Staff Reporter
Auckland, September 7, 2022
A new study has revealed the impact of Airbnb listings on locations and residential rent prices.
University of Auckland Business School Researchers Dr William Cheung and Associate Professor Edward Yiu conducted the study on ‘The Impact of Airbnb Rentals and different neighbourhoods,’ which has been published in Tourism Management magazine.
It explores the effects of touristification on rent, catalysed by Airbnb.
Editor’s Note: Airbnb (Air Bed and Breakfast) is a service that lets property owners rent their spaces to travellers, who can lease for multiple people to share. A shared space can with private rooms or the entire property.
Dr Cheung said that touristification is a process that sees unplanned tourism transform a space into one that caters to tourists, provoking displacement pressures on local neighbourhoods.
The researchers’ study shows that while increases in Airbnb listings raise rents in apartment-heavy areas like the central city, more Airbnb rentals can reduce residential rental prices within low-density, house-dominated neighbourhoods.
Residential Neighbourhoods
Dr Cheung said that the impact of short-term Airbnb rentals is much more problematic in residential neighbourhoods.
‘In low-density residential neighbourhoods locals are more likely to notice strangers or increases in noise, and their area may not have the resources to cater to influxes of visitors. When visitors begin to swamp a community, local residents will be less willing to pay rent for that location and will move elsewhere. Whereas in the central city, residents are unlikely to notice this kind of change in population, and the area is typically more equipped to handle more people,” he said.
According to him, tourists are prone to paying higher rents to enjoy convenience, and in high-density inner city areas, rents will be higher as visitors compete with individuals who would like to live in the city centre in order to enjoy better accessibility.’
The study shows that the effects of Airbnb listings in an apartment submarket are different to those in a house submarket.
‘To partly resolve this, and in line with our findings, we propose a policy agenda for considering neighbourhood compatibility with short-term rental accommodation.’ As apartment-type properties in high-density areas are more compatible with Airbnb, designated zoning could provide cities like Auckland with more flexibility to supply tourism accommodation while avoiding creating severe urban conflicts in low-density suburbs,” Dr Cheung said.
Airbnb compatibility essential
Identifying properties and neighbourhoods compatible with Airbnb is essential for strategic tourism development and management, allowing tourism to continue without negatively impacting local communities.
Dr Cheung and Professor Yiu studied more than 22,000 Airbnb and 200,000 residential rental listings to provide evidence on how touristification creates a tourism-led rent gap in high-density locales and a conflicts-led negative rent gap in low-density neighbourhoods.
Dr Cheung said the findings are relevant to many cities, particularly Auckland, which has a high number of Airbnb listings.
‘Tourists affect the rental market, retail sales, and the diversity of neighbourhoods in both positive and negative ways, and it is important to develop policies to manage and regulate short-term rental accommodation by type or location,” he said.
Source: University of Auckland
