4 ms·

It removes liquidity from housing market, by repurposing flats/houses into hotels.

zbrozek 4y ago
It's creating liquidity, just not the kind you value. It's liquidity of short term housing rather than long term housing.
- tekknik 4y ago
  Ok, then more accurately it’s moving liquidity. The next question is which is more valuable to society?
  - zbrozek 4y ago
    The United States is short O(10M) housing units[0], primarily due to anti-construction policies. Airbnb has O(100k) listings[1] in the US. Banning short-term rentals is a 1% solution. That's a policy distraction, not a useful lever to pull. [0] https://www.theatlantic.com/ideas/archive/2022/11/us-housing-gap-cost-affordability-big-cities/672184/ https://www.theatlantic.com/ideas/archive/2022/11/us-housing... [1] https://www.stratosjets.com/blog/airbnb-statistics/ https://www.stratosjets.com/blog/airbnb-statistics/
    - miguelazo 4y ago
      There are plenty of empty luxury condos in every major city. They mostly serve as bank accounts for foreign investors. There's plenty of construction, just the wrong type.
      - zbrozek 4y ago
        Maybe so, but can you show any data that it's a significant or meaningful problem and not a visible scapegoat? The data I found (above) makes clear that deleting the short-term rental market would not even dent the housing shortage problem in the United States. I could believe (and maybe someone in this thread has data!) that in some extremely over-constrained markets that units are disproportionately used for short-term rentals. But I haven't seen any numbers. And in those cases, you still should be building homes to solve the root cause problem. Americans persistently seem to want to find any reason at all to absolve themselves of responsibility for the housing crisis. It's investors! It's short-term rentals! It's corporate landlords! But it's never the locals who oppose construction.
        tekknik 4y ago
        Adding more houses to the market certainly will decrease pricing pressure. Nobody said banning Airbnb was suddenly going to make housing affordable but decrease prices. And my question remains, which is more valuable to society, short term rentals or homes?
        zbrozek 4y ago
        It's not a zero-sum game. You can have both, but you need to build enough to have it. Regulating the use of a thing is a mark of market failure. How would you feel if the government told you that you could only use a pencil for writing because that has more social value than its use in making a model log cabin? You're also failing to process my point: that banning short-term rentals is an ineffective lever, not that it won't have an epsilon of impact. Yes, you will increase supply by a tiny amount relative to the shortage. It will have near-zero pricing impact because the magnitude pales against the problem.
        miguelazo 4y ago
        No, we have been ignoring your point because it’s one of those Econ 101 world views based on assumptions that have no basis in the real world and actual human behavior. You can’t look at the number of Airbnb rentals and conclude it’s not having a significant impact on the market simply based on the raw number of units. What we know from all systems theory is that a small portion of things has the majority of the effect. In this case, short term rentals are very likely setting the upper bounds of the pricing range. https://time.com/6223185/airbnbs-empty-short-term-rentals/ https://time.com/6223185/airbnbs-empty-short-term-rentals/
        zbrozek 4y ago
        Actual research suggests the effect is tiny. "At the median owner-occupancy rate zip code, we find that a 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices." https://pubsonline.informs.org/doi/10.1287/mksc.2020.1227 https://pubsonline.informs.org/doi/10.1287/mksc.2020.1227
- miguelazo 4y ago
  Liquidity for short term housing is valuable to who? Do you think most people here or otherwise care about speculators? We don't.

It's creating liquidity, just not the kind you value. It's liquidity of short term housing rather than long term housing.

tekknik 4y ago
Ok, then more accurately it’s moving liquidity. The next question is which is more valuable to society?
- zbrozek 4y ago
  The United States is short O(10M) housing units[0], primarily due to anti-construction policies. Airbnb has O(100k) listings[1] in the US. Banning short-term rentals is a 1% solution. That's a policy distraction, not a useful lever to pull. [0] https://www.theatlantic.com/ideas/archive/2022/11/us-housing-gap-cost-affordability-big-cities/672184/ https://www.theatlantic.com/ideas/archive/2022/11/us-housing... [1] https://www.stratosjets.com/blog/airbnb-statistics/ https://www.stratosjets.com/blog/airbnb-statistics/
  - miguelazo 4y ago
    There are plenty of empty luxury condos in every major city. They mostly serve as bank accounts for foreign investors. There's plenty of construction, just the wrong type.
    - zbrozek 4y ago
      Maybe so, but can you show any data that it's a significant or meaningful problem and not a visible scapegoat? The data I found (above) makes clear that deleting the short-term rental market would not even dent the housing shortage problem in the United States. I could believe (and maybe someone in this thread has data!) that in some extremely over-constrained markets that units are disproportionately used for short-term rentals. But I haven't seen any numbers. And in those cases, you still should be building homes to solve the root cause problem. Americans persistently seem to want to find any reason at all to absolve themselves of responsibility for the housing crisis. It's investors! It's short-term rentals! It's corporate landlords! But it's never the locals who oppose construction.
      - tekknik 4y ago
        Adding more houses to the market certainly will decrease pricing pressure. Nobody said banning Airbnb was suddenly going to make housing affordable but decrease prices. And my question remains, which is more valuable to society, short term rentals or homes?
        zbrozek 4y ago
        It's not a zero-sum game. You can have both, but you need to build enough to have it. Regulating the use of a thing is a mark of market failure. How would you feel if the government told you that you could only use a pencil for writing because that has more social value than its use in making a model log cabin? You're also failing to process my point: that banning short-term rentals is an ineffective lever, not that it won't have an epsilon of impact. Yes, you will increase supply by a tiny amount relative to the shortage. It will have near-zero pricing impact because the magnitude pales against the problem.
        miguelazo 4y ago
        No, we have been ignoring your point because it’s one of those Econ 101 world views based on assumptions that have no basis in the real world and actual human behavior. You can’t look at the number of Airbnb rentals and conclude it’s not having a significant impact on the market simply based on the raw number of units. What we know from all systems theory is that a small portion of things has the majority of the effect. In this case, short term rentals are very likely setting the upper bounds of the pricing range. https://time.com/6223185/airbnbs-empty-short-term-rentals/ https://time.com/6223185/airbnbs-empty-short-term-rentals/
        zbrozek 4y ago
        Actual research suggests the effect is tiny. "At the median owner-occupancy rate zip code, we find that a 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices." https://pubsonline.informs.org/doi/10.1287/mksc.2020.1227 https://pubsonline.informs.org/doi/10.1287/mksc.2020.1227
miguelazo 4y ago
Liquidity for short term housing is valuable to who? Do you think most people here or otherwise care about speculators? We don't.