More data on AirBNB's effect on London - scams included

While I’m always a bit skeptical of the Air BNB is driving rents up claims, it’s definitely a convenient punching bag for housing and rent control advocates, it is true that it’s a Wild West out there.

I tend not to use them because if something goes wrong, it can go really wrong and at the least it’ll suck a lot of valuable time out of your limited vacation time. If there’s a hotel room problem they can change your room. If it’s a hotel wide problem, they’ve got a plumber or whatever’s needed on speed dial.

I think it's more of an evolution thing. The orig AirBNB people were doing it (mostly) for the original reasons. And that (mostly) worked. Then it blew up, got huge => all the problems that causes. Especially trying to do everything automated (to keep the costs down).

Then, with the increasing size of the market, the predators started moving in. :-(

Hard to say where it'll go from here. But I've heard it said a lot (not all) of those regulations these companies are trying to "disrupt" were originally written (if only metaphorically) in blood.

Most people who work in London have never been able to afford to live in Zone 1 of the underground, which is where most tourists want to stay. These properties are owned by Arabs, Russians and the Chinese who have pushed the prices up, not Airbnb on the whole.

I thought those were a different part of the Market? And also pushing up prices like AirBNB. I thought most of those were foreign investment (money laundry?) type things. Didn't think those would be that big in the AirBNB market part. Could be wrong. But if those are being let out would expect them to show up in the traditional property management segments.

I think there’s some confusion.

‘Why is the rent so damn high!’

Person one says, ‘blame air BNB, all the rentals are being used for short term housing and not the rental market.’

Person two says, ‘blame foreign investment, wealthy foreigners buy up property and sit on it without renting it out.’

Obviously rent in large cities is influenced by a variety of factors, you could write a doctoral dissertation on it.

Air BNB in particular gets used as a punching bag because it’s a convenient target for local politicians everywhere.

Uh, no.

My objection to AirBNB is not higher prices. My objection is what seems to be particular tactics. Part of the whole "disruptor" wave. The foreign "investment", while it might be shady (don't know), seems entirely (and depressingly) legal. Many of AirBNB's tactics, in many markets, seem to be "make us stop".

I believe the effect on London is not as bad as some places in that, as has been mentioned, the properties tend to be much more expensive. I would expect that to limit these kind of opportunities but I'm not an expert. And I believe it's time for me to get out of a discussion I live way too far away from to be taken seriously.

Impact of AirBnB rentals on local housing market depends on the portion of the housing converted to short term AirBnB type rentals. In a small housing market like Iceland, with a high demand for seasonal rentals, AirBnB's proliferation has a more significant impact on year round housing cost to permanent residents. One article claims that AirBnB absorbs 10% of the Icelandic multi-family housing stock:
https://icelandmag.is/article/airbnb-nation-10-icelandic-apartments-listed-airbnb-a-major-cause-rising-home-prices

Travel rental has changed the Icelandic property market in dramatic
fashion, new research by economists at the Icelandic Central Bank
shows. According to the research nearly 10% of all apartments in
Iceland were listed on Airbnb in 2017. In the past three years Airbnb
has also contributed to the dramatic increase in real estate prices in
Iceland, the study found.

Question in need of an answer is the percentage of London housing converted to short term rentals. Impact would be more significant is neighborhoods popular with tourist and would be less of an impact in the "low-rent" neighborhoods that tourist fear.

I will reinforce what emma has just said. It is a very strange housing market along South Bank, whereby investors just hold these condos for investment only. These are safe places to park money. They don't even rent them out to locals. Its odd to go there along the river walk in the morning and see almost no people and no activity, and the parking garages are empty. These same sort of , luxury high rise, ghost towns are happening all over the USA. The units have been bought, and condo fees are paid, but the, long distance, investors don't even bother to rent them out and are betting on just the property appreciation: Its a very strange economics.

And there’s probably some money laundering going on as well. Who knows? When I worked in the financial markets, I had to take tons of anti money laundering classes even though I never handled a financial transaction.

But getting back to Air BNB, it’s obviously a popular punching bag for anti gentrification activists and rent control activists. And, the hotel industry of course has an opinion.

But, air BNB is still such a wild Wild West atmosphere that I generally prefer to avoid it. I’m not traveling with fussy kids and cooking is definitely out for me. Get to know my neighbors and a local feel? Maybe, but I’ve lived in this high rise apartment for 5 years and barely know any neighbors. And while it’s got a neighborhood feel, it wouldn’t be ideal for a Chicago vacation if you’ve got 3 days to see the main sights unless you’re here mainly for the Cubs.