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The Airbnb application is displayed on an iPhone and iPad in this arranged photo. (Andrew Harrer/Bloomberg)
The Airbnb application is displayed on an iPhone and iPad in this arranged photo. (Andrew Harrer/Bloomberg)

Airbnb brings Vancouver millions in economic benefits: study Add to ...

Airbnb has fired its latest salvo in an intense lobbying campaign in Vancouver as city councillors ponder new limits on short-term rentals: a study saying that the service brings in hundreds of millions of dollars of economic benefits to the city.

An economic-impact report by a Victoria business professor says that the quarter-million people who visited Vancouver using Airbnb in the 12 months up to Aug. 31 this year generated a total of $402-million in direct and indirect benefits.

That included $72-million that hosts got in revenue, $57-million that they spent as part of being a host and $179-million that guests spent locally, along with spin-off effects.

Read more: Vancouver steps up campaign against illegal short-term rentals

Read more: City of Vancouver files lawsuit to shut down Airbnb host

“These numbers indicate the impact of Airbnb customers. That’s big,” said Professor Brock Smith, who has done numerous economic-impact studies for other customers and was paid for his work for Airbnb. He is the director of the University of Victoria’s Innovation Centre for Entrepreneurs.

Prof. Smith’s study indicated that only 4 per cent of visitors said they would not have come to Vancouver if they couldn’t book specifically through Airbnb, which equated to $23-million in impact. But, he said, most people would book through other platforms, from Kijiji to Craigslist to VRBO if Airbnb didn’t exist.

“What I find interesting about the whole issue is that Vancouver thinks it’s Airbnb’s fault that people want to rent their houses out.

But it’s not an Airbnb issue, it’s an Internet issue.”

However, the argument about economic benefits is not likely to weigh heavily for Vancouver councillors, as they decide later this year exactly what the city’s new regulations for short-term rentals will be.

Councillor Geoff Meggs said the dominant concern is the fact that the city is losing long-term rental units to services like Airbnb and others. The city has estimated that about 1,000 of the 5,000 or so listings Airbnb has in Vancouver at any one point are apartments that have been taken away from long-term renters. (Airbnb did another study recently saying that only 320 units generate more income than a typical long-term rental.)

If there is any other argument that will influence councillors, Mr. Meggs said, it’s the one they’ve had from residents who are Airbnb hosts about how much they need the money.

“This is critical income for people in an unaffordable city.”

Mr. Meggs also noted that a chunk of money that Airbnb visitors’ pay goes “straight offshore” to the company through the fees that it charges hosts for booking.

Vancouver staff proposed a new strategy last month for handling short-term rentals. The strategy, which is now in a phase of public feedback, recommended allowing people to rent out all or part of their principal residences for short-term rentals, as long as owners got business licences.

But the proposal recommended that anyone who appeared to be running the equivalent of a hotel, renting out a suite or house on a year-round basis, should be prohibited.

As well, planners said lane-way houses and basement suites, even if they belong to someone whose principal residence is the main house, couldn’t be used for short-term rentals.

Airbnb has done a number of economic-impact studies, mainly in the most contentious and high-income cities where it operates around the world, including New York, Paris, London, Sydney and Barcelona.

“We want to try to understand our impact and we tend to look at the big markets,” said Alex Dagg, the public-policy manager for Airbnb in Canada. She said the company might do one for Toronto next.

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ECONOMIC IMPACT IN OTHER CITIES

As Airbnb fights against attempts to regulate or ban it in cities around the world, it has attempted to measure its economic impact.

Those reports measure that impact in different ways, making them difficult to compare.

Here is a sample of Airbnb’s previous estimates.

San Francisco

San Francisco-based Airbnb examined its impact on the city in 2012, estimating travellers who use the service were spending $56-million (U.S.) a year in the local economy. That included $12.7-million collected by hosts.

New York

Airbnb released a report in 2013 that estimated travellers using the service spent $105-million in New York and its outer boroughs, generating $632-million in economic activity.

It noted 82 per cent of visits in 2012-13 were in areas outside of midtown Manhattan, where most tourism tends to be concentrated.

Paris

More than 223,000 people stayed in units listed on Airbnb between 2012 and 2013, the company says, generating about $240-million in economic activity.

U.K.

The company says its service generated $824-million in economic activity in the United Kingdom in 2013.

Source: Airbnb

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