Report: Airbnb Listings Increase Neighborhood Rents, Pricing Out Brooklynites

The impact of Airbnb goes beyond removing rentals from the market — it also increases area rent, according to an analysis by The Real Deal.

In Williamsburg and Greenpoint, rents were found to be increased by as much as $69 a month due to the home-sharing company. The two North Brooklyn neighborhoods have a combined 3,085 Airbnb listings, one of the highest concentrations in the city. Of these listings, 575 were determined to be “commercial.”

Because Airbnb-rented apartments might otherwise be available on the market, they have the effect of reducing supply and “putting upward pressure on rents,” according to The Real Deal.

Citing research by NYU’s Furman Center for Real Estate and Urban Policy, The Real Deal calculated that those 575 North Brooklyn apartments account for 0.6 to 1.15 percent of the area’s housing inventory. Taking those units out of the market translates into an increase in median rent of 1.2 and 2.3 percent.

The Real Deal did not actually prove causation rather than correlation. Instead, the publication arrived at its conclusion by asking an expert to estimate how rents in an area would be affected if the housing inventory were to grow by the number of Airbnb rentals.

While many use Airbnb to rent out the occasional spare room, some are essentially running hotels out of their homes. TRD defined “commercial” units in two ways: Units that rent for more than 182 days a year, and units whose annual revenue exceeds the neighborhood’s median annual rent.

It’s worth noting, by the way, that it’s perfectly legal for owners of one- and two-family homes — Brooklyn’s most iconic housing type — to rent rooms or whole apartments for short stays. And many in Brooklyn do.

In Bed Stuy, rents were estimated to be increased by $40 a month due to Airbnb, while Crown Heights saw only $15 rent hikes.

Airbnb said The Real Deal’s conclusions were misleading and the data inaccurate.

Brooklyn rents have been rising for years. And though we’re slated to get nearly 22,000 new units in the next decade, experts say it won’t make the borough more affordable.

In the complex web of Brooklyn’s housing market, it’s nearly impossible to isolate the impact of a single factor like Airbnb. While this analysis provides a much-needed look at the impact of Airbnb, the subject warrants further research.

[Source: TRD | Photo: The All-Nite Images via Flickr]

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