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It was meant to be the holiday of a lifetime. After months of planning and saving, a trip to the Cayman Islands awaited. Then with the quickly spiralling, global coronavirus crisis, many prospective visitors to the islands earlier this month simply did not feel they could travel to the Caribbean, or anywhere else, at this time.

But when tourists tried to cancel their accommodation, some were in for a nasty surprise.

Sue Hammon from Michigan booked a holiday property in Cayman Kai on VRBO. She tried to cancel her reservation, she told the Cayman Compass in an email, but the property owner refused to give a refund or even credit for a future stay.

Hammon said she simply could not take the risk of her family travelling but cancelling was also the right thing to do from a public health perspective.

“I empathise with property owners and the dilemma they are facing,” she said. “But the reality is that everyone is taking an economic hit, and the dollars and cents pale in comparison to the health of Grand Cayman if doors remain open. It’s our moral and social responsibility to not travel, and those advisories are coming from every angle.”

Hammon said her family had saved and planned for this vacation for 18 months. “It’s so incredibly disappointing because we want to do the right thing and stay home but we will lose $8,000 if we cancel. It’s gut wrenching when finances and resources are already perilous.”

She added, “Property owners and VRBO should be ashamed for taking advantage of people’s unfortunate circumstance.”

VRBO sent a message to travellers earlier this month stating that the company has encouraged property managers “to adopt more flexible cancellation policies in light of COVID-19” and to offer full refunds to those wishing to cancel because of concerns for their own well-being. However, the company did not change its policies.

Earlier this week, Premier Alden McLaughlin addressed the issue of potential visitors asking for their money back, calling on properties to return deposits.

Responding to a question on the situation at a government press conference on Monday, McLaughlin said tourists had written to him directly about property owners refusing refunds for cancelled holiday rentals.

“My strong advice to the hospitality industry is to refund those deposits. This crisis will not last forever. We want this business to return to Cayman,” he said. “We want people to feel good about the Cayman Islands and the way we treat people. Refund the deposits.”

Cancellations – bad news for everyone

Property owners are of course being hit very hard by tourism grinding to a halt in the middle of high season. Some try to compromise and find what they believe is the middle ground.

One potential holidaymaker told the Compass on Twitter that his family was due to fly to Cayman on 21 March. Following the government ban on air travel, they are now unable to do so. When asked for a refund the property owner responded that she had hoped more people would have taken advantage of travel insurance but only about half of the bookings had done so.

Faced with 13 cancellations in one evening, she suggested to refund half of the money or credit the family for a stay in the future, with the exception of Christmas week.

For many property owners, the decision on what to do has been taken out of their hands.

Those advertising their properties on the most popular short-term rental service, Airbnb, have six options to set their cancellation policy from flexible to very rigid. Airbnb itself does not interfere in the process, unless a very limited number of extenuating circumstances, such as a death in the family, applies.

However, on 14 March Airbnb expanded its extenuating-circumstances policy in response to the COVID-19 pandemic, overriding the individual cancellation policies of hosts.

As a result, most travellers who booked with the company before 14 March for a trip between 14 March and 14 April will qualify for a full refund without penalty.

HostGPO, a short-term vacation rental group-purchasing organisation, did not take the news well and urged Airbnb to reconsider.

In an open letter to Airbnb about the new refund policy, the organisation said, “Extending refunds to practically everyone through April 1st, will be absolutely devastating to hosts, many of whom will lose a whole month’s revenue due to nothing more than paranoia.”

To prevent hosts from losing their livelihoods, HostGPO added, “it’s important to make sure that hosts survive the unprecedented onslaught of cancellations.”

Mary McLaughlin, who advertises three family properties in West Bay on Airbnb said she supports the company’s decision. “I am proud of Airbnb for doing that and taking care of their people. Obviously financially it is difficult for me,” she said.

Initially, none of the holidaymakers who had booked her properties at Villas Papagallo had asked for a refund but enquired about rebooking. “No one wanted to cancel, everyone wanted to come.”

Only when Airbnb announced that 100% of the money would be refunded, she said, five cancellations came in the next morning alone.

McLaughlin said she had anticipated the unprecedented wave of cancellations by observing what was happening in the rest of the world and she already made the decision to switch her properties to long-term rentals to cover her expenses.

Over the last two years, with the advent of services like Airbnb and VRBO and the growing acceptance of homesharing as part of Cayman’s tourism product, many rental properties have been converted to short-term holiday rentals. However, the next weeks are likely to see a reversal.

In 2018, Airbnb reported in the latest available statistics that 340 hosts in the Cayman Islands had welcomed 16,400 guests and received on average $16,500 a year.

This figure was expected to have increased significantly last year. Homesharing is estimated to have added more than 700 rooms to Cayman’s total room stock of more than 7,000 in the past three years.

Mary McLaughlin said she is positive that the crisis will be short-lived, and the vacation rental market can recover quickly. She believes once the spread of the coronavirus is under control, tourists will be ready to return to the islands. “Every single person that has cancelled can’t wait to come to Cayman in May or June or July,” she said.

Full coverage: Coronavirus

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  1. I have little sympathy for these property owners who have jumped on the Airbnb (and others) bandwagon to pad their pockets. This has resulted in a shortage of long term rentals for residents raising rents significantly and causing hardship to many. I hope the current situation will cause a substantial drop in rents as more properties come on the local market.