Airbnb, the online platform that lets people rent out their homes to travelers, is facing a harsh reality check as its revenues have halved in some parts of the U.S. in the past year, according to a recent chart from AllTheRooms, a short-term rental data and analytics group.

The chart, which was shared on Twitter by Nick Gerli, CEO of Reventure Consulting, a real-estate advisory company, shows that Revenue per available listing dropped by nearly 50% in cities like Phoenix, Arizona, and Sevierville, Tennessee, between May 2022 and May 2023. Other cities that saw significant declines include Austin, Texas, Nashville, Tennessee, and Denver, Colorado.

Gerli warned that the “Airbnb collapse is real” and that it could trigger a housing market crash “on par with the 2008 subprime crisis” in some cities, as struggling Airbnb owners may be forced to sell their properties. He pointed out that there are more Airbnb/VRBO rentals than homes for sale in the U.S., creating a “huge home price downside” if the supply of listings increases.

The Airbnb collapse is real.

Revenues are down nearly 50% in cities like Phoenix and Austin.

Watch out for a wave of forced selling from Airbnb Owners later this year in the areas hit hardest by the revenue collapse. pic.twitter.com/xjGkj7bFC5

— Nick Gerli (@nickgerli1) June 27, 2023

The reasons for the revenue slump are not clear, but some possible factors are the changing travel patterns due to the pandemic, the increased competition from hotels and other accommodation options, and the regulatory challenges that Airbnb faces in some markets. Gerli suggested that fewer people are working from home and vacationing in states like Montana, Texas and Tennessee.

The news comes as a stark contrast to Airbnb’s recent promotion of a Barbie-themed DreamHouse mansion in Malibu, California, which is temporarily back on its listings for two lucky applicants who will get two free nights in the pink paradise, as part of a collaboration with Warner Bros. for the upcoming comedy film about the iconic doll.

While some may dream of living in a Barbie world, Airbnb may need to wake up and face its own problems before it’s too late.

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History of Airbnb

Airbnb was founded in 2008 by Brian Chesky, Nathan Blecharczyk and Joe Gebbia. The idea for Airbnb was born out of necessity when Chesky and Gebbia were struggling to pay their rent and came up with an inventive way to make some extra money. The first Airbnb startup story revolves around airbeds and rents. With the upcoming Industrial Designers’ Conference in San Francisco, there was a shortage of hotel rooms and accommodations. Chesky and Gebbia decided to rent out airbeds in their apartment to conference attendees. They put together a website that offered short-term living quarters and breakfast for those who were unable to book a hotel in the saturated market. They officially launched the site Airbedandbreakfast.com on August 11, 2008. They later changed their name from Airbed & Breakfast to Airbnb and expanded beyond rooms to offer apartments, whole homes, and vacation rentals. Airbnb is now a global online marketplace for short- and long-term homestays and experiences, with over 4 million hosts who have welcomed 1.4 billion guest arrivals in almost every country across the globe.

The post Airbnb’s DreamHouse Turns into a Nightmare as Revenues Plummet first appeared on Spire Founders.