With more than three-million lodging listings across the globe, Airbnb looks unstoppable, and Canada is no exception.
But the popularity of the world’s largest accommodation-sharing site, has some considering how housing markets are being impacted.
Canada’s three biggest cities, Toronto, Montreal, and Vancouver, are part of a new report from McGill University entitled, ‘Short-term Cities: Airbnb’s Impact on Canadian Housing Markets’, which is the first comparative analysis of short-term rentals in these areas.
More than 81,000 Airbnb listings were active in these cities in the last year, earning $430 million. Out of those listings, 13,700 are entire homes that are rented 60 days or more on an annual basis, and have unlikely availability for long-term tenants.
According to the report,this is having serious consequences.
“The most commercialized category–full-time, entire homes run by hosts with multiple listings–is also the fastest growing. These trends suggest increasing amounts of housing are being taken up by profit-seeking short-term rentals, and that the short-term rental market is moving further and further away from the idea of home-sharing,” says a press release on the matter.
Prof. David Wachsmuth, lead author of the study, explains these neighbourhoods have above-average rents, and economic pressures could result in further conversions of long-term rentals to de facto Airbnb hotels in more affordable areas.
“One thing that really surprised us was that the share of houses on Airbnb that are being rented out full-time and taken off the long-term housing market has been increasing extremely quickly,” said Wachsmuth.
Of the 26,000 multi-listings in Montreal, Toronto, and Vancouver, a small subset are full-time, entire homes, and multi-listings, stated the university’s article.
“These are the listings which represent the maximum commercialization and commodification of home sharing: they are being operated as a large-scale business, and they are taking long-term housing off the rental market,” says the report. “Because of their particularly severe impact on housing markets in the three largest Canadian cities, we refer to these listings as the ‘unholy trinity’.”
This problem is also affecting the U.S. in major cities, including New York, Los Angeles, and San Francisco.
A report by Housing Conservation Coordinators and MFY Legal Services found, “For each of the top 20 neighborhoods for Airbnb listings in Manhattan and Brooklyn, average rent increases have nearly doubled the citywide average from 2011 to 2015. In 2015, the report estimates the city also lost more than 8,000 housing units to Airbnb, reducing access to affordable housing in the city by 10%.”
Furthermore, the study found more than 90 per cent of Airbnb’s listings are in the boroughs of Manhattan and Brooklyn, and “The average NYC Airbnb unit is rented 11 days per month, or 132 days per year. This means these units are unavailable for nearly 4.5 months for residents.”
The McGill report suggests three ways Canadian cities can respond to the issue of the expanding short-term rental market, and how to protect the availability of affordable housing for city residents.
First, one host, one rental. “Cities should allow residents to rent their own homes, but should not allow large-scale commercial operators to convert multiple homes into de facto hotels.”
Second, no full-time, entire-home rentals. “Home-sharing should be an occasional thing, not a full-time business.”
Third, platforms responsible for enforcement. “Airbnb and other platforms should be responsible for enforcing the regulations.”