What Airbnb Did to New York City

AirBNB and Uber are the least racist companies on the face of the earth. No other companies on earth have opened up the avenues for direct social interactions across race and class lines the way these two companies have.

Before Uber and AirBNB, how many opportuinities could you name for white Americans to do the following:

1. Get in a car with a black person for an hour and have a conversation about the election

2. Go into a racially diverse neighborhood and have a black family open their home to you and spend the weekend together

3. Have a black person come and rent a room in your own home and stay with your family for a weekend

4. Allow people of color who own property in predominantly black communities to profit from their own home

The only ones who benefit from these hit pieces on AirBNB are hotel groups who want to regulate these arrangements out of existence and drive up costs for hotels.

Who do you think is harmed the most when hotel prices rise? It is the same people of color (and everyone else), who have to pay more to stay downtown in major metropolitan cities.

Any study of AirBNB that does not take into consideration social mobility and prices of affordable overnight rentals is a BS study, they are comparing bananas to coconuts.

Yet we only see half of the story told in the media. Why is that? It’s almkst as though the authors of these studies have a distinct agenda.

How are the effects any less racist than the rising home prices, which could easily be explained by...uh...the massive stock market rally we just had?

Where are the studies about how people of color who own the buildings and units being rented out in ethnically black neighborhoods can now afford to send their children to college?

Reading the comments here: Too many people ask too few questions and have too little understanding about the free market. Freedom of personal property is GOOD for Black People. It is the ONLY way black people improve their situation.

Nooo. Trailers are the country ghetto. Unlike houses they are depreciating assets. So if you are fortunate enough to own your land and dwelling, unlike a home the value curve trends towards zero. The land value is the only asset, and doesn’t build much wealth.

Expensive rent in a rural area means people get pushed further away. In the medical practice that my mom worked at, employees commuted as far as 100 miles.

This is always such a stupid argument. Zoning and regulations are not about what is there, its about what you WANT to be there. If you had supply issue in an area full of flats, and you said "all buildings from now on have to be at least 2 stories high", 100% of buildings could not be built today. But you're trying to make things better.

(I realize that's not the point of the article you linked, and that it's usually the other way around, but the "X% of buildings could not be built today" on its own is just stupid).

I live in a condo that could not be built again under current zoning laws and regulations. And you wouldn't want it to: its not safe anymore (thus new code) and the current sewer is at capacity (until there's a major overhaul there, you can't build anything else).

Sometimes its not as simple as "build whatever!!!". We should be allowed to learn from our mistake and make things better.

This is not quite Pareto distributed but it's getting there:

"half of all Airbnb rentals that are conducted by only 10 percent of hosts, who earned a full 48 percent of all the revenue earned in the city last year. That’s some 5,000-people earning a combined $318 million. In contrast, the bottom 80 percent of New York’s hosts—the city’s 40,400 true home sharers—earned just 32 percent of all revenue, or $209 million, in 2017."

While I like the exploration of facts like this, I don't really believe AirBnB is important to rents in New York City. In spatial statistics it is difficult to really prove anything rigorously, and this study doesn't even try to go the distance.

"Applying Barron et al.’s national average ratio of exogeneity to New York City, this implies that, city-wide, Airbnb drove up rents by 0.8% in 2015, 0.4% in 2016, and 0.2% in 2017 (all for years ending in August). This is a cumulative 1.4% increase in rents over these three years attributable to Airbnb’s presence in the city."

So while it might seem like the study looked statistically at AirBnB's impact on NYC, in fact it did not. They just used a sort of rough rule-of-thumb from a national average. But the rule-of-thumb is useless in particular cities (suppose a city had one unit on AirBnB; would adding one more increase rents?), and isn't even from published work. The authors of this study are not economists or econometricians, and it isn't peer-reviewed and never will be.

Moreoever, you can use common sense:

"Airbnb has removed between"

(Dr. Evil voice)

"7,000 and 13,500 units."

New York City has 3.4 million housing units. While year to year housing production varies a lot, on average it produces that number of new units every few months: https://imgur.com/a/gnzUf The report also notes that these units are concentrated in the most expensive neighborhoods anyway. And NYC is only part of a much larger housing regional housing market. It simply strains credulity to think even the upper bound of 13K units has any impact---especially when you consider some of the people occupying such units would have letted or subletted in NYC anyway (the report notes many are long term rentals).

Of course, the real action is in zoning. NYC has seen some upzonings, but mainly massive, consistent downzonings over the past few decades. It is funny people worry about about supply when a private firm removes a tiny bit of it, but nonchalant when the government removes lots of it. Construction costs have also soared, and are now sure to get worse thanks to Trump's tariffs on steel, aluminum and canadian timber.

> Perhaps in your country...

Yes. That's what I was explaining. You can just do that in many rural areas of the U.S.

That's the big difference compared to urban development. You don't need billion dollar loans and a lobbying firm to add solve the problem on the supply side. It's very common for semi-retired middle class people to buy undeveloped land with good highway access, subdivide it, add some housing, and flip it.