Short-term holiday rentals should be unattractive when compared with long-term rentals and have a minimal impact on the rental market, a report commissioned by Airbnb has shown.
The holiday rental platform wants to use the report, by SGS Economics and Planning, to regain control of its marketing message and allay fears it had negatively impacted housing markets in Sydney and Melbourne.
“Broadly, in Sydney and Melbourne, it is not financially beneficial to host a property on Airbnb instead of renting to a long-term tenant,” the report states.
Airbnb told Domain it would prefer to be seen as a way to supplement homeowners’ incomes, rather than a bogeyman looming over the rental market.
“For too long, this debate has been muddied by back-of-the-napkin analyses and unreliable data,” Australian head of public policy Brent Thomas said.
“This landmark report confirms Airbnb is simply not a significant factor in the housing market and will help inform policy makers considering how best to regulate home sharing.”
Report co-author Terry Rawnsley said the report used a suite of Airbnb’s own data, rather than using scraped data from third parties.
“They’re trying to get some high-quality data out there,” Mr Rawnsley said.
While revenues were steady in Sydney at about $5000 a year, they had been in decline in Melbourne since 2015, when they peaked at $4000. The yields for Airbnb properties factor in cleaning costs and the extra wear and tear from short-term rentals.
Along with comparably low yields compared to longer rentals (across the board, except for Melbourne’s CBD), the vast majority of short-term rentals were never fully occupied.
“Airbnb listings are only likely to be rented 50 per cent of the time that they are available, and it is considered to be more financially stable for a property owner to list a property on the long-term rental market, rather than on Airbnb,” the report states.
This view was shared by economists, who point out that impact the listing service has had on the rental market in cities was minimal.
“Research has also found Airbnb only pushed up rents by a small amount at a city level, but within city suburbs that are popular with tourists – think of places like Bondi, Manly, inner suburbs in Sydney, St Kilda, Prahran – the effect on rents will probably be larger,” Domain Group economist Trent Wiltshire said.
“Airbnb’s effect on rents also will probably be more significant in suburbs where it’s difficult to build more housing.”
The research appeared to show the platform was supplementing the hotel market, particularly in areas with poor coverage of traditional holiday alternatives.
“There tends not to be hotels at the right price point in those locations,” Mr Rawnsley said.