What is believed to be the first-ever study of Airbnb’s effects on house prices – not just rents – suggests the service has increased home values in some cities.
The research was conducted in the US by the academics at University of California Los Aangeles, the University of Southern California’s Marshall School of Business, and the National Bureau of Economic Research.
Although a paper containing the results has not been finalised, a version seen by the Wall Street Journal suggests that after analysing 100 major urban areas it appears “a 10 per cent increase in Airbnb listings [between 2012 and 2016] leads to a 0.42 per cent increase in rents and a 0.76 per cent increase in house prices.”
One of the academics behind the research told the WSJ that while the Airbnb-induced increases in both rents and house prices appeared small, they were a significant proportion of the overall increase in rents (2.2 per cent) and house prices (4.8 per cent) in those same locations over the same period.
The academic quoted in the piece – Edward Kung, an assistant professor of economics at the University of California Los Angeles – said that Airbnb took supply out of the long-term rental market and reallocated it to short lets for tourists and temporary visitors.
“This reduces the supply of long-term rental units and increases the price for residents looking for long-term housing. Home prices rise with rents. And above and beyond that simple relationship, Airbnb enables homeowners to generate income from their property, making their homes even more valuable” he says.
The same article then quotes an Airbnb spokesman saying: “Airbnb makes housing more affordable—countless families depend on Airbnb to pay their rent and stay in their homes—and in an opinion survey, 95 per cent of economists and housing experts said they don’t believe home sharing has a significant impact on rents. The authors of this study agree that home sharing can provide important economic benefits for families and support smart rules that allow home sharing to continue.”
It’s a fascinating story and reflects many of the same arguments now taking place over Airbnb and similar platforms and their effects on the UK housing and rental sectors.