boom, Apartment Owners Forsake Long-Term Leases for Airbnb Fast Cash

Many apartment owners are turning to Airbnb and other short-term lease platforms in order to cash in on Vietnam's ongoing tourism boom.

According to VNAT, in the first half of 2018, Vietnam welcomed nearly 7.9 million international tourists, a 27% increase from the same period last year.

Stephen Wyatt, country head of real estate firm Jones Lang LaSalle Vietnam, told VnExpress that Airbnb and similar services are popular among these visitors as they are more affordable than hotels and full-service facilities.

Thanh, a Vietnamese landlord, told the news source that his apartments have been functioning as hotels for more than a year now. Tourists stay in his apartments for a few days before continuing their trips to other destinations in the country. His rooms are almost immediately ready to accommodate new guests when the previous tenants leave. All three of his apartments in Saigon can be booked via Airbnb, he added.

VnExpress also reports that the increasing number of apartments being built in Hanoi and Saigon has encouraged landlords to realize the opportunity of earning more through short-term leasing service. According to accounting and consulting company Grant Thornton, the main factor in this transition from traditional renting services to Airbnb is a willingness to experience something new and affordable in the rentals industry.

The market has changed significantly over past two years, as more owners shift from traditional rentals to registering their apartments on Airbnb. According to this news source, there were only 6,500 listings on the platform in Vietnam in 2016, but in 2017, this number grew to 16,000.

Tran Anh Khoa, a rental agent in Saigon, told the website that short-terms rentals can increase a landlord's revenue by 15-20% compared to long-term leases. He now can earn up to US$1,000 a month through leasing his fully-serviced apartment in District 2 on a short-term contract, compared to US$700-800 for long-term one. Khoa also shared that short-term rentals do not burden owners with contracts, allowing them to sell the property when they want to.

According to real estate service provider Savills Vietnam, the country is going through an apartment boom, especially in Saigon, with an additional 129,000 apartments coming into use by 2020.

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