GASPING FOR AIRBNB

Gasping for Airbnb

8/16/2020

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"Lisbon turning Airbnb-style rentals into homes for key workers."

The headline above is from The Independent July 6, 2020 report. European cities are thinking about what their urban centers should look like in a post Covid 19 environment in terms of affordable accommodation and access to services for their front line workers who have been pushed into the suburbs and long commutes by the expansion of Airbnb into the core tourist areas where prior to the global suppression of interest rates, affordable housing used to exist.

Demographia defines affordability:

Affordability is the ability for any urban household to be able to rent a dwelling for less than a 25% of its monthly income, or to buy one for less than about three time its yearly income. The mobility and affordability objectives are tightly related. A residential location that only allows access to only a small segment of the job market in less than an hour commuting time has not much value to households, even if it is theoretically affordable.

Here are some quotes from Fernando Medina the Mayor of Lisbon from the July 26, 2020 report from The Independent:

> More than a third of properties in the centre of the city (Lisbon) are currently taken up by holiday lettings.

> Tourist rentals had pushed up (Lisbon) property prices in recent years and driven out essential workers and their families.

> (Lisbon) authorities will offer to pay landlords in return for renting "safe homes" as affordable housing for workers including hospital staff and teachers.

> We want to bring the people who are Lisbon’s lifeblood back to the centre of the city as we make it greener, more sustainable and ultimately, a better place to both live and visit.

> With many more people likely to be permanently working from home, it makes sense for more Lisboetas to swap the suburbs for the city where they can easily access public transport, services and take advantage of festivals and concerts.

> From Melbourne to Paris, the tide is turning against urban sprawl and back to revitalised city centres where residents can reach key services, like doctors, schools and shops all within a 20-minute walk.

> As Lisbon rapidly transformed into a tourist destination over the last decade, the number of Airbnb units skyrocketed — driving up the cost of housing, and pushing longtime residents out of the city center. When 2020 started, many neighborhoods were more than one third short-term housing; in the worst-affected part of town, around 55 percent of residential units had been converted to makeshift hostels and hotels. Then the virus came, and all the rentals dried up. Now Lisbon is taking advantage of that situation, in order to push some of these units back into the long-term housing market. The city government is renting empty apartments directly from property owners, and then turning around to rent them to Portuguese workers and students at subsidized rates.

Here are some quotes from the August 13, 2020 NYmag.com Intelligencer report "The European Cities Using the Pandemic As a Cure for Airbnb"

> Now Lisbon is taking advantage of that situation, in order to push some of these units back into the long-term housing market. The city government is renting empty apartments directly from property owners, and then turning around to rent them to Portuguese workers and students at subsidized rates.

> Lisbon may take up to 2,000 homes off the short-term market, but could expand further... the new contracts are for at least five years, and no one will be asked to pay more than 30 percent of their monthly income on rent.

> Last year, the Irish government passed legislation strictly regulating Airbnb-style rentals... this year properties entering the long-term rental market increased as much as 64 percent in some neighborhoods in the capital.

> In Paris, Mayor Anne Hidalgo has promised a referendum on the future of short-term rental properties in the French capital. “There are about 30,000 Airbnb-type rentals in Paris, the task is to get them back.”

> Since 2016, it has been legal for cities in Spain’s Catalonia region to take over properties that have not had tenants for over two years... in July, the city of Barcelona (the capital of Catalonia) informed the owners of 194 apartments that they better find tenants soon; if not, the government could take them over and turn them into affordable housing.

> Per square mile, Barcelona has the most Airbnb properties in Europe and Lisbon is No. 2.

> In Rome, a group of activists and researchers at the LUISS Guido Carlo University is looking to promote the “Barcelona model,” as part of a multi-pronged approach to make Italian cities more democratic and inclusive. The city center feels desolate at the moment, because all the properties dedicated to Airbnb rentals as well as many of the urban homes of the wealthy, who have houses elsewhere, are empty... Airbnb has disrupted the housing supply in Italy; there are almost a half a million units dedicated to this kind of short-term rental and COVID-19 has exposed the problem of urban inequalities even more starkly.

Here are some quotes from the April 1, 2020 Bloomberg report "Will Airbnb Become Obsolete After the Coronavirus?"

> Over the past decade, the app that connects fly-by-night tourists and short-term renters to “cozy” lofts and five-star “experiences” morphed into a gig-economy nightmare for cities like Paris, Amsterdam and Barcelona.

> (Now) global tourist traps are being slammed shut, and the ecosystem that sprang up around them is falling apart — including Airbnb. Apartments once reserved for well-heeled tourists have seen bookings slump anywhere from 41% to 96%.

> Paris has 100,000 empty homes and 100,000 second homes, according to the mayor’s office, fueling a sense of social injustice.

> "Short-term rentals have had a disastrous impact on cities’ rental markets,” McGill University’s David Wachsmuth told The Intelligencer last month. Will a post-Covid-19 society really want that back?

> Already, in China, the slow return of tourism is — understandably — skewed towards domestic, not international, trips. If France loses a chunk of its 2 million annual Chinese visitors and their 4 billion euros ($4.4 billion) in associated spending, that’s a rough prospect for rentals.

> How we work, and travel for work, could also change long-term. Lockdowns in Italy and France have already seen irresponsible city-dwelling Northerners descend on family homes and rural towns in the south. They might stay there if working from home turns out to be a durable, safe option as countries ramp up tests and vaccine research.

> This crisis may be a chance for a more balanced recovery than simply a return to the norms of over-valued, over-crowded and over-polluted cities.

Santa Monica has effectively wiped out 80% of its Airbnb listings...
Source: Investopedia, March 8, 2020

Santa Monica has effectively wiped out 80% of its Airbnb listings by instituting the toughest regulations on short-term rentals in the U.S. The southern California city said it was spurred by overall increases in housing prices and dwindling housing supply. The new regulations, which have been effective since June 2015, require anyone putting a listing on Airbnb in Santa Monica to live on the property during the renter’s stay, register for a business license, and collect a 14% occupancy tax from users that will be payable to the city. In 2019, the City of Santa Monica reached an agreement with Airbnb in which the company agreed to remove illegal short-term listings from its website. As of 2019, the city has only 351 short-term rental properties, most of which are listed on Airbnb.