At least a million dollars a year in fees is being handed over to Airbnb's American head office from its hosts in Orange.
Tim Mortimer, the founder of an Orange company Bnb Made Easy, which manages about 18 properties in the city, said hosts have to hand over 15 per cent of every booking to the parent company as part of their business arrangement.
He said that amounted to about $1 million a year going straight out of the Orange economy.
It is a huge problem for the region.Tim Mortimer, accommodation host
Mr Mortimer said the arrangement was costing the Orange economy at a time when cancellations were prevalent due to coronavirus fears.
He said Orange hosts were also being hit hard by a change in policy by Airbnb which allowed people booking accommodation full refunds if they cancelled now due to coronavirus concerns.
Mr Mortimer said it overrides hosts' existing policies, some of which require full payment if guests cancel within 14 days of the booking.
"We're getting cancellations every day. It is bad for my business but it is also bad for all of Orange's businesses," he said.
Mr Mortimer said April was normally a peak period for accommodation in Orange but with major attractions including the key FOOD Week events being called off many people were cancelling.
"April should be quite chock-a-block but it looks like a ghost town now," he said.
"It is really leaving a lot of hosts and myself, who run it as a business, in a pretty tight situation. It is a huge problem for the region."
Mr Mortimer said other short-term booking companies had not introduced the full refund policy like Airbnb.
"In this game, which is quite dynamic, it is not overly smart to rely on one platform," he said.
In a letter to the American government Airbnb said its worldwide coronavirus cancellation policy was aimed at protecting people.
"Our first priority is the health of the public and our communities. Our actions have been organised around the safety and wellbeing of our guests, hosts, employees and the communities in which we operate," it said.
"We know this will mean a significant loss of bookings and a large number of cancellations for our hosts and we are working on a plan of action to help them get through this extremely difficult time."
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