Airbnb Drives Up Rent Costs In Manhattan and Brooklyn, Report Says (cnet.com)

According to a report from New York City's comptroller, Scott Stringer, Airbnb is causing rent prices to increase significantly in Manhattan and Brooklyn (Warning: source may be paywalled: alternative source), where the majority of the company's rentals are concentrated. The New York Times reports: In Manhattan's Hell's Kitchen and Chelsea neighborhoods and the Midtown Business District, which accounted for about 11 percent of all Airbnb listings in New York City in 2016, average monthly rents increased by $398 between 2009 and 2016, of which $86, or 21.6 percent, was a result of Airbnb's presence, the report said. In Greenpoint and Williamsburg in Brooklyn, the study said, rents went up 18.6 percent in those years because of Airbnb listings. Airbnb makes it easy to rent apartments to tourists, taking units off the market for full-time residents, the report said. The report said that Airbnb's influence cost New Yorkers $616 million in additional rent in 2016 as a result of price pressures.

Comments

...and?

[MightyYar]

Every type of economic activity increases rents... like, all of them. New restaurants - increase rents. Jobs increase rents. So you flood an area with tourists and the rents go up? OK, in isolation that sounds bad - but what did all of that tourism money do to the local economy? If rents go up, doesn't that also encourage investment in the neighborhood? How can you just look at this one statistic in isolation? Cities were murdering each other to get the new Amazon headquarters... what would that do to rents?

Re:...and?

[bobbied]

but.. But.... I want to complain about something and those big bad companies that make money are good targets!

How dare you tell me there is ANYTHING good about the thing I choose to complain about...

Re:...and?

[msauve]

And, it reduces the cost of temporary shelter. So, it's an equalizer.

Re:...and?

[Actually, I do RTFA]

. So you flood an area with tourists and the rents go up?

There's no reason to think there are more tourists visiting NYC. Occupancy rates in hotels are down, year-over-year.

You are right that you have to look at mutliple factors, but you probably would want to compare rents, inflation and wages. After all, the important thing to the average renter is what percent of their money goes to rent.

Re:...and?

[Anonymous Coward]

If rents go up, doesn't that also encourage investment in the neighborhood?

No. The reason rents go up is because supply is reduced. AirBNB turns housing into hotels. And in cities where there isn't much more room to build new housing that squeezes out residents.

If the goal is turn a community into a tourism spot, then sure, its great. But if the goal is to have a self-sustaining community then all its doing is throwing the equilibrium out of whack.

Re:...and?

[Anonymous Coward]

short term rentals less than a full month per stay should be regulated and taxed like a hotel.... because that's what they're doing... renting hotel rooms. besides the obvious lost hotel tax revenues that airbnb does not pay, hotel guests have certain protections and guarantees, such as posted rates, anti-discrimination laws, emergency exits and fire alarms and sprinklers that comply with codes, and a company that is financially liable should something go wrong. there's no guarantees of any of that with airbnb (in fact, discrimination is very common), just like there isn't with uber (which should be regulated and taxed like a taxi cab service, because that's what they're doing).

Re:...and?

[ShanghaiBill]

NYC restricts the supply of housing by refusing to issue building permits, so prices are going up. The only solutions are rent control or usage restrictions.

Removing the restrictions on building, and allowing the supply to rise to meet demand is NOT a solution, because the NIMBY voters of NYC would never accept it. They don't want NYC to lose its "small town" neighborhood feeling - and, no, this is not a joke.

Re:...and?

[Anonymous Coward]

Occupancy rates in hotels are down, year-over-year.

I wonder if some kind of an alternative to a hotel became available in recent years. Like some kind of service that allows you to rent from a common homeowner.

Re:...and?

[Dutchmaan]

Cities were murdering each other to get the new Amazon headquarters... what would that do to rents?

Increases rent faster than wages resulting in an increased homeless population. Also Amazon is buying up the residential so they can bring people in and set them up with homes right away...

In short, Amazon is great for a city's economy, but it's awful for the people who are already living there.

Re:...and?

[Guybrush_T]

So does that mean some hotels will close and be reconverted as apartments, driving rent down ? Sound like life and death of competing business models ...

Re:...and?

[ShanghaiBill]

"solutions" to what? rent going up? why is that a problem?

Because landlords are evil, and tenants are virtuous victims. Furthermore, victimhood is only available to current residents, not to people that want to live in NYC but can't because affordable housing is not available.

Stop rent control. Stop subsidizing rent. force the system to balance itself, instead.

Try running for NYC public office while saying that. Good luck.

Re:...and?

[postbigbang]

There's another way to look at this.

The hotel prices in Manhattan, just like the Bay Area, Seattle, downtown Chicago are berserk. AirBnB presence means I can spend about 1/3rd the amount of a hotel room, and spend the rest on needed things like food, transportation (expensive in all of these areas) and maybe have something leftover for a beer. Maybe.

Does that mean a NYer, San Franciscan, etc. has to pay more dough for their abode? I don't have to live there, thank heavens. This is not my problem. My problem is taking short trips to expensive cities. I'll cut my costs to suit my meager budget.

Do I empathize? No. You want avocado toast? Fine. Bagels and lox? Fine. For those that live in flyover country, you folks are insane.

That areas can't get building permits is completely understandable. The infrastructure costs are high, and politicians have cut budgets to the bone and worse. Capital investments are impossible. No one wants to shell out the money needed for upkeep and maintenance, let alone visionary spending. Everyone's in it for the moment, grab the dough and run, and the future is not our responsibility is the hue and cry of most every political hack. They never heard of sustainability and mutual responsibility. And so head to the big cities and get out as fast as we can. AirBnB is a hero to me. They help me fight the greed of the hoteliers and their insane price differentials. What differentials? That's a different story for a different thread.

Re:...and?

[BlueStrat]

Yes. Hotels have daily housekeeping. No Airbnb place I have stayed at does. The market has spoken: Many people don't want to pay for that.

However, if Airbnb is popular because they don't pay a hotel tax, for example, then that is tax evasion, not free-market competition.

Why can't there be a middle-ground?

It's rather silly to expect homeowners to pay the tax rates of a multinational hotel chain to rent out their home or apartment for a couple of months while they go on a cruise or something, but there are legitimate concerns and problems that do in fact need to be addressed.

How about creating regulations such that in areas that have a population density higher than a set amount, property owners who wish to participate in AirBnB-style activities must be licensed. Make it cheap, like $25 or less for a year so that people will comply. Place restrictions on how many weeks/months out of a year the property may be rented out. If your property is not in a high population density area, then no restrictions or license necessary.

Strat

Re:...and?

[Peter P Peters]

There is _Zero_ positive social or economic gain from rent control. It all contributes to city cancer.

The short answer is that you can't beat the law of supply and demand...

Re:...and?

[BlueStrat]

How about creating regulations such that in areas that have a population density higher than a set amount, property owners who wish to participate in AirBnB-style activities must be licensed. Make it cheap, like $25 or less for a year so that people will comply. Place restrictions on how many weeks/months out of a year the property may be rented out. If your property is not in a high population density area, then no restrictions or license necessary.

As an additional thought, the number of properties that property owners applying for a license in high-population-density areas could register could be limited, and in super-high-population-density areas and certain locations such an apartment in a major metropolitan high-rise and/or a property located in a high-crime-rate area, could be required to show proof they carry an additional rider for damage & liability on their property insurance for a minimum amount based on average actuarial numbers to cover against possible damages or other liability incurred by their temporary tenants.

All the suggestions here and in my post above that I quoted serve not only to protect communities but also discourage those who would seek to turn a great idea for a homeowner to recoup some costs of a trip or vacation by temporarily renting their home into a multi-property commercial enterprise that *is* essentially a commercial hostel service competing with hotels.

Strat

Re:...and?

[Actually, I do RTFA]

It's rather silly to expect homeowners to pay the tax rates of a multinational hotel chain to rent out their home or apartment for a couple of months while they go on a cruise or something

It's rather silly to claim that's the primary use case for AirBnB as opposed to professional, permanent rentals. It's also silly to think that it's outrageous to expect the same tax rates of homeowners... taxes are on profit (income) or per room (occupancy.) The fact that they are rates fixes that.

There were regulations with licensed people only able to participate. Those are actual BnB rules. AirBnB,and their operators, just ignore them.

Re:...and?

[Opportunist]

This is not "the economy" driving rent prices up or some other esoteric, abstract and complicated concept, it's simple basic supply and demand. If you don't put up your apartment for rent but instead decide to turn it into a one-bedroom hotel, you remove one apartment from the renting market, reducing supply of apartments with a steady or even increasing demand, thus driving the price up.

It doesn't get any simpler than that, I kinda doubt you don't know that...

Re:...and?

[AmiMoJo]

People who are already there get priority, because it's worse for them if they have to move. Might lose their job, kids have to change school etc.

Re:...and?

[AmiMoJo]

The problem is that individuals' wages don't increase because of rent increases. Most people can't go to their boss and say "hay, my landlord put the rent up, I need you to give me a raise to pay for it."

Instead they are forced out and replaced with workers who can demand higher wages due to skills/experience. And then they cycle repeats.

This is bad for everyone.

Re:...and?

[BlueStrat]

It's rather silly to expect homeowners to pay the tax rates of a multinational hotel chain to rent out their home or apartment for a couple of months while they go on a cruise or something

It's rather silly to claim that's the primary use case for AirBnB as opposed to professional, permanent rentals. It's also silly to think that it's outrageous to expect the same tax rates of homeowners... taxes are on profit (income) or per room (occupancy.) The fact that they are rates fixes that.

Did you even read both my entire posts? I addressed those concerns regarding using it as primary income rentals in a much more effective way than charging, as most of the larger cities do, ridiculous "occupancy rates" that typically per-unit far exceeds what hotels and motels are paying. Often these rates are copy-pasta straight from "industry" (read; the hotels/motels/etc) by the corrupt local politicians as simply a protection scheme for the hotels and more loot for politicians to waste or pocket.

There were regulations with licensed people only able to participate. Those are actual BnB rules. AirBnB,and their operators, just ignore them.

Because, as stated above, those laws and regulations are in many if not most cases about protecting every last possible cent hotel chains can squeeze out by putting the boot on people through corrupt government when much more fair & equitable laws & regulations that actually work as intended could easily be implemented with lawmakers who are not taking money from and acting in the interests of the hotel/hospitality industry.

Strat

Re:...and?

[MightyYar]

The entire point of my post was to dispute that narrative. A tourist staying in an apartment is not an economic drop-in replacement for a "normal" renter. They probably spend a lot more money on - if nothing else - food. Without understanding other ways in which AirBNB affects the local economy, this becomes a very shallow analysis that - as you point out - merely highlights a blindingly obvious relationship in supply and demand.

Re:...and?

[MightyYar]

So, I'm sorry for your personal situation. With that said, when you moved in you also drove the rents up. It's not like high rent is a new thing in desirable parts of NYC. Anyway, I'd need to know whether your situation is typical or not before declaring it a widespread "problem". It's possible that the increased economic activity of the entire neighborhood offsets the higher expenses that you personally incur.

Re:...and?

[MightyYar]

Supply didn't go down - warm bodies still inhabit the units. They are willing to pay more than the previous warm bodies - demand increased. Rent goes up.

It's a semantic game - both of us apparently agree that we are still on the supply/demand curve and it is behaving as expected. And that's my issue with this "report" - it restates a basic truth and does not make any attempt to bring us more data that would enable us to decide if this is a "good" rent increase or a "bad" rent increase. While there are always winners and always losers, rent increases by themselves are not bad as it just one indication of more economic activity.

Re:...and?

[MightyYar]

Well, I'm a registered Democrat, but whether you "believe" in supply and demand or not - it happens. This overly-simplistic report, in fact, does nothing except demonstrate supply and demand. NYC has a perpetual shortage of housing in desirable areas, but it also has perpetual construction. I don't know anything about Seattle - and if this report were written about Seattle it wouldn't help my ignorance because the report is ridiculously shallow. I'd be floored if AirBNB didn't increase rents where it operates - that is basic supply and demand. The question is: "What else does it do?"

Re:...and?

[thegarbz]

Every type of economic activity increases rents... like, all of them.

Hazardous facility opening directly across the road. Garbage dump opening next door. New airport runway expansion directs all planes right over your house.

Re:...and?

[thegarbz]

The entire thing becomes a self regulating loop.

A very poorly tuned loop which is why you see big discrepancies between cost of living and average income across all industries between different cities. In a really big macro scale you are right of course, but the reality is that people will experience significant stress long before the balancing acts set in which has a very big impact on society.

Re:...and?

[MightyYar]

Well, except on the Barbary Coast and the Caribbean.

Re:...and?

[MightyYar]

And in addition to this, people are not simply goods being rationally exchanged on an open market. They are often irrational, and most will fight change of any sort using any power they have available to them.

I'm a huge fan of free market capitalism. When you need a tool that will - on average - give you absolutely the most efficient market possible. It has allowed people to increase their standard of living to staggering levels.

With that said, sometimes pure efficiency and economic growth is not the end-all, be-all. Take food for example... at least for staples, this is definitely an area where you do not want wild swings in price or supply. You want a dampener, and a DC bias towards oversupply - even if on the whole we pay more for food than we would under a purely free-market system, and thus take a standard-of-living hit.

Housing has some built-in momentum that makes it a poor choice for an efficient market... for instance, terms tend to be a year - building in some dampening. Financing logistics and the realities of real estate make it hard for owners to quickly liquidate or add housing stocks. Responding to market demands with refurbishments has to be weighed against taking the unit(s) off of the market. And that's all before considering that people will resist change with their voting rights, organizational skills, and other powers they can muster. As you say, it's a very poorly-tuned system... wild swings and poor efficiency are built-in. Government interference probably still makes overall efficiency worse - but it's not as big of an impact as if the government regulated commodities.

Re:...and?

[rtb61]

It is as self regulating as boom and bust. The problem with boom and bust is it is very unstable and due to extremes built into cyclic events, inevitably the bust is terminal decline and societal collapse. Waffling about the simplicity of allowing markets to self regulate ignores the reality of socio-political instability, riots and revolutions, all part of that cycle. So you do not allow self regulation because it must be regulated in order to force stability into a system that is inherently unstable. Although if you want riots and revolution because you thrive in a market of mass murder and public executions, sure go for the boom bust cycle, with inherent development cyclic extremes and inevitable collapse.

Keep in mind the crowing achievement of capitalism, endless war and don't even try to deny it, it is inherent to capitalism, the placing of your capital worth over other people's lives.

Re:...and?

[jittles]

Every type of economic activity increases rents... like, all of them. New restaurants - increase rents. Jobs increase rents. So you flood an area with tourists and the rents go up? OK, in isolation that sounds bad - but what did all of that tourism money do to the local economy? If rents go up, doesn't that also encourage investment in the neighborhood? How can you just look at this one statistic in isolation? Cities were murdering each other to get the new Amazon headquarters... what would that do to rents?

Look at Vancouver, BC and I believe Toronto as well. Chinese millionaires looking to diversify their holdings and move money beyond Chinese government reach are snatching up units left and right and just rent them out as AirBnB properties. Of course that is going to drive up rent. Does it encourage more people to go to these cities? Probably not since most people have to pay the expense of flying, eating out, etc while they are on a trip. So they end up spending $200 for a weekend at an AirBnB instead of $300 at a hotel. But at what cost? Regular people living in those cities having to move further outside while hotel rooms sit vacant because AirBnB renters are flouting hotel regulations and the renters are bypassing hotel taxes. I will admit that AirBnB has tried to enforce hotel taxes in some areas, but they are still circumventing regulations. These regulations generally didn’t appear out of thin air to make it harder to run a hotel (though I am sure there are some that DID come to being in this way), but are generally around to guarantee the safety and quality of lodging to visitors from out of town.

Re:...and?

[MightyYar]

So maybe all of that is happening, but the point of my post is that we wouldn't know from this extremely limited analysis. All we know is that AirBNB increased rents in NYC by $86 over 7 years, or roughly $10/year. And that analysis is flawed because they make no distinction between part-time and full-time listings so they likely overstate the effect.

So I'm not making any judgements as to whether allowing AirBNB to operate is reasonable or not - simply pointing out that this study does not get us very far in that debate.

Re:...and?

[MightyYar]

Hazardous facility opening directly across the road.

You are playing a semantic game. It will still raise rents nearby as it creates new jobs. Yes, there will be both winners and losers - but in aggregate new economic activity will raise rents.

A better counter-example might be a giant robotic facility replacing a lower-volume manual facility, where the revenue might increase but total payroll goes down.

Re:...and?

[MightyYar]

If you want to really turn this into a semantic argument, I'm not interested in participating. We both agree that we are on the supply/demand curve, so whether demand went up or supply went down is not important. Let's move on.

Re:...and?

[Opportunist]

This already assumes that this tourist only comes because there is an AirBnB available and would not have stayed in a hotel, which now is lacking that revenue. Revenue that is also far higher taxed (and not only because, let's face it, a lot of AirBnB income never makes it onto a tax sheet).

But that doesn't even affect rents. It's simply fewer supplied apartments for rent with a demand that remains the same. How AirBnB affects the local economy aside of apartment renting, if at all, doesn't even enter the equation.

Re:...and?

[darkmeridian]

But we have zoning laws that regulate the use of land. We don't let people build hotels or conduct business activities in residential neighborhoods, for instance. AirBnB is essentially allowing residential neighborhoods to be used as commercial enterprises, and that's pushing up the rents "unfairly" to the extent that it's against the zoning laws.

Re:...and?

[swillden]

I live in Vancouver, the second most unaffordable city in the world. Because the city is so unaffordable, the hospitals have shut down wards due to the inability to attract staff. The situation is far too complicated to resolve with "Let the market sort it out" because of the constraints and illiquid nature of the medical system.

Are these hospitals free to set their own prices? I suspect not. Healthcare in areas with expensive real estate should naturally cost more than healthcare elsewhere, due to the increased cost of space for the facilities and increased pay to providers (since they need to be able to live in the area).

In general, price caps create shortages, and this sounds like an example of that fact in operation.

Re:...and?

[postbigbang]

Some areas do this-- require developers to do the upgrades necessary. Some just want more short-term tax base and look the other way.... leading to staggeringly rough strains on existing, decaying infrastructure.

There is little public policy guidance, and non-uniform implementations of it. The entire HOA debacle is a prime example of a good idea gone horribly bad. Many HOAs go bankrupt, leaving things like storm water management, sewage treatment and flow, and other basics hung on cities and counties to take care of.

The over-arching problem is greed and short-sightedness.

Re:...and?

[MightyYar]

I'd still consider renting to be commercial activity, even if it is allowed by zoning. I don't have a huge beef with zoning in general, but let's not pretend it is inherently fair in some way - it's basically NIMBY encoded into law... a way for people to protect their real estate investments. The only thing that makes it tolerable is that it grew out of a nominally democratic process.

Re:...and?

[Impy the Impiuos Imp]

I wonder if this kind of app-based alternative locator could be applied to taxies to lower costs. Someone should look into this.

Re:...and?

[MightyYar]

, if at all, doesn't even enter the equation.

Forgive me if I don't simply take your word for that. It's not that you don't seem like a reasonable guy - I'd just like to use data rather than theorizing. The $10/year increase in rents correlated to AirBNB in the study are not exactly breathtaking in any case. It would not surprise me if each apartment generated $120/year in additional recurring revenue to compensate. It also wouldn't surprise me if it actually resulted in less revenue. This isolated datapoint gives us very little to go on, and isn't a very big number in any case.

Re:...and?

[swillden]

. So you flood an area with tourists and the rents go up?

There's no reason to think there are more tourists visiting NYC. Occupancy rates in hotels are down, year-over-year.

Clearly, tourists are choosing cheaper AirBnB stays over hotels. I can see two reasons that the AirBnBs are cheaper, one the hotels can do something about, one they cannot. The one they can do something about is the fact that AirBnB is cheaper in part because it doesn't provide all of the same amenities. When you stay at an AirBnB you do not get daily maid service, and in most cases you're expected to leave the place roughly as clean as you found it. In addition, you don't get room service, concierge service, checkin is a little more complicated and less convenient, etc. Hotels can choose to make these amenities optional or simply stop offering them, if that's what tourists prefer (business travelers and wealthier tourists will continue wanting them).

The other is regulation, and that's harder for hotels to do anything about. Many people in this thread have talked about taxes, but the real issue is rent control. Renters of rent-controlled apartments are paying below-market rates for the space, so they can rent them out for below-market rates and still make a profit.

So my guess is that this is a direct result of the market-distorting effects of rent controls. Differences in taxation and amenities offered are part of it, but I'll bet they have much less effect than rent control.

What NYC should really do is abolish rent controls. Failing that, they should probably remove rent controls from apartments that are sub-let.

Re:...and?

[jittles]

So maybe all of that is happening, but the point of my post is that we wouldn't know from this extremely limited analysis. All we know is that AirBNB increased rents in NYC by $86 over 7 years, or roughly $10/year. And that analysis is flawed because they make no distinction between part-time and full-time listings so they likely overstate the effect.

So I'm not making any judgements as to whether allowing AirBNB to operate is reasonable or not - simply pointing out that this study does not get us very far in that debate.

Well I agree that the study is flawed. We don’t know exactly what AirBnB does to the economy of an area, but I think it should be readily apparent that it does affect rent when the units are being used as 24/7 AirBnB rentals as opposed to rental properties. They didn’t need to do a study for such a limited report. And there are probably areas where it actually benefits the economy, too. There are scenic areas where people own cabins that they personally probably only use a couple of months out of the year. Those types of areas do not usually have a lot of resort space. Therefore, renting out the cabins to tourists probably does increase the total spending in the economy and helps to offset the cost of owning the cabin itself.

Re:...and?

[MightyYar]

Have a nice day!

Re:...and?

[ranton]

Instead they are forced out and replaced with workers who can demand higher wages due to skills/experience. And then they cycle repeats.This is bad for everyone.

How is this bad for everyone? You seem to have described a self-repairing cycle that works quite well.

Re:...and?

[ranton]

It's rather silly to expect homeowners to pay the tax rates of a multinational hotel chain to rent out their home or apartment for a couple of months while they go on a cruise or something

Why is that silly? Platforms such as AirBnB would simply take the taxes out of the rental income and assist with the filings (if they don't want to lose their clients that is). Now you have hotels and AirBnB operating on a level playing field.

Re:...and?

[MightyYar]

I'm violating all my Slashdot sanity rules, but why not - it's lunch.

Semantic argument - go!

The supply/demand curve can be approximated as linear in the tiny little range we are discussing. This is because the average rent in Manhattan/Brooklyn is in the $2000 - $3000 range and according to the study we're talking about a $10 delta from that each year.... so our Y axis is moving in the 0.3 - 0.5% range due to AirBNB. Our X axis is dealing with a delta of around 10,000 units out of more than a million between Manhattan and Brooklyn - so we are in the 1% range. A delta of 1% along the X axis and 0.5% along the Y axis is going to follow something very similar to a linear trend.

Given a linear trend, it does not matter whether you slide up the chart because you increased demand by 1% or decreased supply by 1%. It simply does not matter - it is a purely semantic game and you are arguing about a fact that just has no consequence.

If we were talking about the hotel market and the effect of AirBNB on the price or occupancy of hotel rooms, then hell yes, the added supply of 10,000 rooms would be very significant. But we're not, so you are calling me names for no good reason.

Re: ...and?

[david_thornley]

Enron was lobbying the State of California to do stupid things that would get Enron more money, and Enron was plenty dishonest on its own. The fiasco had a lot to do with Enron.

Re:...and?

[david_thornley]

homeowner to recoup some costs of a trip or vacation by temporarily renting their home into a multi-property commercial enterprise that *is* essentially a commercial hostel service competing with hotels.

This is not the economic model being complained about. The problem in TFS is that people are turning apartments into full-time short-term rentals. We want to consider what will happen to your hypothetical homeowner, but he or she isn't the real problem.

The other thing is that AirBnB doesn't really operate a commercial hotel service in the normal sense. A hotel has a strong incentive, for example, to keep meth labs out, and to keep guests from being public disturbances. AirBnB doesn't have those incentives. Hotels are zoned differently from residential neighborhoods, and there's reasons for that. AirBnB is undercutting hotels partly by externalizing costs.

Re:...and?

[david_thornley]

Part of the regulation is for the benefit of residents, and removing it causes problems. Hotels have some degree of surveillance over guests, and can try to stop someone from, say, setting up a meth lab in a hotel room. A hotel can be held liable for excessive noise or other disturbances. Hotels are not normally in residential areas, so residents don't have the disadvantages that come with lots of short-term renters in their neighborhood.

To put this another way, AirBnB saves money by imposing costs on the community. That isn't good.

Re:...and?

[david_thornley]

No a hazardous waste facility opening in a residential area is going to push rents down. Nobody wants to live near it. If it hires more people, they'll be willing to commute farther rather than living next to the facility.

Re:...and?

[MightyYar]

Have you ever lived in NYC? Sure, across the street it will push rents down. A block away they won't even be aware of its existence.

Go out to the suburbs and as soon as you drive out of sight of it, the rents will all go up to accommodate the new workers.

Re:...and?

[david_thornley]

There's good reason for people to want to protect their real estate investments. Once you own a house, moving is very expensive. (A couple of friends of mine had a financial problem and looked into moving to a smaller home. Turned out that, when they went through the details, they wouldn't save any money for the time they were concerned about.) Anything that lowers the value of living in the neighborhood either has to be endured or the homeowners have to spend a lot of money.

As a society, it seems we favor home ownership, and making people more secure in their home purchases helps that. Also, making residential neighborhoods in general less pleasant to live with isn't a good thing.

Re:...and?

[Hognoxious]

Every type of economic activity increases rents... like, all of them.

Apart from building more accommodation. And improving transport links.

Re:...and?

[redlemming]

The problem is that individuals' wages don't increase because of rent increases. Most people can't go to their boss and say "hay, my landlord put the rent up, I need you to give me a raise to pay for it."

Instead they are forced out and replaced with workers who can demand higher wages due to skills/experience. And then they cycle repeats.

This is bad for everyone.

Rent control in the form of government price fixing is not the solution. Government price fixing can always be expected to cause bad problems over the long term.

The solution is to let the market set the price, but to not allow rent to increase for a fixed number of years once the contract is signed (or perhaps to fix the rate of increase to reflect some some inflation amount). 5-10 years would be reasonable. The logic here is that we want market forces to work over the long term, but we don't want people to have to move too often. Too much disruption in people's lives is not good for society or for the economy - and moving is always disruptive.

Yes, this slightly reduces the maximum short term profits landlords can get from their property, but it's not the government's job to maximize profits of the wealthy, it's the government's job to look out for the long term best interests of society. Landlords will still make plenty of money - in fact, they'll probably do better over the long term, on average, then they will with traditional rent control systems that involve government price fixing - and there will be more incentive to build additional units, so the overall cost of housing will be lower for the public.

Land ownership should be a long term investment, people that want short term gains can gamble on the stock market.

Re:...and?

[MightyYar]

Good points, though I think improving transport links will still increase rents wherever the people commute from. Put in a link from Staten Island to Midtown and the rents in Midtown might drop slightly, but the rents near the new station on Staten Island will go through the roof.

I guess I should say more generally that economic activity which generates demand but does not increase supply will tend to increase rents.

Re:...and?

[MightyYar]

There's good reason for people to want to protect their real estate investments

No argument there. People are working in their self-interest. I have attended zoning meetings and proposed changes based on protecting my own property. But that doesn't mean the changes that I pushed for were "fair" - they simply protected my self-interest.

Re:...and?

[MightyYar]

That presumes an even distribution. It wasn't. FTFA: Airbnb listings were heavily concentrated in parts of Manhattan and Brooklyn and had a greater impact on these neighborhoods.

That might affect the x axis somewhat. We're still talking about only 10,000 units in the most densely populated part of the US. The rents are even higher in those locations, so I was probably very conservative with my numbers in the y axis and the real effect is probably even less than the 0.3-0.5% that I stated.

You seem to think "linear" means 1:1 ratio.

No, I don't think it means a 1:1 ratio. I mean it seems like the relationship between supply and demand is going to be more or less linear in such a small region. Whether we adjust supply or adjust demand won't significantly change whatever discussion we have going forward from that point. Both will raise prices, and by a similar amount. You have a specific, hard number to work with - you don't need to wax philosophical about whether demand went up or supply went down - it's not germane to the discussion.

Re:...and?

[MightyYar]

In fact, if you take their 1%:1.58% over a seven year period number as accurate, it is very close to my low estimate of 0.3% based on a $3000/month rent. The effects here are quite small.

Re:...and?

[Hognoxious]

I think improving transport links will still increase rents wherever the people commute

It might just move things around a bit like you say.

But (and this is oversimplifying) consider that you can double speeds. Assuming that the real limit for what people will put up with is the transit time, your catchment area is twice as wide but is now four times the area.

To take an absurd example, what if teleportation via some kind of stations was an actual thing[1] and it took five minutes of setup time and cost twenty bucks to do one hop anywhere within a thousand miles. I think rents in Manhattan will go down more than rents in Burgsville Idahoma will go up, because there's also Villesburg Michylvanio and plenty of others.

[1] Yes, I know Elon Musk is working on it.

Re:...and?

[MightyYar]

Haha, yes, well... teleportation would be a game changer :) Even more than Musk's self-driving cars, I'll let others do the beta testing!

Back in reality, the problem with all forms of public transit in low density areas like suburbs is that the catchment area can be much larger, but the density is ridiculously low. So you put in stations with giant parking lots and instead of walking to the train people drive, increasing their commute times. The speed of the train becomes less and less important. So in theory you could put up a new train station out in the 'burbs with city-style housing density and the rent balance would go down as you say - but practically this is not what happens as the existing 'burb dwellers go into a full-court zoning press. I live in a suburb within walking distance of Philadelphia, and they only just now zoned the areas around the train stations as mixed-use... and even then, the buildings are capped at 3 or 4 stories. The stations have been there for over 100 years and serve something ridiculously low like 400 people per day (they also will not allow a parking garage to be built, so the small surface lot and residential streets are all of the parking that is available).

Re:...and?

[david_thornley]

I haven't lived in New York City. Have you lived in a major inland metro area? Nobody's going to want to live near the facility, and it really isn't going to add all that many workers to the metro area.

Re:...and?

[MightyYar]

NYC seemed more germane to the discussion than some arbitrary city. If housing prices aren't an issue, than AirBNB isn't going to have much effect one way or another. If housing prices are an issue, then people will be living wherever they can afford - including immediately adjacent to industrial sites.

I have a colleague who was having trouble selling his house. From the corner of his backyard, you can see the local nuke plant off in the distance. His neighbors don't all have a clear view, and the houses without a view had no trouble selling. People are essentially ignorant of what they cannot see, even out in the sticks.

I got mine

[fluffernutter]

It shouldn't be called the gig economy, it should be called the "I got mine" economy. I'm also partial to the "screw you" economy.

Re:I got mine

[djinn6]

If you can't afford rent, it's not the landlord's responsibility to lower the rent for you. Nobody has a birth-right to live in Manhattan, one of the most expensive places in the world. Besides, let's say the landlord does let you have it for cheap, then they're just screwing other potential renters.

Re:I got mine

[fluffernutter]

This isn't about capitalism, this is about a company using an app to game capitalism in their favor. You could outlaw AirBnB and still have fair capitalism. These kinds of downsides are what come when capitalism is not regulated correctly.

Re:I got mine

[Peter P Peters]

It shouldn't be called the gig economy, it should be called the "I got mine" economy. I'm also partial to the "screw you" economy.

Isn't the "I got mine" economy want we ultimately want? The ultimate democratic/capitalist system where everyone can offer goods and services, not just those with licenses/permits/artificially restricted access?

Re:I got mine

[ooloorie]

This isn't about capitalism, this is about a company using an app to game capitalism in their favor.

No, this is about a company making a market more efficient, by bringing together buyers and sellers.

You could outlaw AirBnB and still have fair capitalism.

No, you could not. Capitalism means free markets, and outlawing AirBnB is incompatible with free markets.

Re:I got mine

[ooloorie]

it should be called the "I got mine" economy.

True. We call that property rights. What you want is "I'm gonna take yours, by force if necessary".

I'm also partial to the "screw you [you fucking evil totalitarian socialist]" economy.

FTFY

Re:I got mine

[Opportunist]

You still didn't get the difference between equal opportunity and equal outcome, did you?

Re:I got mine

[ooloorie]

You still didn't get the difference between equal opportunity and equal outcome, did you?

I'm glad you finally acknowledge that there is a difference; took you long enough.

However, I'm not in favor of "equal opportunity" (which is, in fact, a government policy intended to produce equal outcomes). Nor do I generically endorse "equality of opportunity" (which progressives often use as a synonym for "equal opportunity").

I specifically only consider strict equality under the law, private property rights, and freedom of association to be acceptable policies.

Re:I got mine

[Rockoon]

No, you could not. Capitalism means free markets, and outlawing AirBnB is incompatible with free markets.

Even if one holds the opinion that not all markets should be free, can anyone give a reasonable answer as to why this market shouldn't be?

Just from a property rights perspective, its hard to argue that the owner of a property shouldn't be allowed to come to a mutual agreement with any willing party about who may sleep in a particular room tonight.

If anything, Hotels have a right to argue that they are over-regulated, while the argument that all their market pressures should be met with ridiculous regulations put upon the pesky newcomers is absurd.

Re:I got mine

[Dragonslicer]

It shouldn't be called the gig economy, it should be called the "I got mine" economy. I'm also partial to the "screw you" economy.

I don't think it's a "gig economy" thing. The "Me Generation" has been around for decades.

Re:I got mine

[ooloorie]

Even if one holds the opinion that not all markets should be free, can anyone give a reasonable answer as to why this market shouldn't be?

Why are you asking me? I believe AirBnB should be able to operate freely.

Re:I got mine

[Hognoxious]

Just from a property rights perspective, its hard to argue that the owner of a property shouldn't be allowed to come to a mutual agreement with any willing party about who may sleep in a particular room tonight.

I bet you'd find it much easier to argue if the property in question was near you and they turned it into a meth lab, knocking shop, or a frat house.

Re:I got mine

[david_thornley]

No, this is about a company making a market more efficient, by bringing together buyers and sellers.

And ignoring regulations that make it better for the rest of us.

No, you could not. Capitalism means free markets, and outlawing AirBnB is incompatible with free markets.

Capitalism doesn't mean everything is a free market. We've outlawed slave markets, for example, and historical records don't show a complete failure of capitalism. There's lots of things whose markets are restricted in the US, including sex workers, various drugs, some firearms and other weapons, and to a certain extent things that are falsely advertised. Yet we seem to be in a capitalist economy.

Re:I got mine

[david_thornley]

Which means that, if large groups of the population are oppressed for long periods of time, it's fine with you as long as it's not government-enforced. That's not a universally shared view.

Re:I got mine

[ooloorie]

Which means that, if large groups of the population are oppressed for long periods of time, it's fine with you as long as it's not government-enforced.

Without government intervention, it is impossible to oppress large groups of the population for long periods of time; every time large groups of the population have been oppressed for a long time, it has been the fault of government (and in the US, usually the fault of Democrats).

That's not a universally shared view.

Well, that's because many Americans are utterly ignorant of what it is like to be oppressed.

Re:I got mine

[ooloorie]

And ignoring regulations that make it better for the rest of us.

The regulations being used against AirBnB make it worse for the everybody except a small number of special interests.

We've outlawed slave markets, for example, and historical records don't show a complete failure of capitalism.

You got it backwards. Slaver markets were not a free market arrangement. Slave markets were a creation of the US government, a creation that explicitly robbed people of the fruits of their labor. When we abolished slavery we did it not by "outlawing" it, but abolished the laws that created it. The people that divided people up by race and advocated robbing them of the fruits of their labor were the same then as now: Democrats.

There's lots of things whose markets are restricted in the US, including sex workers, various drugs, some firearms and other weapons, and to a certain extent things that are falsely advertised. Yet we seem to be in a capitalist economy.

Well, as I pointed out before: both Marx and you like to equivocate about the term "capitalist", using it in different meanings (corporatist, crony capitalist, free market). I corrected you on this before. Stop equivocating. The US is a corporatist, progressive social market economy with a massive public sector, and that is hurting particularly minorities and causing the middle class to stagnate. If the US actually were a free market economy, people would be doing a lot better.

And the criminalization of drugs, sex work, some firearms, and many other things has hurt people badly, in particular minorities. It has been a major driver of racial disparities and inequality. That is what you advocate: screwing over minorities in the name of progressive ideology.

Re:I got mine

[david_thornley]

The regulations being used against AirBnB make it worse for the everybody except a small number of special interests.

Or anybody who wants to live in a stable residential neighborhood. Hotels bring in large numbers of transients, and transients generally don't care about their neighbors. They can throw loud parties late at night, litter, and make the neighborhood less safe, and I'm not even talking about the malicious ones. When these people are packed into hotels, the hotel needs to keep some sort of lid on them and can be held responsible. Moreover, they're in commercially zoned areas, not residential.

Slave markets were a creation of the US government,

Actually, no. Slavery was enforced by the US government, which didn't create it. Slave markets were typically private sector.

both Marx and you like to equivocate about the term "capitalist", using it in different meanings

Not in different meanings, but "capitalism" is the economic system that has won. Private ownership of the means of production, and economic progress by individual initiative rewarded by money. There's different varieties of capitalist systems, of course. Similarly, if I were to refer to "precipitation", you'd doubtless be complaining that I used it to describe gentle rain, hard rain, hail, snow, and freezing rain.

And the criminalization of drugs, sex work, some firearms, and many other things has hurt people badly, in particular minorities. It has been a major driver of racial disparities and inequality. That is what you advocate: screwing over minorities in the name of progressive ideology.

Sex work has been largely illegal for a long time. The prohibition of drugs may have started as part of progressive ideology, but it isn't now. Progressive idealism currently means at least decriminalizing sex work and allowing more access to drugs. Legalization of marijuana, in particular, has been a progressive stance all my life.

Re:I got mine

[ooloorie]

Or anybody who wants to live in a stable residential neighborhood.

If you want to live in a stable residential neighborhood, pay for it: HOAs and landlords are perfectly entitled to prohibit AirBnB entirely on their property.

Actually, no. Slavery was enforced by the US government, which didn't create it. Slave markets were typically private sector.

So? How does "private sector" factor into anything? Almost all economic activity under fascism is private sector and none of it is free market. All the corrupt dealings of US politicians are private sector.

Slavery certainly was a private sector activity, but that private sector activity was caused by the US government and wouldn't have existed without the US government. Even progressives like to point out that governments create free markets. Slavery was caused by policies adopted by the US government; in a free market, slavery doesn't exist. And your attempt at confusing "private property" and "free markets" doesn't change that fact.

Similarly, if I were to refer to "precipitation", you'd doubtless be complaining that I used it to describe gentle rain, hard rain, hail, snow, and freezing rain.

You: "Precipitation is bad. Just look at those one pound hailstones that kill people and flatten crops. To be safe, we should all live in a desert where precipitation doesn't occur!"

Me: "You know full well that hail is atypical precipitation, so stop equivocating and say what you mean: hailstones are bad."

Not in different meanings, but "capitalism" is the economic system that has won. Private ownership of the means of production, and economic progress by individual initiative rewarded by money.

That describes everything from free markets to fascism. And you know that too, which is why you persist in using such imprecise language and keep confusing things that have little to do with one another.

The prohibition of drugs may have started as part of progressive ideology, but it isn't now. Progressive idealism currently means at least decriminalizing sex work and allowing more access to drugs.

So you agree then that progressivism a century ago stood for sterilizing homosexuals and minorities and demonizing sex work and drugs, while now it embraces homosexuals, minorities, and drugs while demonizing white males and religion. Now think about what that tells you about progressivism as an ideology.

Re:I got mine

[ooloorie]

Even progressives like to point out that governments create [strike: free] markets.

Typo, corrected.

Re: But how much did they save?

[Anonymous Coward]

Yes, the average long term renter in Manhattan doesn't also need 12 days of local short term accommodation per year, Airbnb or otherwise.

Re:Doesn't surprise me

[Ichijo]

parking on the lawns...

If your neighborhood has lawns, it's probably being subsidized by those without lawns. Beggers can't be choosers!

What about other zoning laws?

[Ichijo]

In those same areas, how much are rents inflated by minimum parking requirements, minimum setbacks, maximum floor area ratios, and height limits? I suspect that Airbnb is a drop in the bucket compared to these other sources of increased construction costs and limits on housing supply.

What drives up prices...

[macraig]

... are people who are both able and willing to pay excessive prices. Those prices wouldn't exist if the sellers didn't already know they'll have buyers. Then for the next guy the price goes up a little again if the economy is doing well-slash-the Dow Jones is up-slash-insert bogus economic trend indicator here. The sellers are almost certainly greedy and nothing but self-interested, but collectively saying NO to greed is the only way to end it. Recessions are in fact the beginnings of a greed rollback, but they fail every time because the One Percent retaliates against those who are dependent upon them and makes them feel their pain, citizens and governments cave, and the One Percent returns to its usual rate of exploitation.

Re:What drives up prices...

[PacoSuarez]

I am in the 1%. Can you explain to me what I am doing that is so wrong, other than having a successful career? This mindset that people that are doing well are necessarily exploiting the people who are not doing well is poisonous.

Of course people that are wealthy can tolerate recessions better than those that don't have any savings. I don't like very many expensive things, so I live under my means. The main thing that money buys me is peace of mind.

Re:What drives up prices...

[Opportunist]

What allowed you to have that successful career?

Short term rental should have restrictions

[mark-t]

Rental periods of less than a single calendar month in length should force the entire building to be qualified as a hotel, and require that there be no long term rental or ownership of any units anywhere within the entire building, beyond at most what is necessary for any dedicated management and/or maintenance staff.

Just IMNSHO....

Re:Short term rental should have restrictions

[k6mfw]

True but many condo owners go ahead and do it anyway in clear violation of HOA rules. Probably like Uber (a non-regulated taxi service), Airbnb is an unregulated hotel but then that's what all this get rid of guvmint regulations is all about (without thinking the consequences).

Re:Short term rental should have restrictions

[mark-t]

I have no problem with it being unregulated, per se.... I just think that short term rentals should exclusively apply to all units within a building (other than those that may be required for on-site management and maintenance staff). If a person wants to run a B&B, they should be able to with a minimum of fuss.... but it should have to apply to the entire building, not just individual units in it. This makes in unviable when there are multiple owners, such as in a condo situation, because if even a single owner find out that another owner is using short term rentals in violation of their strata code, they can be reported, fined if it happens again, and ultimately even forced to move out because the repeating fines will make it prohibitively expensive to continue to live there.

Re:Short term rental should have restrictions

[swillden]

A better solution, and one that gets right to the heart of the market distortion that makes AirBnB rentals more economical than hotels is to permanently remove rent controls from any apartment that is used for short-term rentals. Landlords will be incented to turn in anyone using their rent-controlled apartment for AirBnB.

An even better solution is to abandon rent controls entirely, but that's politically infeasible.

Re:Short term rental should have restrictions

[david_thornley]

Hotels sometimes do have long-term tenants. You'd want exceptions for them.

Re:Short term rental should have restrictions

[eionmac]

What if I only rent out, when I AM on holiday elsewhere! Thus for one month of year when all permanent tenants are elsewhere it has a total short term rental. It is still not a hotel.

Rent drives up housing

[Pfhorrest]

Just like AirBnB drives up the cost of longer-term rentals, the existence of rent in the first place drives up the cost of homeownership.

Rent (including interest, which is just rent on money) is the core mechanism that perpetuates and amplifies the divide between rich and poor, turning what would otherwise be a truly free market into exploitative capitalism.

Re:Rent drives up housing

[MDMurphy]

And in outlying areas, home building drives up the price of farmland.

Re:Rent drives up housing

[ShanghaiBill]

And in outlying areas, home building drives up the price of farmland.

And the shortage of farmland drives up the price of off planet O'Neill Cylinders.

Re:Rent drives up housing

[Peter P Peters]

what would otherwise be a truly free market

Sounds a bit like the only true Scotsman...
The only 'true' free market is a jungle where the strong take what they want and eat the weak. I don't think anyone really wants that, so some level of regulation is required to produce the highest quality outcomes. The question is which level/type of regulation produces the best outcomes? Funnily enough we have about 200 real world examples of systems we can compare to help us work this out.

Re:Rent drives up housing

[Pfhorrest]

That is not a truly free market because the important freedom in a free market is a “freedom from”, not a “freedom to”. My complaint is that what we have is too much like that, not too little.

Re:Rent drives up housing

[Pfhorrest]

To elaborate on the post I made a minute ago:

The important rights in a free market are the claim rights that limit others' liberty to act upon ourselves and our property, and the immunity rights that limit others' power to change who has what rights and liberties. My complaint is specifically that we are not adequately immune from certain powers of contract that enable the creation of new claims obliging the payment of rents (including interest), without which what are currently rendered as such rental contracts would instead have to be refactored as sales contracts.

Re:Rent drives up housing

[Misagon]

That is not always the case.

In my area, it is much easier for a poorer person to get admitted to rent a home than to be approved a loan to buy a house or condominium.
After that, the monthly cost (rent or mortgage payments + payment to the coop) is roughly the same although it varies by neighbourhood.

Re:Rent drives up housing

[Peter P Peters]

That is not a truly free market because the important freedom in a free market is a “freedom from”, not a “freedom to”. My complaint is that what we have is too much like that, not too little.

'Freedom from' is a regulated market because only regulations allows protections. A true, true free market is 'freedom to', which is effectively a jungle

Re:Rent drives up housing

[Pfhorrest]

Adam Smith himself insisted that for a market to be free it must be well-regulated. Freedom is not the absence of regulation but the presence of the right kind of regulation.

Re:Rent drives up housing

[Peter P Peters]

Adam Smith himself insisted that for a market to be free it must be well-regulated. Freedom is not the absence of regulation but the presence of the right kind of regulation.

The problem there is that America has a freedom fundamentalism element that doesn't understand such things. Right now everything is boiled down into free = good, regulation = bad.

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[account_deleted]

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A crock of !@#$

[paulxnuke]

>> average monthly rents increased by $398 between 2009 and 2016, of which $86, or 21.6 percent, was a result of Airbnb's presence

$400 / month over 6-7 years in NYC isn't that shocking (it wouldn't be in Seattle, $100 / year for apartments that only millionaires could afford in NYC is common in quick-growing areas.)

How do they attribute 21.6% of that to Airbnb again? TFA tried to make it sound all scientific, but really, guys? We need a doctor with a flashlight to explain it better.

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[account_deleted]

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It has nothing to do wtih too many people?

[filesiteguy]

I was in the Manhattan slum last year. Way too many people No wonder rents are high. I doubt AirBnB (which I used for a few days) had much to do with it.

And this is why we regulate hotels

[rsilvergun]

and subletting. Because the rich people living in New York still want services from Working Class people who shouldn't have to live 4 hours from where they provide those services.

And yes, this means we sometimes tell businesses to take a flying leap when their business is not conducive to the overall health and wellbeing of society. It's like the Olympics. No city in it's right mind would host it. Not all economic activity is 'good'.

Re:And this is why we regulate hotels

[MightyYar]

The Olympics is a competitive bid, and NYC bid on it in 2012.

Here's a scary thought

[rsilvergun]

AirBnB turns your tourists into part of your Urban Sprawl problem. The Hotels are usually in a district (especially nice ones) near the city's major amenities. AirBnB breaks that. If folks are staying where ever and driving a few hours in a rental (fine since they're on vacation) expect to see traffic shoot up.

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[account_deleted]

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Landlords and the City Cause Increased Rents

[DatbeDank]

Do you want to know what really causes rising rents?

Landlords. These leeches serve no purpose but to suck off the productive value from the real working class. Next, they remove available housing stock and drive up property costs forcing the working class people to either rent or leave town if they want to own.

You'll always hear this whiny reply (most likely from landlords) that they help gentrify neighborhoods and make housing affordable. Really? Have you ever seen a landlord do more than the bare minimum to keep a property looking good? This is at all levels from section 8 all the way to the luxury brands. Doesn't matter, because any upgrades mean more money to charge for rent! As for affordable housing, these scumbags are the reason property values are so high. Less free housing stock = higher prices for people who simply just want a home to live in.

But wait, there's more in this unholy cirlce jerk! The city then gets its own pecker yanked because this drives up property values. High property values equal higher property taxes! More tasty tax dollars for do-nothing bureaucrats.

Landlords and the city than through the fun of zoning laws keep housing stock at a bare minimum. What incentives are there for new high-density housing when that will drive down property values? The city and the landlords definitely do not want that!

Please note that I said landlords, not property developers! Property developers who build beautiful and architecturally stunning apartments and condos for sale have to contend with cities and landlords who do not want more housing stock.

The next rent check you cut to a landlord, you can thank him (and to a lesser extent city hall) for the reason your rents are high.

Re:Landlords and the City Cause Increased Rents

[Pfhorrest]

I wish I could upmod you but I've already posted upthread. It's heartening to finally see someone else who gets it.

Re:Landlords and the City Cause Increased Rents

[Peter P Peters]

Do you want to know what really causes rising rents?

Landlords

I'm imagining your view of a 'landlord' is like the Monopoly man Rich Uncle Penny Bags...
Not everyone wants to own property, rental properties serve a purpose, the issue is simply supply and demand.

Re:Landlords and the City Cause Increased Rents

[ooloorie]

Landlords. These leeches serve no purpose but to suck off the productive value from the real working class.

If you think that buying is cheaper than renting, why aren't you buying?

Of course, the median condo price in Manhattan is about $2 million. That costs you about $3000 in property taxes and $7000 in mortgage payments per month. Median rent for Manhattan is somewhere around $4500.

Landlords and the city than through the fun of zoning laws keep housing stock at a bare minimum.

What the city does is determined by voters, not landlords.

Re:Landlords and the City Cause Increased Rents

[buddyglass]

How would you have rental space at all without landlords? Someone has to own the property if the renter doesn't, right? Or is your preference to have no rental space at all? That seems unrealistic.

Re:Landlords and the City Cause Increased Rents

[DatbeDank]

Landlords. These leeches serve no purpose but to suck off the productive value from the real working class.

If you think that buying is cheaper than renting, why aren't you buying?

Of course, the median condo price in Manhattan is about $2 million. That costs you about $3000 in property taxes and $7000 in mortgage payments per month. Median rent for Manhattan is somewhere around $4500.

Landlords and the city than through the fun of zoning laws keep housing stock at a bare minimum.

What the city does is determined by voters, not landlords.

I very much own. Part of the benefits of owning several businesses.

Why is the median condo price about $2million? Because of scum bag landlords and real estate investors are hoarding all of the available units. Remove these parasites and watch housing stock increase.

Then add more units so people can own and build real value. Not parasite's value.

Re:Landlords and the City Cause Increased Rents

[DatbeDank]

How would you have rental space at all without landlords? Someone has to own the property if the renter doesn't, right? Or is your preference to have no rental space at all? That seems unrealistic.

You wouldn't be renting. You would be owning and building your own equity. It takes 1 month to sell and close.

Re:Landlords and the City Cause Increased Rents

[ooloorie]

Looks to me like with you, it's always "scum landlords", no matter what the facts are.

In any case, NYC is governed according to how New York voters, both renters and owners, want to govern it. The population of "scum landlords" is too small to change the outcome of elections.

CAGR

[aaarrrgggh]

3% CAGR exceeds inflation, but not by that much.

I don't understand

[Archfeld]

How does an increase in the number of units on the market drive the price UP ? It would seem to me that greater available number of units would force the prices down. I am obviously missing something here...

Re:I don't understand

[ooloorie]

AirBnB customers compete with renters. And they compete rather well because between rent control and renter protection laws, AirBnB customers likely pay more and are less hassle.

Re:I don't understand

[Archfeld]

AHH I had not thought of it that manner. Perhaps the traditional landlords should consider competing with AirBnB for short term rentals as well as the traditional market.

Re:I don't understand

[ooloorie]

AHH I had not thought of it that manner. Perhaps the traditional landlords should consider competing with AirBnB for short term rentals as well as the traditional market.

AirBnB is just a market maker, so that's what's happening (to some degree): traditional landlords move out of the long term rental market into the short term rental market, and they use AirBnB to do it. However, it's not a big effect because the short term rental market has its own problems (it isn't to blame for NYC's insane rents).

The main effect of overregulation of the rental market is condo conversions and lack of investment into new rental property. And that mostly happens with small landlords because big landlords don't care about the overregulation or bad renters: they can amortize the cost of legal staff over hundreds of properties.

Re: But how much did they save?

[ooloorie]

Not sure what he looked at, but the average rent in SoHo is about $5000 and in Chelsea about $4200. So AirBnB rental rates are comparable to market rates for long term rentals.

Re:Why does the NY times hate capitalism

[ooloorie]

Why does the NYT hate capitalism?

(1) Free markets and competition are killing newspapers and journalists are scared shitless.

(2) A crony capitalist (Carlos Slim) owns a significant stake in it, and he certainly hates free markets.

No...

[Actually, I do RTFA]

So does that mean some hotels will close and be reconverted as apartments, driving rent down ?

Nope. Regulatory issues aside (which wouldn't be a problem in NYC), the fact that AirBnBs are driving up rents means that the hotel rooms are still more profitable than rentals.

Foreign Buyers

[speedplane]

Ha... AirBnB raises rents in NYC... how about all of the foreign buyers in China and Russia that buy apartments 100% in cash without ever seeing them or living in them. Maybe AirBnB is good or bad, but they are a drop in the bucket compared to others.

yeah, but...

[buddyglass]

The report said that Airbnb's influence cost New Yorkers $616 million in additional rent ...

Three questions:

1. How much did New Yorkers earn from renting their property through AirBnB?
2. How much did tourists to New York save from not having to pay exorbitant hotel prices?
3. How many more tourists came to New York (and spent their money at shops, etc.) because it was possible to rent a place (for less money) through AirBnB?

Re:yeah, but...

[buddyglass]

Personally, I would not object to a law forbidding anyone from renting (on AirBnB) a space they don't personally occupy at least 50% or more of the time. It's my understanding the current NYC law goes way beyond that. I agree with those who support making it impossible for someone to purchase a building, or a condo unit, simply to use it as an AirBnB rental space 100% of the time. That is, unless said person is willing to collect hotel taxes from their short-term renters.

On my last family vacation to NYC I stayed in an AirBnB in Washington Heights owned by a couple with two kids, both teachers. They were in Israel for the summer visiting family and rented out their place (with all their stuff in it) to help finance the trip. Staying there saved me at least $150/night over a two week trip and put money directly into the pocket of "real New Yorkers". Not some big landlord or hotelier.

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People running cities want the Olympics

[rsilvergun]

because it's a great opportunity to make a ton of money off graft. People _living_ in cities do _not_ want it. Even the local businesses who've long since figured out that they get screwed paying for it in higher taxes while often losing the extra business to pop up competitors.