In the US, the canary in the coalmine may turn out to have been the Super Bowl last month, when the confluence of the biggest game in American football, a huge international golf tournament and annual spring training should have brought a windfall to the landlords of Phoenix, Arizona. Unlike some cities – notably, Barcelona and Los Angeles – that have introduced measures to curb the growth of short-term rentals, in Phoenix there are few restrictions. And so, in February, hosts of Airbnb, Vrbo and similar properties-for-let companies stood by for a bonanza, hiking prices to an average of $1,000 a night. And then they waited. And waited.
I remember the promise of early stays at Airbnbs. It seemed like such a win, a wild combination of more space for less money, deeper engagement with a local community and, by circumventing hotel chains, the obscure but unavoidable sense present at the start of so much disruptive technology, that you were getting one over the Man. If you were travelling with kids, the mere presence of a kitchen made Airbnb properties seem like a dream. And look, here came a nice host to tell you which local diner to eat at. It was, literally, all so homespun and pleasing.
That was 10 years ago. Most of us are familiar with at least some of the twists and turns of what happened next. In the big cities and desirable resorts, the lure of ostensibly easy money from an endless stream of tourists encouraged locals to invest in second properties and landlords to pivot from stable, long-term rentals to quick turnovers. Rental price hikes and housing shortages followed. In some parts of Cornwall, the Guardian reported two years ago, there were more than 10,000 Airbnb properties advertised, and just 69 listings for those seeking more permanent homes. In August 2021, Barcelona became the first major city in Europe to ban short-term private room rentals. In LA, meanwhile, the city council passed laws restricting Airbnb and similar platforms to those renting out their primary residence.
Now, Covid disruptions notwithstanding, the market in short-term rentals appears to be slowing. According to AirDNA, the rental analytics company, occupancy rates fell in 31 of the top 50 largest US short-term rental markets in the second half of last year. Last week, Airbnb announced it would be laying off 30% of its recruiting staff, even as it expected to expand its head count elsewhere. It’s not exactly a failing company: last year, it reported a net income of $1.9bn. But the rampant growth of its early years seems to be over, for now, a fact that tallies with what feels like a change in conversation around where to stay when you travel.
Part of this is probably just waning novelty. Uber was great, until it wasn’t. In an expensive city like New York, Airbnb seemed initially to be a win both for tourists and locals wanting to rent out their bedrooms – until it wasn’t. Nobody wants their neighbours renting to Airbnb guests, and local apartment buildings took aggressive measures to stop it. It is bold, to try to sneak paying guests in, when management in a stringently regulated New York coop building scours short-term rental sites for listings. These are the kind of Airbnb arrangements that come with a note from your host suggesting that, if confronted, “you say you’re our cousins from Leipzig”. In my building, you can spot them a mile off, a sheepish looking group with wheelie suitcases trying to slink through the lobby while avoiding the glares of the front desk.
Airbnb responds that its business has injected billions into local economies that would otherwise have flowed into the hands of hotel groups. And from a consumer point of view, it was great, for a while. I’ve never had an Airbnb nightmare. We’ve had some lovely hosts, and we’ve had some equally lovely detached oversight from management companies renting out property as part of a portfolio. As the cost of the fees has crept up, however, it has become necessary to think about what exactly it is we’re paying for.
Other people’s stuff; limited recourse in the event of disappointment; no restaurant or housekeeping. And, potentially, something you don’t always want on a quick trip: personal contact. If it’s carrying a higher sticker price than a fancy hotel, this might explain why, while hotel occupancy in Phoenix during Super Bowl week was above 80%, half of the short-term rentals sat empty.
Emma Brockes is a Guardian columnist
