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"Draining equity" seems like an inaccurate description, particularly for Airbnb. The equity value of a property isn't diminished long-term by its use as a short
by tomblomfield 12y ago
"Draining equity" seems like an inaccurate description, particularly for Airbnb. The equity value of a property isn't diminished long-term by its use as a short-term rental.
Airbnb hosts impose significant negative externalities on their neighbours, and bear none of those costs. Noise, traffic, etc. That's what the regulation is designed to prevent.
- kjjw 12y agoDraining return on capital is a better summation, in my opinion. But drain on equity is probably close enough. Offloading risk is bang on though, and is the more troubling part, again in my opinion. A risk free slice of return on capital. It just sounds like a disaster in the making.
- true_religion 12y agoI don't really understand how the noise and traffic couldn't already be created by the AirBnB host just living in the area. Its not as if it went from an unoccupied place to a fully occupied location.