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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 popul

by 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
- arebop 3y ago
  SF City Economist Egan took a more careful look and estimated that SF's housing prices could be changed significantly by adding 100k housing units [https://www.sfexaminer.com/news/leveling-sf-housing-field-could-take-100-000-new-units/article_ff9da114-60d8-5403-82ea-abd1be5583aa.html https://www.sfexaminer.com/news/leveling-sf-housing-field-co...]. Maybe in some markets, like Venice Italy, you could make housing a lot cheaper by enacting a total ban on tourism. But I remain unconvinced that tourism in general or AirBnB in particular is a major factor in general. We can see from Egan's study that it isn't in San Francisco where tourism is our #2 industry, it's impossible to believe that across the country and around the world travelers are meaningfully preventing locals from finding a place to live. People just don't travel that much! Also, this trick only works once. After we've eliminated global tourism to add fewer than 5% more houses globally, we cannot do it again next year and forever after to keep prices down while we continue to allocate increasingly more of society's wealth to the fixed supply of housing.

by arebop 3y ago

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

arebop 3y ago
SF City Economist Egan took a more careful look and estimated that SF's housing prices could be changed significantly by adding 100k housing units [https://www.sfexaminer.com/news/leveling-sf-housing-field-could-take-100-000-new-units/article_ff9da114-60d8-5403-82ea-abd1be5583aa.html https://www.sfexaminer.com/news/leveling-sf-housing-field-co...]. Maybe in some markets, like Venice Italy, you could make housing a lot cheaper by enacting a total ban on tourism. But I remain unconvinced that tourism in general or AirBnB in particular is a major factor in general. We can see from Egan's study that it isn't in San Francisco where tourism is our #2 industry, it's impossible to believe that across the country and around the world travelers are meaningfully preventing locals from finding a place to live. People just don't travel that much! Also, this trick only works once. After we've eliminated global tourism to add fewer than 5% more houses globally, we cannot do it again next year and forever after to keep prices down while we continue to allocate increasingly more of society's wealth to the fixed supply of housing.