9 ms·

It converts long term housing stock into short term housing, which benefits tourists with cheaper prices and increases the price for residents since both are co

by reza_n 9y ago

It converts long term housing stock into short term housing, which benefits tourists with cheaper prices and increases the price for residents since both are competing for the same units. Basically, tourists are getting a free ride on the backs of residents. Its always been the other way around, tourists pay extra taxes and fees which go back to the city (and residents) and entrepreneurs build hotels which once again benefit the city (and residents). Can't think of many arguments where tourists should be given cheaper housing rights over residents.

anindha 9y ago
This is spot on. Also having a hotel next door is easy to spot when you are looking for a new place. I think Airbnb is a good idea with regulation that limits the number of weeks you can rent out your place.
- tedmiston 9y ago
  I believe this is how it works in SF already, something like one can host up to 90 days per year with them not present. I don't think there's a limit if they are present.
smsm42 9y ago
I remember NY housing prices were not so friendly way before Airbnb. In fact, a number of sitcoms set in New York feature the topic prominently. Is there any data that Airbnb made the problem substantially worse?
- user5994461 9y ago
  Housing is a disaster in every major city and price have been going up almost 10% a year for a while. AirBnb hardly has any influence on that.
  - RodericDay 9y ago
    Montreal is amazing, actually. Thanks, universally-slandered rent-control! Living in this city makes me realize how cargo-culty a lot of HN economics is.
    - smsm42 9y ago
      A lot of cities have or had rent control, usually with disastrous results. What makes Montreal different (non-rhetorical question)?
      - RodericDay 9y ago
        idk, I don't study the topic in-depth. However, I live here, and it's incredible. Every time some economist (or, worse, economics enthusiast) makes a ludicrous claim like "rent control is objectively and universally agreed upon to be bad" I just laugh. Montreal routinely ranks as one of the best cities in the planet (and I agree with that assessment), so clearly it's not as black-and-white as it's made seem.
gist 9y ago
Exactly. And to further your point (in case it's not clear) tenants renting out on airbnb allows landlords to increase rent at the inconvenience of the tenant. So if a landlord allows this and the tenant gets extra income part of that extra income is passed on to the landlord as extra rent or the tenant finds a rent increase acceptable if they are able to rent out their unit.
jseliger 9y ago
The big problem here is really market distortions caused by zoning: https://news.ycombinator.com/item?id=14942019 https://news.ycombinator.com/item?id=14942019
nostrademons 9y ago
The economic response to this (and I'm not saying I agree...I don't have a horse in this race either way) is that a tourist's willingness to pay for accommodation exceeds a resident's, and so they should get the apartment. And the apartment owner can turn around and capture this surplus by renting out their accommodations to tourists on AirBnB. The market price for housing is artificially low in most municipalities because the market is limited to people within geographical range of the apartment; open that market up globally and you'll find a vacationer who values it more than any resident does, and so the resident can capture the surplus to renting it to the vacationer. The neat property of this business model is that it's actually viral: the way to avoid getting screwed by AirBnBers next door is to rent your place out on AirBnB too, and then go stay in somebody else's AirBnB. It can be interesting to try and consider the endgame of various startups' business models, basically what the world would look like if the economic inefficiency they exploit is arbitraged away entirely. YCombinator is a world where everyone is an entrepreneur, but the returns to entrepreneurship aren't much better than having a regular job, and everybody works much harder. Google is "information wants to be free", where everybody has full access to information and the market price of that is zero. Napster was that nobody would produce art or music; Facebook is that all socializing occurs online; Uber/DoorDash/PostMates and other sharing economy startups create a caste society where those without technical skills serve those who do. AirBnB's endgame is the destruction of the concept of residency. If they succeed in their mission and arbitrage away all inefficiencies in the housing market, they effectively institutionalize the digital nomad lifestyle, where everybody can live and work anywhere in the globe, and yet never has a permanent home. I'll let other people judge whether that's a good or bad thing. To me, most social institutions are pretty arbitrary anyway, and I have confidence I could adapt to whatever world comes next. I'll say that they're riding a really powerful trend that's independent of any one corporation or individual: the Internet has made nearly all markets global, and so the idea of being tied to a particular place is becoming increasingly quaint for many people.
- plandis 9y ago
  A society where only a select few own property? I believe Europe tried that for 100's of years. I doubt you'd find many people willing to go back to serfdom.

by reza_n 9y ago

anindha 9y ago

This is spot on. Also having a hotel next door is easy to spot when you are looking for a new place. I think Airbnb is a good idea with regulation that limits the number of weeks you can rent out your place.

tedmiston 9y ago
I believe this is how it works in SF already, something like one can host up to 90 days per year with them not present. I don't think there's a limit if they are present.

smsm42 9y ago

I remember NY housing prices were not so friendly way before Airbnb. In fact, a number of sitcoms set in New York feature the topic prominently. Is there any data that Airbnb made the problem substantially worse?

user5994461 9y ago
Housing is a disaster in every major city and price have been going up almost 10% a year for a while. AirBnb hardly has any influence on that.
- RodericDay 9y ago
  Montreal is amazing, actually. Thanks, universally-slandered rent-control! Living in this city makes me realize how cargo-culty a lot of HN economics is.
  - smsm42 9y ago
    A lot of cities have or had rent control, usually with disastrous results. What makes Montreal different (non-rhetorical question)?
    - RodericDay 9y ago
      idk, I don't study the topic in-depth. However, I live here, and it's incredible. Every time some economist (or, worse, economics enthusiast) makes a ludicrous claim like "rent control is objectively and universally agreed upon to be bad" I just laugh. Montreal routinely ranks as one of the best cities in the planet (and I agree with that assessment), so clearly it's not as black-and-white as it's made seem.

gist 9y ago

Exactly. And to further your point (in case it's not clear) tenants renting out on airbnb allows landlords to increase rent at the inconvenience of the tenant. So if a landlord allows this and the tenant gets extra income part of that extra income is passed on to the landlord as extra rent or the tenant finds a rent increase acceptable if they are able to rent out their unit.

jseliger 9y ago

The big problem here is really market distortions caused by zoning: https://news.ycombinator.com/item?id=14942019 https://news.ycombinator.com/item?id=14942019

nostrademons 9y ago

The economic response to this (and I'm not saying I agree...I don't have a horse in this race either way) is that a tourist's willingness to pay for accommodation exceeds a resident's, and so they should get the apartment. And the apartment owner can turn around and capture this surplus by renting out their accommodations to tourists on AirBnB. The market price for housing is artificially low in most municipalities because the market is limited to people within geographical range of the apartment; open that market up globally and you'll find a vacationer who values it more than any resident does, and so the resident can capture the surplus to renting it to the vacationer. The neat property of this business model is that it's actually viral: the way to avoid getting screwed by AirBnBers next door is to rent your place out on AirBnB too, and then go stay in somebody else's AirBnB. It can be interesting to try and consider the endgame of various startups' business models, basically what the world would look like if the economic inefficiency they exploit is arbitraged away entirely. YCombinator is a world where everyone is an entrepreneur, but the returns to entrepreneurship aren't much better than having a regular job, and everybody works much harder. Google is "information wants to be free", where everybody has full access to information and the market price of that is zero. Napster was that nobody would produce art or music; Facebook is that all socializing occurs online; Uber/DoorDash/PostMates and other sharing economy startups create a caste society where those without technical skills serve those who do. AirBnB's endgame is the destruction of the concept of residency. If they succeed in their mission and arbitrage away all inefficiencies in the housing market, they effectively institutionalize the digital nomad lifestyle, where everybody can live and work anywhere in the globe, and yet never has a permanent home. I'll let other people judge whether that's a good or bad thing. To me, most social institutions are pretty arbitrary anyway, and I have confidence I could adapt to whatever world comes next. I'll say that they're riding a really powerful trend that's independent of any one corporation or individual: the Internet has made nearly all markets global, and so the idea of being tied to a particular place is becoming increasingly quaint for many people.

plandis 9y ago
A society where only a select few own property? I believe Europe tried that for 100's of years. I doubt you'd find many people willing to go back to serfdom.