Airbnb Can Push Rent Growth: Study
Digested from Fast Company
Short-term rentals push rates in markets where a lot of long-term rentals are pulled into the short-term pool.
When the number of Airbnb listings increase in your neighborhood, there is a good chance your apartment community will enjoy a small benefit.
A new report from researchers at MIT, UCLA and USC found that a 10 percent increase in Airbnb listings would lead to a 0.39 percent increase in rents and a 0.64 percent increase in home prices in a ZIP code on average.
MIT Research Assistant Kyle Barron, UCLA Professor Edward Kung and USC Professor Davide Proserpio, scraped data from Zillow, Airbnb, the Census Bureau and Google Trends to understand how Airbnb affects rents and values.
“They found that the percent of non-owner-occupied units listed in a given region determines the rate at which rents will increase,” writes Fast Company’s Ruth Reader. “Rents rise more heavily when there is a preponderance of home listings that the owner is not living in. More specifically, the study indicates that rental rate increases are tied to the number of landlords taking long-term inventory and moving it to short-term markets like Airbnb or VRBO.”
Tourism-heavy markets, like Honolulu or Los Angeles, are more likely to have short-term rentals, according to the report.
“The popularity of these places with tourists means that [owners] are more likely to make that switch to short-term rentals,” Reader writes. “It is this very behavior that concerns lawmakers as they think about how housing is allocated in the future.”