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Online platform to rent semi-abandoned houses for a low price

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Povilas S
Povilas S Aug 03, 2021
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Originality

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Feasibility

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Necessity

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The idea is to create a platform dedicated for rent of buildings that are less suitable for living because of various reasons - they are not (or partly) furnished, the interior lacks a finish after the house was built, they lack some basic amenities, etc. Such properties could be rented for various purposes, but my main idea is to use them for short-term rent, so the page would be similar to booking.com or air bnb, just targeting lower-quality accommodations, it would be like squatting for little money. The buildings originally intended for a different than living purpose could also be used (garages, warehouses, factories, etc.).

Why this might work for both the owners and the customers:

From the owner's side: There are quite a lot of such semi-abandoned houses and flats that the owners simply keep locked and don't do anything with them (they might lack the money to finish equipping the interior, they might live quite far and only come there rarely for a few days and lack motivation to do anything more with the place, etc., there are many reasons you can think of). I know at least a couple of these types of places from the circle of acquaintances and one is an apartment in the center of a famous seaside resort. You can also often spot places looking semi-livable just walking in various urban areas.

The problem (and the opportunity) here is that if the owners are not willing to invest money/effort to bring the place to the level fully suitable for living, they can't really rent it either. You can put an advertisement of such a place on a website intended for normal rent, but those cases are unusual and it will end up lingering at the end of search results, also reviews are tricky in such case because you are in a marketplace of normal accommodations.

Some people simply don't want to bother about bringing the place to a level of "common sense" tidiness and comfort for guests even if they have an unused property that is fully equipped, with all the amenities, etc. Especially in the case of short-term rent, the place has to be cleaned often, after each visit, to prepare it for new guests. If you have a semi-abandoned place, on the other hand, the problem of how nice it will look is already out of question, the problem of guests ruining it, breaking something, dirtying the surfaces, etc., is also way less relevant. If the interior lacks a normal finish, you'll paint everything over anyway, there's not much to ruin there. So if the owners could make some constant (even if little) income renting the place while doing almost nothing, they might be happy about it.

From the guest's side: The main target audience, in this case, would be low-budget travelers. The price of such places should be approximately equal or lower to the average price of a bed in a hostel dorm in the same area. The main advantage of renting such semi-abandoned place over sharing a room is that you can have the whole place for yourself, have privacy, no noise, etc. Some people might prefer this instead of more comfortable amenities (I would). Also, in popular tourist destinations, at peak seasons almost every place (including hostels) might be booked and those that are left are usually crazy expensive. Such places of lower comfort/aesthetics could be in quite high demand at those times (and likely not only by low-budget travelers).

Squatting for free vs. paying:

In many countries squatting is illegal. In places where it is legal, it often creates its own problems. One common example is when laws become too favorable for squatters and the owners might have a really hard time trying to take their property back. Barcelona is a good example - my cousin lives there and she told me how her acquaintance once went abroad and left her flat (the flat was in completely good shape) empty for a few months. The squatters broke in (literally broke the lock), started living there and she didn't even know about it. When she came back they were there already for a long time and because of this it was hard for her to prove in court that they illegally broke in in the first place, she couldn't force them out without a court order at that point and when she finally managed to get it, the place was turned into a total hole, valuable things were sold, etc.

I'm not against squatting, I think it's a great thing, but the laws regarding it have to be wise. I think creating a market for squat-like accommodations might help solve cases like the above mentioned and be beneficial for many people, both low-budget travelers and the owners of such properties.

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Creative contributions

Include a brokerage option to increase the platform's reach

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Darko Savic
Darko Savic Aug 03, 2021
The platform users could opt to pay a brokerage fee and point out some semi-abandoned real-estate they are interested in. Brokers would then try to reach the owner and arrange the deal.

If a deal was not possible the broker would at least tell the user how far they were able to reach, what the owner says, what prevents the deal from being made, etc.

If the broker was unable to reach the owner at all, the fee should be refunded to the user.
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Rules and regulations

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Darko Savic
Darko Savic Aug 03, 2021
People using buildings for purposes they weren't intended could get the owners in trouble with the law. Also, if people get hurt in buildings that are in poor shape, could the owners be at fault in the eyes of the law?
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Povilas S
Povilas S4 months ago
I will address the second issue first - I'm more thinking buildings that are not in such a bad shape, they shouldn't be in danger of falling down, have holes in the floor, open electricity wires or anything like that, they should be in reasonably good shape, with proper windows, doors that can be properly locked for the users to feel safe there, there shouldn't be any massive gear, sharp objects, etc. lying around on which you could stumble, the owners should take care of that.

But on the other hand, you can hurt yourself in a fully equipped home of someone else's as well, you can then find reasons to blame the owners if you want or you could admit you weren't that careful yourself. But of course, there shouldn't be anything obviously dangerous, the owners should take care of that before letting people stay there or inform them if there's something they should be careful about in advance. The platform would quickly get a certain "reputation" anyway and be known as something slightly weird (because of reasons similar to what you mention here), but that's fine, it will occupy a certain niche between punk websites and normal business platforms. Every alternative platform has certain risks and disadvantages associated with it (e.g. Couchsurfing), but they successfully persist nevertheless.

About living in buildings intended for a different purpose - this is kind of a grey area in law usually, as far as I know, it perhaps depends on the country, but in Lithuania, they build new buildings that are originally purposed for business (office type) and then sell them as apartments. It's popular to make livable lofts out of factories, warehouses in many countries, sometimes the purpose can be legally changed, but not always, nevertheless, people still live there. In cases when there would really be problems with the law because of this, the buildings originally intended for a different purpose could not be rented through the platform, at least in that particular country, because that would get the website in trouble.
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Remove Conflicts with Rule of Law to Pave Way For New "Squatting-inspired" Ultra-low-cost Hospitality Sector

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DE
D. Eagle Aug 05, 2021
I understand the principle of the idea, but also see areas of fundamentally prohibitive conflict with the rule of law, which include, but not limited to these:
  • Change of use - material change or conversion from existing to new use-class (e.g. munitions depot to hospitality use), as rightly raised by Darko earlier
  • Unfitness for human habitation - for a property to be deemed unfit for human habitation, one or more of the following must be absent, dysfunctional or unsafe: natural lighting, ventilation, water supply, drainage and sanitation, facilities for preparation and cooking food, facilities for the disposal of waste water, the internal arrangement of furniture and appliances, any other hazards which risk your health or safety
  • Dangerous premises - properties that aren't properly maintained and compliant with building and safety codes or are otherwise unsafe, also as raised earlier
  • EU Convention - although not explicitly included in the European Convention on Human Rights (ECHR), the right to adequate housing is enshrined in numerous concrete legal norms, namely Article 2 (right to life), Article 3 (prohibition of torture or inhuman or degrading treatment), Article 6 (right to a fair trial), Article 8 (right to respect for private and family life), Article 13 (right to an effective remedy), Article 14 (prohibition of discrimination), Article 1 Protocol 1 (protection of property)
  • UN International Law of Right to Adequte Housing - Universal Declaration of Human Rights on right to a standard of living adequate for health and wellbeing (article 25(1)) and International Covenant on Economic, Social and Cultural Rights (article 11(1)). These pieces of international law impose legal obligations on states parties
In addition, other key considerations include:
  • Historical background that led to the state of dereliction, which may render the venture unviable or add value to it
  • Conservation of local or world heritage - like historical background, this may affect the viability of the project negatively or positively
The aim of setting out these critial issues is simply to focus the mind on the practical legal realities of the real world right from the outset. Some platforms, to their detriment, have chosen to ignore how the real world oprates to provide technology-enabled traditional services and call themselves "technology companies", in a futile attempt to hide under the veil of internet neutrality. Sooner or later the slow grinding mechinery of the realworld legal system will catch up, as Uber and others have come to realise.

Target Market

These conflicts MUST safely be removed to pave the way for an entirely new highly viable "squatting-inspired" ultra-low-cost hospitality sector, which is targeted at the back-packing traveller/adventurer.

Property character

There will be upfront capital costs to renovate the properties to the intended standards. The finished properties will be structurally sound and well-insulated with the charm of restrained character - worn ceiling, wall and door/frame finishes, old fittings, polished concrete or stripped wooden floors, warm, clean and comfortable, etc. Sanitary and cooking amenities are modern, but with old/period fittings (ideally, salvaged) to reflect property period and enhance the "squatting" experience.

Regardless of any local poor standards, all properties will be renovated to international quality, but with local character.

Assume that the head image shows an acquired property undergoing renovation before operation.

Business model

Free membership

The platform is a free-memebership website with network effect and possibly e-commerce (shop; ad, promo and sponso publishing).

Rooms
These may be offered as shelter only (minimal or no room furniture) or shelter-and-breakfast at ultra-low-costs and marketed with local attractions. Guests bring their own back packs or collect on arrival.

Properties may be leased to the platform for a certain term, in which case, the platform takes full responsibility for management and maintenance (e.g OYO). An alternative arrangement may allow the host/owner to take full property-side responsibility for hosting, management and maintenance (e.g. AirBnB) or involve a combination of both options.

The platform will earn commission or retain full rate paid, depending on arrangements with the property owner.

Property Sourcing

Members may be encouraged by way of special offers, etc to find potential suitable properties in their local areas and possibly become ambassadors for the properties, if successfully acquired by the platform and operational.

Partnerships

Once established, partnerships with budget airlines and other compatible operators will help the platform scale and enhance its unique selling point (USP).

"Squatting for free vs. paying"

Both could be achieved seamlessly, if the platform unlocks the hidden value of "squatting" as a means of adventure and lifestyle (normadic).

Squatting involves wider complex social issues that relate to homelessness and should seriously be considered in the round. Generally, people who squat are forced to do so, due to personal circumstances and not in a position to afford paying rent for the squat; albeit trashing the very property that gives shelter will be viewed by any reasonable/responsible "squatter" as senseless and inexcusable.

Nevertheless, if this is an area of interest for the platform, it could operate as a social enterprise with commercial and non-commercial activities to provide a wider positive social impact. This means that some properties leased to the platform could be made accessible to the homeless for free or social rent in relation to those entitled to state benefits; in short, depending on personal circumstances.

It is also a good way to partner with local authorities to secure property supply and benefit payments. The platform could lease empty derelict flats from local authorities on a peppercorn-rent basis, for reviewable fixed terms. It will then refurbish the properties minimally, for both commercial short-stay and non-commercial temporary accommodation.

Starting up

A squatting-inspired online platform without any conflict with the rule of law is highly viable. It should certainly be pursued with a well-defined business plan. Source funding, develop website and start with one suitable local realsite, as a route to market.
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