1,300 Jobs Culled At Largest Hawaii Vacation Rental: Shocks Industry

This week, Hawaii’s largest, fast-growing and now controversial vacation rental company, Vacasa, laid off 17% of its 7,600 US employees in a sign of weakness in Hawaii’s vacation rental sector, among other things. It’s not clear if that will be enough to solve the company’s deep-rooted problems. In addition, the industry has been hit by slowing demand and downward pressure on prices after post-Covid interest rates rose too quickly and too high.

CEO Rob Greyber said: Vacasa has more work to do. We must reduce our costs and remain focused on becoming a profitable business.

Vacasa was the darling of the vacation rental industry not so long ago. Until recently, nothing seemed to be able to stop her. Revenue growth was last at a staggering 81% year over year at the end of 2021.

1,172 Hawaii vacation rentals in Vacasa – for now.

Vacasa is unique in its full service approach. It manages, maintains and markets 1,172 Hawaii vacation rentals and others across the United States. The company went public in 2021, after which it disappointed investors by missing financial targets and mounting problems with its operations.

Last fall, they began layoffs, warning of sluggish sales and higher-than-expected costs. CEO, Rob Greyber, also warned that many other issues would take time to come to grips with.

Partly as a result of this and industry-wide holiday pressures, Vacasa’s stock had taken a hit, falling 82% from its IPO. The company has also lost most of its value, from $4 billion to $760 million.

Greyber said, “I’m optimistic about Vacasa’s potential.” BOH: We hear the words but not the music anymore.

BOH accommodates vacation rentals in Vacasa Hawaii.

Even before that, there was considerable dissatisfaction, particularly among homeowners, and controversy over how Vacasa ran its affairs. It is notable that Vacasa has a 2.5/5 rating in Yelp reviews. Their reviews tend to swing either very positively or very negatively.

The situation at Vacasa could now become an opportunity for local and smaller vacation rental companies who have previously been under severe pressure from Vacasa’s size, superior technology and financial dominance.

The last time we wrote about Vacasa, some of the comments included:

“We rented a property in Vacasa… and it was in poor condition when we arrived. We didn’t stay in the house and they didn’t give us a reasonable refund. I’m not sure we’ll ever use them again.”

“No wonder Vacasa stock plummeted. I have used them 2x. Needless to say I was very disappointed when they converted the weekly rental rates to daily rental rates which were almost double what they were before. So I paid for 4 days basically the same amount I paid for 7 before. Especially since I noticed numerous cleaning deficiencies. Kitchen stove fan/fan caked with bugs/grease that could fall into your pot while cooking. Just 1 example. I clean for a living so I’m very detail oriented on certain things that really matter. I actually received a cleaning refund for ‘terrible cleaning’ by their team a year ago.”

It’s worth noting that there is a Vaasa scam victim page on Facebook for those interested. The most recent comment on this page reads: “Vacasa wants to sell and has already been turned down by at least one company, an international vacation home rental company.”

Vacasa is similar yet different than Airbnb.

Airbnb remains the standard in Hawaii vacation rentals. Most vacation rental managers, as well as individual owners, list their units there. It is the ideal location where visitors are looking for Hawaii vacation rentals. Vacasa, on the other hand, is a management company, unlike Airbnb. With Airbnb rentals, these functions, including customer service, cleaning, and repairs, are left to others.

Vacasa charges up to 35% of the total cost of a rental for its combined listing and administration work. The concept has worked well in theory, at least, as it allows remote owners to operate their vacation rental hands-free while potentially thousands of miles away.

What renters aren’t necessarily aware of is that many of Airbnb’s Hawaii vacation rentals are actually managed by Vacasa. Vacasa is possibly the largest property manager of Airbnb rentals.

Vacasa spends heavily on advertising and technology to ensure they draw attention to their rental properties. To achieve this, they offer their rental properties in addition to their own on up to 100 different booking websites, including Airbnb.