Last Updated on September 13, 2023
Introduction
The economic benefits of Airbnb are hotly debated. Some argue that Airbnbs hurt hotels and the hospitality industry. Others say that taxes on hotels are higher than those on rentals, therefore shifting to Airbnb will only amount to a tax break for visitors. Still, others claim that short-term rentals could hurt local businesses by drawing away tourists and other potential customers who would otherwise spend money on dining out, shopping locally, or renting cars while they’re in town. How much a city benefits financially depends on multiple factors—including whether visitors would otherwise stay in hotels or decide not to travel at all; what they spend their money on while they’re there. Also, whether they use public transportation or drive, amongst other details. There is therefore no clear answer to how much overall revenue will increase if Airbnbs becomes more popular in urban areas like New York City or San Francisco. In these cities, people have been forced out of their homes due to rising rents, and gentrification has resulted from high rates of tourism.
Airbnb is a way of renting part or all of your home to travelers
Firstly, Airbnb is a company that connects people who need somewhere to stay with people who have somewhere for them to stay. Airbnb hosts rent out their homes, apartments, or rooms to temporary guests for as little as one night at a time—or for an entire month.
Moreover, Airbnb is also an option if you’d like to earn some extra money by hosting travelers in your spare room, apartment, or home. Getting help from online support can benefit you manage your success.
Airbnbs: What defines a short-term rental?
A short-term rental is defined as anything less than 30 days, with the majority of stays being one week or less. That said, the term can differ depending on location. In some places, a short-term lease can be three months, and in other places, up to six months.
A brief history of Airbnb
The company was founded in 2008 by two roommates who were struggling to pay their rent. Initially, the two offered just three air mattresses on the floor of their living room. By some estimates, Airbnb now has over 2 million listings worldwide.
Impact of Airbnbs
In some places, such as New York City and San Francisco, Airbnb has been blamed for rising housing costs and a worsening housing affordability crisis. These cities have seen the home-sharing service as one of the reasons for it being so difficult for low-income residents to find affordable housing options. However, there are other cities around the world that have seen Airbnb as a net benefit. In fact, in 2018 alone, it was estimated that 19 million people used Airbnb to travel—and that’s just one company!
Some argue that Airbnb hurts hotels and the hospitality industry. Others say that taxes on hotels are higher than those on rentals, so shifting to Airbnb will only amount to a tax break for visitors. Yet others believe the existence of the company does not affect either one in any significant way.
The truth is likely somewhere in the middle: Some hotels will lose business to Airbnb, but many more will profit from its existence. As with most things, your experience may vary depending on where you live, how much time you spend traveling on vacation, what kind of traveler you are (independent vs. organized), and whether or not you’re willing to pay for a hotel room at an affordable price. Cheaper hotel rooms can be sourced through a service like Expedia or Orbitz.
To add another layer of complexity into this discussion (which we’ve tried our best here not to do), some people argue that taxes on hotels are higher than those on rentals; therefore, shifting toward Airbnb would only amount to tax breaks for travelers while hurting local economies everywhere else.
Can a city benefit?
How much a city benefits financially depends on multiple factors. These can include whether visitors would otherwise stay in hotels or decide not to travel at all. Also, what they spend their money on while they’re there. Plus, whether they use public transportation or drive hired cars, and so on. There is no clear answer to how much overall revenue will increase.
How much can I make from Airbnb?
One of the most common questions our clients ask is “How much can I make from Airbnbs?” The answer depends on many factors, including:
- Type of property you own or rent
- The price point for your listing(s)
- Your ability to manage and maintain multiple listings
Conclusion
Airbnb is a popular way for people to earn some extra money and for travelers to find short-term accommodation. However, many critics say that the service hurts the hotel industry by taking business away from it, which could lead to higher prices and fewer jobs in these communities. Meanwhile, others argue that Airbnb supports local businesses by helping them generate more revenue through tourism spending—and that cities should encourage this growth rather than try to regulate it out of existence.
