Only 320 Airbnb hosts in Vancouver rent out their properties often enough to make more money than they would from long-term renters, according to new data released by the company as the city prepares to launch new regulations for short-term rental services.
That represents only 0.11 per cent of the almost 300,000 housing units in the city, says the author of the report, Airbnb’s head economist, Peter Coles. Most of the rest of Airbnb’s hosts don’t rent out their housing enough to compensate for the loss of the average $2,000 a month possible for long-term rentals, he said. Average earnings by hosts are only $6,600 a year.
“Just over 8,500 listings – about 3 per cent of the Vancouver housing stock – participating in occasional homesharing is not a material driver of housing prices,” concludes Mr. Coles’s analysis.
The U.S.-based company argued its data showed Airbnb is not having a dramatic effect on Vancouver’s housing market, where critics have complained short-term rentals are eating up supply and inflating prices in a region with vacancy rates of below 1 per cent. A report summarizing the company’s findings was set to be released Wednesday, as the City of Vancouver announces a proposed set of regulations that are expected to place limits on Airbnb and similar services.
The report concludes almost half of the 8,500 hosts who did rent out units last year did so for fewer than 30 nights.
University of B.C. business professor Tom Davidoff agreed that Airbnb is likely not a significant factor in the Vancouver region’s rising home prices.
Mr. Davidoff, with whom Airbnb consulted to understand the impacts of short-term rentals on rents, said the general public frequently looks at the fact that Airbnb is popular in expensive neighbourhoods and concludes that it is Airbnb that drives up rents there.
But, he said, those neighbourhoods were expensive anyway and the impact of Airbnb taking a certain slice of the available stock is minimal.
“If Airbnb eats up 1 per cent over a period of five years, that is probably driving prices up by 2 per cent,” said Mr. Davidoff, who was not paid for his advice to Airbnb. “The impact just doesn’t look as big as you might think.”
Airbnb’s release of the new set of data undercuts reports that have been done by researchers in Vancouver and elsewhere, who have extracted what information they can from Airbnb’s public site to conclude that most of Airbnb’s revenue comes from a core group of commercial operators.
They’ve said Airbnb presents a false picture by saying most hosts are just renting out their units sporadically, as a way of making a bit of extra money.
But Airbnb officials say those researchers have access only to imperfect data – the public listings and their assumptions about how often they are rented out.
They say the data that Airbnb analysts can glean from the inside give a much more accurate picture of how many days owners are renting their units and what income they’re making.
However, even the insider Airbnb study isn’t complete, acknowledged Mr. Coles and Mr. Davidoff.
It’s difficult to tell from the data how many units are being kept out of the long-term rental market by owners who are making less than $2,000 a month, but are choosing the convenience of short-term renters because nothing currently prevents them from doing that.
Mr. Davidoff also said it’s possible the impact on the rental-housing stock or on particular neighbourhoods could be higher than the study suggests.
Airbnb calculated that 320 units was only 0.11 per cent of the total Vancouver housing stock: every house, townhouse and condo in the city.
But those 320 units are likely primarily coming from the smaller pool of rental stock, which is about half of all Vancouver housing. And some popular neighbourhoods might have even higher proportions of Airbnb units compared with the total number of rentals available there.
Whatever Airbnb’s numbers are, city officials are getting set to announce regulations for short-term rentals Wednesday that are expected to put limits on them.
Indications from city staff are that short-term rentals will be restricted to houses and condos that are primary residences, with some kind of yearly cap on the number of nights in a year – anywhere from 90 to 180 – they can legally be rented out.
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