Community Consequences of Airbnb

Short-term rental accommodations account for more than 20% of the United States lodging market, with annual sales now greater than those of nearly all legacy hotel brands. The rise of companies like Airbnb has created a booming market that provides affordable short-term rentals for travelers and new income for those with an extra couch, spare room, or even an unused home. However, while individual hosts and guests may benefit economically, the use of short-term rentals produces significant consequences for the surrounding community. Airbnb proliferation causes fewer affordable housing options, higher average asking rents, and erosion of neighborhood social capital. Due to discrimination among users on Airbnb’s platform, many of the benefits of short-term rental accommodations accrue to white hosts and guests, locking communities of color out of potential income and equity streams. These issues raise a question at the core of property law: which stick in the bundle is implicated by a short-term rental accommodation? Current regulations attempt to walk the line between protecting property rights and mitigating externalities created by short-term rental accommodations and borne by the local community. In doing so, the law fails to adequately address consequences resulting from the vast increase in short-term rental accommodations. This Article assesses the benefits and costs of short-term rental accommodations and analyzes how current statutory approaches amplify or diminish these effects. After examining the legal, economic, and social interests of multiple short-term rental accommodation stakeholders, including hosts, guests, the local community, and platform operators, it argues that current policies are fragmented, inconsistently applied, and ineffective. Instead, the law must be reformed to better secure access to affordable housing stock, prevent “hotelization” of residential neighborhoods, create meaningful opportunities for diverse users to share economic gains, and eliminate pathways to discriminate on homesharing platforms like Airbnb

Redliking: When Redlining Goes Online

Airbnb\u27s structure, design, and algorithm create a website architecture that allows user discrimination to prevent minority hosts from realizing the same economic benefits from short-term rental platforms as White hosts, a phenomenon this Article refers to as redliking. For hosts with an unused home, a spare room, or an extra couch, Airbnb provides an opportunity to create new income streams and increase wealth. Airbnb encourages prospective guests to view host photographs, names, and personal information when considering potential accommodations, thereby inviting bias, both implicit and overt, to permeate transactions. This bias has financial consequences. Empirical research on host earning rates found that White hosts earn significantly more than minorities, even when controlling for location, size, and amenities. Airbnb\u27s algorithm augments the effects and propensity of individual user bias, creating a system wherein allegedly race-neutral variables serve as proxies for discrimination. Contemporary redliking perpetuates historic inequality related to housing wealth. In the early twentieth century, redlining maps were used to justify withholding investments from Black communities. Today, redliking continues the practice of directing wealth to White communities, reinforces systemic real property barriers by depriving minority hosts of important revenue streams, and exacerbates the racial wealth gap. This Article examines the liability of Airbnb and similar websites for discrimination experienced by minority short-term rental hosts. The ability of the Fair Housing Act and Civil Rights Act, laws originally enacted to abolish housing discrimination and protect minority consumers, to combat redliking is complicated by the fact that sites such as Airbnb serve multiple purposes; while guests use the platform to identify and book lodging, hosts use the site to advertise available accommodations. Looking to judicial interpretation of platform liability in the context of online speech, this Article proposes two approaches - a general-function test and a fragmented function test - to determine website liability for discrimination against short-term rental hosts. Noting the limitations of the existing antidiscrimination legal framework, this Article argues that eradicating redliking requires incorporating lessons on platform design from behavioral economics as well as eliminating opportunities for website algorithms to amplify and operationalize user discrimination

Redliking: When Redlining Goes Online

Airbnb’s structure, design, and algorithm create a website architecture that allows user discrimination to prevent minority hosts from realizing the same economic benefits from short-term rental platforms as White hosts, a phenomenon this Article refers to as “redliking.” For hosts with an unused home, a spare room, or an extra couch, Airbnb provides an opportunity to create new income streams and increase wealth. Airbnb encourages prospective guests to view host photographs, names, and personal information when considering potential accommodations, thereby inviting bias, both implicit and overt, to permeate transactions. This bias has financial consequences. Empirical research on host earning rates found that White hosts earn significantly more than minorities, even when controlling for location, size, and amenities. Airbnb’s algorithm augments the effects and propensity of individual user bias, creating a system wherein allegedly race-neutral variables serve as proxies for discrimination. Contemporary redliking perpetuates historic inequality related to housing wealth. In the early twentieth century, redlining maps were used to justify withholding investments from Black communities. Today, redliking continues the practice of directing wealth to White communities, reinforces systemic real property barriers by depriving minority hosts of important revenue streams, and exacerbates the racial wealth gap. This Article examines the liability of Airbnb and similar websites for discrimination experienced by minority short-term rental hosts. The ability of the Fair Housing Act and Civil Rights Act, laws originally enacted to abolish housing discrimination and protect minority consumers, to combat redliking is complicated by the fact that sites such as Airbnb serve multiple purposes; while guests use the platform to identify and book lodging, hosts use the site to advertise available accommodations. Looking to judicial interpretation of platform liability in the context of online speech, this Article proposes two approaches—a general-function test and a fragmented-function test—to determine website liability for discrimination against short-term rental hosts. Noting the limitations of the existing antidiscrimination legal framework, this Article argues that eradicating redliking requires incorporating lessons on platform design from behavioral economics as well as eliminating opportunities for website algorithms to amplify and operationalize user discrimination

Shift in house price estimates during COVID-19 reveals effect of crisis on collective speculation

We exploit a city-level panel comprised of individual house price estimates to estimate the impact of COVID-19 on both small and big real-estate markets in California USA. Descriptive analysis of spot house price estimates, including contemporaneous price uncertainty and 30-day price change for individual properties listed on the online real-estate platform Zillow.com, together facilitate quantifying both the excess valuation and valuation confidence attributable to this global socio-economic shock. Our quasi-experimental pre-/post-COVID-19 design spans several years around 2020 and leverages contemporaneous price estimates of rental properties - i.e., real estate entering the habitation market, just not for purchase (off-market) and hence free of speculation - as an appropriate counterfactual to properties listed for sale, which are subject to on-market speculation. Combining unit-level matching and multivariate difference-in-difference regression approaches, we obtain consistent estimates regarding the sign and magnitude of excess price growth observed after the pandemic onset. Specifically, our results indicate that properties listed for sale appreciated an additional 1% per month above what would be expected in the absence of the pandemic. This corresponds to an excess annual price growth of roughly 12.7 percentage points, which accounts for more than half of the actual annual price growth in 2021 observed across the studied regions. Simultaneously, uncertainty in price estimates decreased, signaling the irrational confidence characteristic of prior asset bubbles. We explore how these two trends are related to market size, local market supply and borrowing costs, which altogether lend support for the counterintuitive roles of uncertainty and interruptions in decision-making.Comment: Main manuscript: 16 pages (5 figures); Supplementary Information: 11 pages (11 figures, 3 Tables

“ONE MORE WAY TO SELL NEW ORLEANS”: AIRBNB AND THE COMMODIFICATION OF AUTHENTICITY THROUGH LOCAL EMOTIONAL LABOR

Since 2014, Airbnb has been the poster-child for an impassioned debate over how to best regulate short-term home rentals (STR’s) in New Orleans, Louisiana. As critical perspectives toward on-demand economic practice become increasingly common, it is important to understand how the impacts of STR platforms like Airbnb extend beyond the realm of what is traditionally conceptualized as the economic (i.e., pressure on housing markets). In this thesis, I explore the ways in which Airbnb recalibrates the spatial and temporal rhythms of everyday neighborhood life for people external to the formal trappings of an STR contract. Drawing in particular on theories of authenticity and feminist political economy, I argue that locals’ emotional labor of “playing host” is necessarily enrolled into the creation of value for Airbnb, and is essential to the reproduction of the platform’s business model and marketing rhetoric

An Analysis of the Changing Competitive Landscape in the Hotel Industry Regarding Airbnb

This thesis analyzes the competition between hotels and Airbnb in San Francisco. Airbnb is an internet platform that allows hosts to rent shared space, private rooms or homes to tourists. This study identifies the affect Airbnb has on hotels, workers, renters, neighborhoods, and tax revenue. Interviews and research was engaged with travel industry professionals. Hoteliers were found to be apathetic about the competition between hotels and Airbnb. Airbnb can be a meaningful experience between hosts and tourists. Budget travelers might not travel if not for low Airbnb rates. Airbnb rooms supplement hotel inventory during extraordinary events. This utopian view of Airbnb seems to overcome the dark sides; evidenced by rising apartment rental rates and declining inventory. Pressures are placed on working class neighborhoods driving out the local workforce for high rate tourists. To date, Airbnb has defeated efforts to be effectively regulated. Unregulated conversions of residential to hotel use is a safety concern. San Francisco Ordinance 218-14 was passed to legalize and regulate Airbnb; however 218-14 is unenforceable. California Senator McGuire authored SB 593: The Thriving Communities and Sharing Economy Act to empower regulation of Airbnb. SB 593 has not been passed yet by the California Senate. Until tax payments, legal, regulatory, safety codes, and compliance issues are addressed the majority of Airbnb will be operating illegally with an unfair competitive advantage over hotels

“You Can’t Hide Behind Being a House”: Examining the Policy Process, Design, and Implementation of Short-Term Rental Regulations, a Case Study of Nashville, TN

Following the economic crash of 2008, the rapid expansion of platform capitalism and the recruitment of others to work for themselves using a company’s platform, has led to a ‘paradigm shift’ in which a sharing economy business model has enabled small entrepreneurial endeavors to become industry giants (Srnricek, 2017). One such platform, Airbnb, has created a new, informal tourism accommodation sector that is bringing with it questions of regulation and community impact. Airbnb regulation thus is a growing national and international trend affecting cities of all sizes and forcing policy response and change at the local government level. Current trends suggest the growth of Airbnb in popular downtown neighborhoods in cities with international tourism appeal is creating new policy questions, gentrification pressures, and overall community impacts that necessitate further study. As policymakers seek to minimize impacts on neighborhood character and housing availability while still harnessing economic activity generated by the platform, the regulatory debate is bringing new challenges as laws designed around traditional tourist accommodations have become outdated and largely do not apply to the short-term rental market enabled by Airbnb. With multiple stakeholders involved, conflicting interests present further challenges to creating policy that best protect the interests of all those involve while safeguarding local communities (Nieuwland & Van Melik, 2018; Park, 2019) making regulation difficult to pass and even more challenging to enforce. As cities struggle to react to the rapid growth of the short-term rental market, this research examines existing policies, policy processes, and perceived community impacts of the short-term rental market in urban communities with high densities of STR units in order to inform local decision-makers and stakeholders in the formation of future policy decisions. Overall, the findings of this research provide a deeper understanding of the policy environment and local community level impacts being experienced in cities where tourism is part of the economic engine. Part one of the study employed a policy scan of fifteen US cities. Findings present five emergent themes found consistently from policies including, Purpose of Regulation, Definitions, Licensing, Registration & Application Requirements, Operational Requirements, and Enforcement. Part two of this study presented a case study of Nashville, TN providing real-life context to the implementation of the policy themes determined in part one. Part two specifically examines stakeholder experiences and perceptions of the policy process, design, and factors leading to the passage and subsequent revisions of short-term rental regulations in the city. The results highlight the many factors impacting cities as they seek to manage the growth of the short-term rental market and the development and implementation of effective policy in the urban environment. The findings of this study also reveal common themes and potential best practices for cities as they try to create stronger communities for their residents and visitors alike