A recent study by business consultancy EY has revealed that Airbnb has a minimal effect on housing prices and availability in the UK. The research indicates that over 95% of the recent increases in house prices are attributable to factors unrelated to short-term rentals, such as rising incomes and inflation. This suggests that the impact of platforms like Airbnb on the broader housing market is limited.
Airbnb has pointed out that the UK has been struggling with a significant housing supply issue for years. According to independent estimates, there is a shortfall of approximately 5 million homes needed to meet current demand. The platform highlights that this shortage is a major factor contributing to high housing costs, rather than the presence of short-term rentals.
Furthermore, data from Airbnb shows that the majority of UK hosts list only one property on the platform. About 40% of these hosts indicate that the additional income they earn from renting out their space helps them cover their housing costs. This suggests that for many individuals, short-term rentals provide crucial financial support rather than driving up housing prices or reducing availability.
The EY study, commissioned by Airbnb, is the first to examine the economic impact of travel on Airbnb and its effects on housing affordability at various levels, including national, regional, and local. The report combines a quantitative analysis of Airbnb data with information from publicly available sources.
The study highlights significant economic benefits from Airbnb travel in the UK:
- In 2023, Airbnb travel generated £5.7 billion in gross value added (GVA) and supported over 75,000 jobs across the country.
- This translates to approximately £200 per year (or £17 per month) per UK household.
- London saw the highest GVA impact at £1.5 billion, followed by the South West (£855 million), Scotland (£774 million), and Wales (£354 million).
The report also notes that entire homes listed on Airbnb represent less than 0.7% of the total number of dwellings in the UK. On average, Airbnb hosts rent their homes for fewer than three days per month, suggesting that most hosts live in the properties they list.
Entire home listings on Airbnb that are rented for 90 nights or more per year make up only 0.17% of the UK’s housing stock.
The study finds that about 95% of the changes in rents and house prices from 2015 to 2022 are due to factors other than the growth of short-term rentals. Any observed correlation between Airbnb availability and housing costs is limited to a few specific areas, with most regions showing no such relationship.
The economic benefits, or GVA impact, of Airbnb outweigh any effects on housing in every country, region, and local authority. Even in areas where there is a link between Airbnb availability and housing affordability, the overall impact on affordability is minimal, with most of the UK showing no significant correlation between the increase in Airbnb listings and housing affordability.
The economic benefits of Airbnb outweigh its impact on housing costs across all nations, regions, and local authorities examined in the report.
Airbnb-linked travel provides an economic benefit of approximately £17 per month per household, which is double the potential impact on housing affordability, estimated at £8 per month per household, related to the increase in Airbnb listings.
The report’s modelling indicates that Airbnb growth is linked to improved rental and housing affordability in places like York and enhanced rental affordability in Wales. This improvement might be due to Airbnb increasing local incomes and promoting more efficient use of housing resources.
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