How AirBnb is hurting an already high-cost, shrinking housing market

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HOUSING CRISIS - There have been many public complaints about short-term rental sites like AirBnB, VRBO and HomeAway over the past couple years — and not just because of those wild cleaning fees.

There have been many public complaints about short-term rental sites like AirBnB, VRBO and HomeAway over the past couple years — and not just because of those wild cleaning fees.

Along with that short-term rental effect, a housing shortage from other reasons — like a major slowdown of building and exclusionary zoning laws — has already pushed housing prices in the U.S. up about 20% within the past year. Mortgage rates are at the highest they’ve been since 2006. First, the data suggests that AirBnBs are shrinking the long-term rental market by converting homes to short-term rentals, and this can potentially cost a city’s renters millions.

Other factors in rising prices make this a tricky knot to untangle. For example, do the AirBnBs or other signs of gentrification come first? There hasn’t been widespread data to answer that yet definitively, but there is, at least, a relationship between the supply of short-term units and gentrifying neighborhood changes.

But it’s hard to prove their positive impacts in available data. For example, when surveying users, only 2% to 8% of respondents said they would not have gone on the trip anyway, using hotels or other resources if AirBnBs weren’t available.

 

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