6 ms·

Airbnb rental revenues have plunged in some parts of the US, this chart suggests

49 points by pg_1234 3y ago

malermeister 3y ago
Good. Airbnb messes up the rental market for locals. Like all "gig economy" services, it exploits legal loopholes to avoid proper classification and extract value from the commons.
- AbrahamParangi 3y ago
  I don’t know, tourists aren’t a loss for the local economy, they’re pretty much always a huge win. You may not want them but I don’t know that it’s appropriate to think of it as extracting value from the commons.
  - kevinh 3y ago
    We already have a mechanism for handling tourists - hotels.
    - malermeister 3y ago
      Yup, and they are the regulated mechanism that avoids rents skyrocketing that airbnb is trying to circumvent per my original post.
- codetrotter 3y ago
  Conversely I wonder what the world would look like if it was illegal for people and businesses to rent out housing. Imagine a world where every family was allowed to own a single house or apartment only. All rental properties were owned by the city or whatever other local government, and housing for rental was built to be sustainable and non-profit. I wonder if more people would be able to buy a house/apartment for themselves and their family in such a world.
  - throwway120385 3y ago
    I feel like constraining access in this way would lead to some pretty nasty second-order effects if you didn't also redistribute a bunch of wealth from the 1% to the renters. Also with all rental properties being government-owned there would be zero uniqueness and everyone would be forced to make due with whatever the government thought they needed. A good example of this is old Soviet-style tower blocks, where no matter how big your family you get the same size apartment. At least with the current system, people who want to rent detached homes are able to. Your system would suffer from the alternating cycles of austerity that seem to plague governments and the tower blocks would gradually lose all amenities and everything would become exactly the same for the same price. I'm not sure that's better than the current system. A better system would just prohibit private equity from buying real estate and renting it. I think a lot of the housing price increases are due to PE firms buying rental houses and then farming their management out to local management companies.
    - malermeister 3y ago
      > Also with all rental properties being government-owned there would be zero uniqueness and everyone would be forced to make due with whatever the government thought they needed. A good example of this is old Soviet-style tower blocks, where no matter how big your family you get the same size apartment. That part is just not true. See Vienna. This is public housing: https://www.wien.info/en/sightseeing/sights/hundertwasser-house-vienna-348464 https://www.wien.info/en/sightseeing/sights/hundertwasser-ho... So is this: https://m.youtube.com/watch?v=d6DBKoWbtjE https://m.youtube.com/watch?v=d6DBKoWbtjE
- mupuff1234 3y ago
  They also hurt the fabric of the neighborhood. I'd rather not live next to a revolving door of strangers.
- assvdsevavs 3y ago
  > Airbnb messes up the rental market for locals. Like all "gig economy" services, it exploits legal loopholes to avoid proper classification and extract value from the commons. Interesting thing about this argument is, I feel like this assumes there are no benefits of short term rentals for locals. Specially, I see this closely in a small tourist town (not sure how it changes with a big city), but in a small tourist town there's limited supply of hotels and they are generally much more expensive. If you allow airbnb, some home owners prefer short term rentals and so affects supply for long term rentals but, that also means it benefits local home owners, also generate more taxes as most places now have higher taxes for short term rentals, which one can argue is used back to fund stuff in the local community. Also in a small town, many businesses depend on the tourists, so more tourists mean more benefit for local businesses and where locals are employed. So, keeping long term rental prices down for locals by suppressing short term rentals comes at an expense of locals, isn't it?
  - malermeister 3y ago
    It benefits a subsection of locals (the ones working in tourism or renting out their apartments) to the detriment of the rest of them. You can see this play out in cities like Barcelona: https://www.newyorker.com/magazine/2019/04/29/the-airbnb-invasion-of-barcelona https://www.newyorker.com/magazine/2019/04/29/the-airbnb-inv...
    - assvdsevavs 3y ago
      > benefits a subsection of locals .... to the detriment of the rest of them That was my point, the "rest of them" is another subsection of the same local population. I am not sure I understand why some think benefiting one subsection is OK while not the other. Anyway, this entire comment sub thread seems to head towards incorrect/inadequate incentives/regulation. Seems like fixing that is perhaps a better course than to throw out an entire industry that obviously many locals and visitors want and use.
      - malermeister 3y ago
        The issue is that the benefit that subsection gets is parasitic, by damaging the host society for their own benefit. I'm not against them benefiting. I'm against them driving up rents and driving people out of their homes to do so.
Solvency 3y ago
How ironic, because the Airbnb cleaning fees and requisite cleaning chore lists are skyrocketing.
vorpalhex 3y ago
These revenues are insane and I'm glad they are dropping. Hopefully this takes strain off housing prices as some of these properties get sold. Short term rentals should be heavily taxed since they are a business, not a home.
- arebop 3y ago
  There aren't many localities in which AirBnBs are a significant fraction of the real estate market. For example, San Francisco sees 40k tourists/day vs. a population of 800k. That's just 5%, and bear in mind SF is the cultural/tourism center of the SFBA with a population of 8000k. Prohibit short term rentals and convert all the hotels to housing while you're at it and you still won't move the needle much on housing prices.
  - wcarron 3y ago
    There Are many localities where AirBnbs and other STRs make a significant proportion of housing. The town 45 minutes from me is over 15% AirBnbs/STRs. My town is better, but still has too many STRs.
    - arebop 3y ago
      And in Venice Italy it is more like 67%. But this is not common.
      - wcarron 3y ago
        It is common, you just don't want to admit it. It's all over the western US and many, many towns have been impacted. Palm Springs and Joshua Tree aggressively responded for a reason. Because STRs, particularly in Jtree, were inflating home prices at an extraordinary rate and forcing long term residents out.
  - gmarx 3y ago
    There are many situations in economics in which the marginal effects are quite large especially WRT setting prices. I haven't read or done an analysis but I would never assume that 5% of a market has a 5% influence only in determining prices
binarysolo 3y ago
Can't comment on the macroeconomic trends, but personally as a consumer, hotels are more attractive than AirBNBs for <1-week stays due to cleaning fee and chore lists ($250 cleaning fee per stay, still have to clean up the house and pack the garbage out). Most of my travel is solo for work for 2-3 days so this nudges me towards hotels. For 1+ week stays AirBNBs make more sense (family vacay, larger house with children), though it seems like the house owner lists the same house on VRBO and for whatever reason prices it slightly cheaper there, so I just book it at the cheaper place.
- carabiner 3y ago
  I've stayed in 30+ airbnb's around the world and I've never encountered the cleaning fee on top of a chore list that is so reviled on reddit and twitter. The only time I had to clean, the host just informed me that there wasn't a cleaning fee so I'd have to do it myself. Still sucked (went out and bought cleaning supplies and took a whole day) but seemed fair.
  - hattar 3y ago
    Interesting. I travel mainly in the US and of the approximately 10 visits I can’t remember an instance where I didn’t pay a cleaning fee while also dealing with a chore list. It’s pretty sharp in my mind because it always frustrates me so much.
    - carabiner 3y ago
      Yeah most of mine were in San Jose, CA, but this was 4 years ago and they were single rooms (not an entire apartment), so I wonder if the practice has grown since then. I still don't like airbnb for other reasons: broken stuff (even in well reviewed places), worsens the housing crisis, poor quality but nice looking furniture. The furniture is "bony."
  - square_usual 3y ago
    It is very much a US thing. I've stayed in AirBNBs in India and the US, and a majority of the AirBNBs I've stayed in the US have a cleaning fee, while none of the ones I stayed in India did.
draw_down 3y ago
Everyone knows about cleaning the dishes and the fees etc. But at least part of this is driven by bans. Municipalities that banned airbnb (or partial bans such as not allowing the entire dwelling for short term rental) were among those with the biggest drops in revenue, as you’d expect.
avgDev 3y ago
I hate Airbnb. I don't think I ever had an excellent rental experience. There is always something broken. Something not as advertised. Pictures are often deceiving. It is often difficult to deal with the host, as some are trying to make it their primary income and managing several properties. The chore lists are pathetic. I would rather pay more and get a consistent experience from a hotel/resort.
- jfghi 3y ago
  Exactly, it’s a gig-career injected with a high level of entitlement and disdain for customer.
  - stemlord 3y ago
    A gig landlord
- RhodesianHunter 3y ago
  I've had the exact opposite experience. I always book from well reviewed hosts and have never had a bad stay. We always travel with our kids, so multiple attached bedrooms is important, and something you pretty much cannot find in hotels without spending obscene amounts. Most hotels won't even guarantee consecutive rooms, let alone attached.
  - welldoneator 3y ago
    Just dealt with this recently and up until then mostly had great experiences with hosts. When something goes wrong (ex: had a family emergency that blew up my travel plans a couple of weeks out), any refunds or resolutions are at the discretion of a host who is directly financially affected by the outcome. So there's never an incentive to be reasonable, and they'll often get hostile or combative - in this recent case pretty much immediately. I was able to easily alter/refund every single component of my trip, including a hotel stay, but couldn't do anything about the AirBnB because the host dug his heels in and started getting hostile.
- throwway120385 3y ago
TheCaptain4815 3y ago
I've seen this chart being passed around, but I'd like to see the numbers comparing 2019 to 2023. I have a feeling the revenue would still be 25%+ higher today than just 4 years ago. They even mention how much more people are spending on vacations compared to 2019.
monero-xmr 3y ago
Look up Blueground for longer month-to-month stays https://www.theblueground.com/ https://www.theblueground.com/ They contract direct with owners and the experience is much more streamlined. Otherwise we only do hotels. Airbnb is dead to me
mbesto 3y ago
First, let's look at the two people in question: > The #1 Real Estate Channel on YouTube with over 4 Million Monthly Views. vs > Chief Economist, SVP of Analytics @AirDNA, tracking performance and explaining trends in short-term rentals Gerli is clearly incentivized by "shock value" content (he's a YouTuber) and Lane is incentivized by telling people the market is okay, however I'm inclined to believe Lane on this one. I've also used both AllTheRooms and AirDNA and AirDNA appears much more accurate (YMMV). Second, lots of those Top 10 destinations are bachelor party destinations. Nashville, Austin, PHX/Scottsdale come to mind. These were once lucrative ABNB destinations ("8 bros in a shared house"), because large groups get better economics, easier communications/logistics, etc. So, it's no surprise with higher inventory of people chasing that demand that prices will eventually come down and settle.
DueDilligence 3y ago
[dead]
dghughes 3y ago
Here is Canada it seems identity thieves are using AirBnB to steal homes. Probably not specific to AirBnB though. >Police allege MacDougall used a fake name to rent a home on an online short-term rental app and obtained the homeowner's identity information while inside. According to police, MacDougall then allegedly used that information to impersonate the homeowner and secure a mortgage from a private lender, making away with the proceeds. https://www.cbc.ca/news/canada/toronto/short-term-rental-mortgage-fraud-1.6885034 https://www.cbc.ca/news/canada/toronto/short-term-rental-mor...
- Scoundreller 3y ago
  Sadly, this offence seems easiest to pull off in airbnbs that are genuine home-sharing where you are renting from an actual resident that is away for short periods of time (or just relocates with family during bookings), rather than pure “buy-to-airbnb” properties with better security and that kind of documentation wouldn’t be present. The former group effectively improves local housing affordability by decreasing the latter or pushing developers towards residential construction instead of hotel construction.
chx 3y ago
> here's how platforms die: First, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves. Then, they die. Why would enshittification not apply to airbnb? Of course it does. The honeymoon (fed printing money) is over, the party is over. 2022 was the first year ever airbnb had a positive net income, such things don't come easy.
- deleted 3y ago
  [deleted]
irrational 3y ago
AirBnbs were great years ago, but the fees are often more than the rental price these days. We pretty much stick to hotels and Bed & Breakfasts these days.
iJohnDoe 3y ago
I can’t believe anyone would stay in an AirBnB after all the reports of hidden cameras. For me personally, it’s not worth the risk even if the risk is minimal. Plus, all the cleaning fees and other things people have mentioned. Also, it seems like some hosts are not a good fit to be in the AirBnB business. The hosts that are super paranoid about every guest or what is happening in their home - and are the type to use cameras or stop by unannounced, etc. It’s like an Uber driver who is ultra protective of their car. They shouldn’t be in the Uber business. There is a balance and some just aren’t suited to be an AirBnB hosts.

49 points by pg_1234 3y ago

Good. Airbnb messes up the rental market for locals. Like all "gig economy" services, it exploits legal loopholes to avoid proper classification and extract value from the commons.

AbrahamParangi 3y ago
I don’t know, tourists aren’t a loss for the local economy, they’re pretty much always a huge win. You may not want them but I don’t know that it’s appropriate to think of it as extracting value from the commons.
- kevinh 3y ago
  We already have a mechanism for handling tourists - hotels.
  - malermeister 3y ago
    Yup, and they are the regulated mechanism that avoids rents skyrocketing that airbnb is trying to circumvent per my original post.
codetrotter 3y ago
Conversely I wonder what the world would look like if it was illegal for people and businesses to rent out housing. Imagine a world where every family was allowed to own a single house or apartment only. All rental properties were owned by the city or whatever other local government, and housing for rental was built to be sustainable and non-profit. I wonder if more people would be able to buy a house/apartment for themselves and their family in such a world.
- throwway120385 3y ago
  I feel like constraining access in this way would lead to some pretty nasty second-order effects if you didn't also redistribute a bunch of wealth from the 1% to the renters. Also with all rental properties being government-owned there would be zero uniqueness and everyone would be forced to make due with whatever the government thought they needed. A good example of this is old Soviet-style tower blocks, where no matter how big your family you get the same size apartment. At least with the current system, people who want to rent detached homes are able to. Your system would suffer from the alternating cycles of austerity that seem to plague governments and the tower blocks would gradually lose all amenities and everything would become exactly the same for the same price. I'm not sure that's better than the current system. A better system would just prohibit private equity from buying real estate and renting it. I think a lot of the housing price increases are due to PE firms buying rental houses and then farming their management out to local management companies.
  - malermeister 3y ago
    > Also with all rental properties being government-owned there would be zero uniqueness and everyone would be forced to make due with whatever the government thought they needed. A good example of this is old Soviet-style tower blocks, where no matter how big your family you get the same size apartment. That part is just not true. See Vienna. This is public housing: https://www.wien.info/en/sightseeing/sights/hundertwasser-house-vienna-348464 https://www.wien.info/en/sightseeing/sights/hundertwasser-ho... So is this: https://m.youtube.com/watch?v=d6DBKoWbtjE https://m.youtube.com/watch?v=d6DBKoWbtjE
mupuff1234 3y ago
They also hurt the fabric of the neighborhood. I'd rather not live next to a revolving door of strangers.
assvdsevavs 3y ago
> Airbnb messes up the rental market for locals. Like all "gig economy" services, it exploits legal loopholes to avoid proper classification and extract value from the commons. Interesting thing about this argument is, I feel like this assumes there are no benefits of short term rentals for locals. Specially, I see this closely in a small tourist town (not sure how it changes with a big city), but in a small tourist town there's limited supply of hotels and they are generally much more expensive. If you allow airbnb, some home owners prefer short term rentals and so affects supply for long term rentals but, that also means it benefits local home owners, also generate more taxes as most places now have higher taxes for short term rentals, which one can argue is used back to fund stuff in the local community. Also in a small town, many businesses depend on the tourists, so more tourists mean more benefit for local businesses and where locals are employed. So, keeping long term rental prices down for locals by suppressing short term rentals comes at an expense of locals, isn't it?
- malermeister 3y ago
  It benefits a subsection of locals (the ones working in tourism or renting out their apartments) to the detriment of the rest of them. You can see this play out in cities like Barcelona: https://www.newyorker.com/magazine/2019/04/29/the-airbnb-invasion-of-barcelona https://www.newyorker.com/magazine/2019/04/29/the-airbnb-inv...
  - assvdsevavs 3y ago
    > benefits a subsection of locals .... to the detriment of the rest of them That was my point, the "rest of them" is another subsection of the same local population. I am not sure I understand why some think benefiting one subsection is OK while not the other. Anyway, this entire comment sub thread seems to head towards incorrect/inadequate incentives/regulation. Seems like fixing that is perhaps a better course than to throw out an entire industry that obviously many locals and visitors want and use.
    - malermeister 3y ago
      The issue is that the benefit that subsection gets is parasitic, by damaging the host society for their own benefit. I'm not against them benefiting. I'm against them driving up rents and driving people out of their homes to do so.

Solvency 3y ago

How ironic, because the Airbnb cleaning fees and requisite cleaning chore lists are skyrocketing.

vorpalhex 3y ago

These revenues are insane and I'm glad they are dropping. Hopefully this takes strain off housing prices as some of these properties get sold. Short term rentals should be heavily taxed since they are a business, not a home.

arebop 3y ago
There aren't many localities in which AirBnBs are a significant fraction of the real estate market. For example, San Francisco sees 40k tourists/day vs. a population of 800k. That's just 5%, and bear in mind SF is the cultural/tourism center of the SFBA with a population of 8000k. Prohibit short term rentals and convert all the hotels to housing while you're at it and you still won't move the needle much on housing prices.
- wcarron 3y ago
  There Are many localities where AirBnbs and other STRs make a significant proportion of housing. The town 45 minutes from me is over 15% AirBnbs/STRs. My town is better, but still has too many STRs.
  - arebop 3y ago
    And in Venice Italy it is more like 67%. But this is not common.
    - wcarron 3y ago
      It is common, you just don't want to admit it. It's all over the western US and many, many towns have been impacted. Palm Springs and Joshua Tree aggressively responded for a reason. Because STRs, particularly in Jtree, were inflating home prices at an extraordinary rate and forcing long term residents out.
- gmarx 3y ago
  There are many situations in economics in which the marginal effects are quite large especially WRT setting prices. I haven't read or done an analysis but I would never assume that 5% of a market has a 5% influence only in determining prices

binarysolo 3y ago

Can't comment on the macroeconomic trends, but personally as a consumer, hotels are more attractive than AirBNBs for <1-week stays due to cleaning fee and chore lists ($250 cleaning fee per stay, still have to clean up the house and pack the garbage out). Most of my travel is solo for work for 2-3 days so this nudges me towards hotels. For 1+ week stays AirBNBs make more sense (family vacay, larger house with children), though it seems like the house owner lists the same house on VRBO and for whatever reason prices it slightly cheaper there, so I just book it at the cheaper place.

carabiner 3y ago
I've stayed in 30+ airbnb's around the world and I've never encountered the cleaning fee on top of a chore list that is so reviled on reddit and twitter. The only time I had to clean, the host just informed me that there wasn't a cleaning fee so I'd have to do it myself. Still sucked (went out and bought cleaning supplies and took a whole day) but seemed fair.
- hattar 3y ago
  Interesting. I travel mainly in the US and of the approximately 10 visits I can’t remember an instance where I didn’t pay a cleaning fee while also dealing with a chore list. It’s pretty sharp in my mind because it always frustrates me so much.
  - carabiner 3y ago
    Yeah most of mine were in San Jose, CA, but this was 4 years ago and they were single rooms (not an entire apartment), so I wonder if the practice has grown since then. I still don't like airbnb for other reasons: broken stuff (even in well reviewed places), worsens the housing crisis, poor quality but nice looking furniture. The furniture is "bony."
- square_usual 3y ago
  It is very much a US thing. I've stayed in AirBNBs in India and the US, and a majority of the AirBNBs I've stayed in the US have a cleaning fee, while none of the ones I stayed in India did.

draw_down 3y ago

Everyone knows about cleaning the dishes and the fees etc. But at least part of this is driven by bans. Municipalities that banned airbnb (or partial bans such as not allowing the entire dwelling for short term rental) were among those with the biggest drops in revenue, as you’d expect.

avgDev 3y ago

I hate Airbnb. I don't think I ever had an excellent rental experience. There is always something broken. Something not as advertised. Pictures are often deceiving. It is often difficult to deal with the host, as some are trying to make it their primary income and managing several properties. The chore lists are pathetic. I would rather pay more and get a consistent experience from a hotel/resort.

jfghi 3y ago
Exactly, it’s a gig-career injected with a high level of entitlement and disdain for customer.
- stemlord 3y ago
  A gig landlord
RhodesianHunter 3y ago
I've had the exact opposite experience. I always book from well reviewed hosts and have never had a bad stay. We always travel with our kids, so multiple attached bedrooms is important, and something you pretty much cannot find in hotels without spending obscene amounts. Most hotels won't even guarantee consecutive rooms, let alone attached.
- welldoneator 3y ago
  Just dealt with this recently and up until then mostly had great experiences with hosts. When something goes wrong (ex: had a family emergency that blew up my travel plans a couple of weeks out), any refunds or resolutions are at the discretion of a host who is directly financially affected by the outcome. So there's never an incentive to be reasonable, and they'll often get hostile or combative - in this recent case pretty much immediately. I was able to easily alter/refund every single component of my trip, including a hotel stay, but couldn't do anything about the AirBnB because the host dug his heels in and started getting hostile.
throwway120385 3y ago

TheCaptain4815 3y ago

I've seen this chart being passed around, but I'd like to see the numbers comparing 2019 to 2023. I have a feeling the revenue would still be 25%+ higher today than just 4 years ago. They even mention how much more people are spending on vacations compared to 2019.

monero-xmr 3y ago

Look up Blueground for longer month-to-month stays https://www.theblueground.com/ https://www.theblueground.com/ They contract direct with owners and the experience is much more streamlined. Otherwise we only do hotels. Airbnb is dead to me

mbesto 3y ago

First, let's look at the two people in question: > The #1 Real Estate Channel on YouTube with over 4 Million Monthly Views. vs > Chief Economist, SVP of Analytics @AirDNA, tracking performance and explaining trends in short-term rentals Gerli is clearly incentivized by "shock value" content (he's a YouTuber) and Lane is incentivized by telling people the market is okay, however I'm inclined to believe Lane on this one. I've also used both AllTheRooms and AirDNA and AirDNA appears much more accurate (YMMV). Second, lots of those Top 10 destinations are bachelor party destinations. Nashville, Austin, PHX/Scottsdale come to mind. These were once lucrative ABNB destinations ("8 bros in a shared house"), because large groups get better economics, easier communications/logistics, etc. So, it's no surprise with higher inventory of people chasing that demand that prices will eventually come down and settle.

DueDilligence 3y ago

[dead]

dghughes 3y ago

Here is Canada it seems identity thieves are using AirBnB to steal homes. Probably not specific to AirBnB though. >Police allege MacDougall used a fake name to rent a home on an online short-term rental app and obtained the homeowner's identity information while inside. According to police, MacDougall then allegedly used that information to impersonate the homeowner and secure a mortgage from a private lender, making away with the proceeds. https://www.cbc.ca/news/canada/toronto/short-term-rental-mortgage-fraud-1.6885034 https://www.cbc.ca/news/canada/toronto/short-term-rental-mor...

Scoundreller 3y ago
Sadly, this offence seems easiest to pull off in airbnbs that are genuine home-sharing where you are renting from an actual resident that is away for short periods of time (or just relocates with family during bookings), rather than pure “buy-to-airbnb” properties with better security and that kind of documentation wouldn’t be present. The former group effectively improves local housing affordability by decreasing the latter or pushing developers towards residential construction instead of hotel construction.

chx 3y ago

> here's how platforms die: First, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves. Then, they die. Why would enshittification not apply to airbnb? Of course it does. The honeymoon (fed printing money) is over, the party is over. 2022 was the first year ever airbnb had a positive net income, such things don't come easy.

deleted 3y ago
[deleted]

irrational 3y ago

AirBnbs were great years ago, but the fees are often more than the rental price these days. We pretty much stick to hotels and Bed & Breakfasts these days.

iJohnDoe 3y ago

I can’t believe anyone would stay in an AirBnB after all the reports of hidden cameras. For me personally, it’s not worth the risk even if the risk is minimal. Plus, all the cleaning fees and other things people have mentioned. Also, it seems like some hosts are not a good fit to be in the AirBnB business. The hosts that are super paranoid about every guest or what is happening in their home - and are the type to use cameras or stop by unannounced, etc. It’s like an Uber driver who is ultra protective of their car. They shouldn’t be in the Uber business. There is a balance and some just aren’t suited to be an AirBnB hosts.