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Housing prices are set on the margin. 20k to 40k units coming online for sale immediately would have a material impact on prices.
by JMTQp8lwXL 6y ago
Housing prices are set on the margin. 20k to 40k units coming online for sale immediately would have a material impact on prices.
- JMTQp8lwXL 6y agoA corollary to this: a stock price can double with only a relatively small number of shares changing hands, proportional to the total number of existing shares. Comparing the number of Airbnb units to the number of housing units citywide can lead to the wrong implication, even if that percentage is low.
- pembrook 6y agoCertainly it would, temporarily. Like placing a large buy order on a stock. But prices would quickly normalize since it would be a one time thing. Supply would quickly tighten up again and prices would resume the march upward. And even the short term downward price pressure wouldn’t affect prices by much. We’re not talking the 50%+ drops that would be needed to make housing in the area “affordable” relative to incomes—-as it was for at least half of the last century. Also important to remember, many of those Airbnb’s would not be legally zoned for permanent occupancy.