Airbnb causes rents in New York to rise

Because of the popularity of Airbnb, the price of rent in New York have increased. The recorded increase rate was at 35 percent in some areas of the city.

Despite city legislation which made Airbnb rentals illegal in many cases, the number of Airbnb rentals continued to increase across the city. In 2010, there were 1,000 recorded Airbnb rentals in New York. It surged to 43,000 in 2015. However, the number decreased to 40,000 in 2016.

“For years, New Yorkers have felt the burden of rents that go nowhere but up, and Airbnb is the reason why.” Scott Stringer of the New York Comptroller said.

As the share of units listed on Airbnb goes up a percent, rental rates in neighborhoods go up by 1.58 percent. Overall, 9.2 percent of rent increases from 2009 to 2016 was because of the continued appearance of Airbnb rental units. These resulted in more than a total of $616 million alone that New York residents end up paying in the form of rent increases.

In computing the growth in rent prices, the study used eight years of data from 55 neighborhoods. The areas listed to be most affected by rent increase were Manhattan’s Chelsea and Brooklyn’s Greenpoint and Williamsburg. In those areas, Airbnb rentals accounted for more than 4 percent of the total residential units.

The rent in Chelsea increased by 21.6 percent or $398 per month between 2009 and 2016. Meanwhile, in Greenpoint and Williamsburg, the rent went up by 18.6 percent or $659 per month. However, Chris Lehane, the head of policy at Airbnb said that the “so-called report on Airbnb is wrong on the facts and the conclusions.”

A spokesperson for AirDNA, the company which collects information regarding Airbnb listings, said that the New York Comptroller did not contact the company about the study and misinterpreted the figures appearing on AirDNA. However, the Comptroller contended that they released a public statement requesting Airbnb to post their data regarding listings in New York.

In the aftermath of the study, Airbnb filed a Freedom of Information pleading with the New York City’s comptroller office. The appeal hopes to acquire updates regarding the development of the report.

Airbnb’s Chief Executive Brian Chesky said he seemed to be changing his approach to responsibility for how the company can impact housing markets and neighborhoods. He added that when Airbnb started ten years ago, it was the kind of culture that “you can’t take responsibility for what happens on your platform.” Because of this, the company has changed their point of view.