How is Blueground Different from Airbnb?


January 17, 2019

When holding onto a spare property that’s sitting empty, landlords and property owners have many options to turn their space into a source of income. The conventional route is to seek out long-term tenants. Although with low barriers to start a rental, you as a landlord are implicated for everything from repairs to on-time rent collection. Another popular option is to convert the space into a vacation rental through sites like Airbnb, HomeAway, and VRBO. Here, property owners also become “hosts” who are involved with greeting guests and maintaining a vacation property with a frequent turnaround. Finally, there are options that take over the whole renting out and furnishing process altogether, like Blueground.

Deciding between the three options is not so straightforward. Factors like your property’s condition, location, and rental value will decide what kind of guest or tenant is best. Additionally, your personal skill set and time allocation to being a host vs. landlord vs. simply a property owner will also make a difference.

If Airbnb is a marketplace for hosts and guests to connect for short stays, then Blueground is a single host specializing in a complete guest experience for stays of a month or more. In this article, we walk you through the latter two options and present the ideal property owner scenario for both.

Airbnb

Since 2008, Airbnb has primarily served budget-minded tourists. Although, the attractiveness of staying in someone else’s home goes beyond the travel expense report. From it’s beginning in San Francisco, Airbnb homes now exist in nearly every city center and remote corner of the Earth. These properties allow travelers to trade in the cookie-cutter hotel experience for one that offers a unique and comfortable space.

Each apartment is managed by an individual host which means that no two are the same in layout, decorations nor experience. The degree of guest interactions varies greatly as well. Some hosts personally greet guests on arrival, compared to larger companies who streamline the check-in process, like Blueground.

landlord resources blueground making a bed

Indeed, Blueground also lists on Airbnb for bookings of a month or longer in its 6 US cities, in addition to Athens, Dubai, and Istanbul. The real estate technology company sees Airbnb as a complimentary listing channel rather than a direct competitor.

When does Airbnb make sense, as a property owner or host?

  • You have the time, energy and passion for greeting, hosting and helping travelers
  • Your property is near a tourist or business center with a high potential for returns
  • You have a space that you’ve decorated as your own and you’re proud to show off
  • You enjoy the excitement of a regular flow of new guests from around the world

The prime consideration on the part of landlords when considering to host on Airbnb is whether they have the resources to directly manage to host themselves. Airbnb’s homes run the gamut of housing types from backyard trailers to apartment lofts. On the high end, Airbnb Plus verifies a selection of homes with premium furnishings and top-tier hosts.

Perhaps the biggest risk for hosts is that their personal property will get damaged. While most transactions occur without incident, there are horror stories of entire houses being trashed by party-goers when the Airbnb hosts thought they were renting to a quiet suburban family, or an instance when a host came home to find her property had been severely damaged and items had been stolen. While Airbnb as a company offers damage reimbursement, the Host Guarantee program can’t provide complete peace of mind. Property owners must understand what’s covered and what’s not, for example, cash, rare artwork, jewelry, and pets.

In recent years, some local councils have taken measures to curb the rise of Airbnb properties through regulation. This includes imposing a tourist tax, requiring registering with the authorities and even capping the number of host licenses.

Blueground

Blueground is a start-up that offers a turnkey housing solution for renters looking to stay for a month or longer. What started out in 2013 as a relatively niche concept of taking over unfurnished apartments and outfitting them with best-in-class furnishings has now spread around the world. Their current markets are the United States, Europe, and the Middle East. Their business model differs from Airbnb in that Blueground is the sole “host” and effectively acts as a property manager.

As opposed to Airbnb which focuses on short-term stays, Blueground caters to stays of a month or longer. Instead of just holiday goers, they focus primarily on business executives. That includes relocation for work, digital nomads, and extended business trips. We regularly host senior business executives from large multinationals, embassies, and film production companies. Furthermore, every property is furnished and completely managed by the company to ensure consistency and to offer tenants the flexibility to move between apartments. A skilled team of interior designers transforms a landlord’s empty and relatively bland property into a stylish premium apartment. The high-quality makeover is one of the many aspects that appeal to both owners and renters.

living room in a Los Angeles based apartment managed by Blueground

When does Blueground make sense, as a property owner or landlord?

  • You’ve invested in your property as a source of passive income
  • You would prefer to hand over property management to another party in order to free up your time from finding and communicating with tenants
  • Your property could use an interior design makeover
  • You have a property portfolio that you can not manage on your own
  • You’re concerned about rental gaps between leases
  • Your property is located in a city with strict short-term vacation rental regulations

How much commission does Blueground take?

Blueground does not take a commission from your rentals. In essence, we are your primary tenant and takes care of sourcing business executives and expats as your subtenants. The landlord and Blueground first agree on the rent, then as your renter, we pay out this monthly rent, regardless of whether the unit is occupied or not. Blueground’s earnings are already factored into the final rental price charged to the subtenant.

Blueground owner benefits

This approach benefits property owners for various reasons; they do not have any gaps between tenants, do not pay brokerage fees, and also do not need to spend time dealing with tenant-related issues. Blueground does it all. The only thing the owners have to remember is to collect their passive income. All other aspects of property management are taken care of.

For owners who want to handle things themselves but need a little extra help, Blueground offers this online guide, which covers all the necessary information from decoration ideas to tenant interactions.

By specializing in month-or-longer stays, Blueground is not restricted by the same vacation rental regulations faced by typical Airbnbs. In Airbnb’s most popular US city, NYC, landlords who aren’t able to host Airbnb nightly guests legally in their apartment block may seek out a partner like Blueground to find monthly tenants.

Blueground guest benefits 

Guest are continually impressed by the premium decor (furniture, linens, tableware, and home entertainment). Unlike a majority of Airbnb photos, Blueground commissions professional photos to show each room’s best side. Guests are often overjoyed when they arrive and find that the place actually looks even better than the photos online. Tenants also appreciate that the homes are in new or recently renovated apartments. Move-in ready properties are a result of meticulous attention to detail, as well as the love and care that goes into making every place a home.

A father and mother and daughter are standing in the living room of their apartment hugging tightly

From a technology standpoint, they have another advantage. A mobile application is available once the apartment is booked. Through its user-friendly interface, cleaning and maintenance services can be requested. In addition, neighborhood advice, maps and contact information are available as well. Blueground’s landlords and guests benefit from a dedicated Client Experience team they can reach at any point in their lease.

In summary, Airbnb leaves the property owner to take the reins of hosting and marketing for short term stays. For the entrepreneurial homeowner, there is a high level of involvement and reward but they are also restricted by new local vacation rental regulations. However, Blueground’s model goes beyond being a marketplace. The property technology company takes care of the entire renting process from new furniture through to collecting rent. In contrast to a revenue-share system, Blueground pays landlords their monthly rent whether the unit has an occupant or not. Additionally, the company’s tech, dedicated client experience team and consistent furnishings set their apartments apart from the rest.


United States