Airbnb: Global Phenomenon, Local Conversation A study of the environmental, economic, and social impacts of Airbnb on the Monteverde area by Mount Holyoke and Goucher Program Spring 2018
Why Are We Studying Airbnb? & Travel and employment are becoming increasingly individualized and independent. & The local impacts have been largely unstudied. & Discussing how Airbnb has affected the community is essential to diligent business and citizenry.
Socioeconomic Impacts Economic Impacts Presentation Overview Background of Airbnb Methods Global & Local Connections Environmental Impacts Review & Conclusion Q&A Session
Key Concepts & Globalization Working without regard to international borders at a global level, specifically for financial profiteering & Gig Economy Stems from the Â€sharing economyÂ or Â€peer economyÂ Short term informal relationships; evades regulations on health, safety, etc.; evades taxation and social expenditures & Greenwashing Promoting the perception that a company or establishment is environmentally friendly. & Gentrification Renovation to a house/district in order to appeal to more middle class clientele, often pricing out the original inhabitants
Airbnb Origins & Online platform where individual homeowners list their properties for short term Â€rent.Â & Started in 2007 by two roommates. & Customers can search online catalogue according to location and accommodations. & Today worth over $25 billion USD / 14.1 trillÂ‚n CRC.
Airbnb Model & As a simple to use internet based Â€platform,Â the Airbnb interface allows direct contact of owners and renters. & The network of contacts grows exponentially over time. & AirbnbÂƒs rating system is a Â€trust mechanism.Â & Superhosts are hosts who qualify via ratings and a perfect non cancellation record. They can charge more and are prioritized in the advertisement platform. & Evidenced effort to poach or hack othersÂƒ networks, specifically Craigslist.
Research and AirDNA & Survey of research on Airbnb, its operations, its effects on communities, and on efforts to regulate it & Market information from AirDNA is targeted towards hosts & investors who want to improve their business & Sample taken from Airbnb Monteverde area Â„ Statistical analysis Â„ Observations
Interview Methods Type of Person Sample Type Number Contacted Responses Received Airbnb Hosts Random 60 5 Hotel & Hostel Owners Convenience 35 4 Municipal Officials Convenience 3 2 Community Members Convenience 3 3
Global & Local Impacts and Responses
Hosts Breakdown & One study within the USA stated 40% of Airbnb hosts owned multiple properties in 2016. & In Hong Kong, more than 60% of Airbnb owners rent out more than one property. Across various studies, Airbnb owners own multiple properties.
Airbnb and the US Housing Market A University of California study published April 1, 2018 found that, within the top 100 Airbnb markets in the United States, a 10% increase in the number of Airbnb listings resulted in: & 0.39% increase in housing rent prices & 0.64% increase in housing ownership prices & Decrease in vacant homes and home availability for rent and sale Airbnb, however, disputes these findings with a study of their own which claims that 95% of economists donÂƒt believe the presence of Airbnb affects housing prices. 1 1 1
Slide 14 1 pt 1: wat. clarify. is this rent for airbnb or just normal houses? everywhere in the US or just where airbnb is present? and the housing I have the same questions. Is this prices to buy the houses? ALSO w the pt 1: how do we know this is related to airbnb, or is it just part of the natural market cycles? Dannye Carpenter, 07/04/2018 1 95% statistic-why are we saying it? worth saying that Airbnb made this and emphasize that point. sketchy statistic, point is not obvious Kallie Blakelock, 06/04/2018 1 To danny. I clarified, is it better? and to kallie, the point was to offer the opposing view bc it can be argued both ways James Williams, 07/04/2018
Texas Case Study & Claims that introduction of Airbnb lowered hotel revenue 8 10% from 2008 2014. & Biggest impact on locations that do not cater to business travellers: Â„ Budget hotels Â„ Hotels without convention centers Â„ Independent hotels & Opened market in places not zoned for hotels.
Costa Rica Case Study & It is speculated that Airbnb affects occupancy in hotels. & In 2017, expected hotel occupancy dropped 16% April to May 66.67% to 51%. & Costa RicaÂƒs Chamber of Hotels claims that this is caused by Airbnb.
Economic Takeaways from Case Studies & Hotels are competitors, especially in the budget market. & Housing market: Â„ Short term rentals are more profitable for owner. Â„ Fewer long term, more short term rentals available. Does Monteverde follow these global trends?
Evolution in Latin America & 250,000 properties listed in the region. & Bookings in Latin America increased by 148% in 2017. & Arrived in Costa Rica in 2011. & In 2016, 8,900 properties were listed in Costa Rica. & Costa Rica is the biggest market within Central America. Latin America is a large scale market opportunity for Airbnb Â€ and itÂs relatively new.
Monteverde Specifics Cumulative Number of Airbnb Properties / NÂ…mero Acumulativo de Propiedades en Airbnb
Attempts to Restrict Airbnb Lawsuits: & Barcelona, Spain fined Airbnb $600,000 / Â†340 347 000 for advertising unlicensed vacation homes. Â€We donÂƒt want a city for only tourists.Â Â‡ Barcelona Mayor Colau
Attempts to Restrict Airbnb & Stay Limitations Â„ Paris, France and New Orleans, Louisiana, USA both limit how long guests can stay. & Host Limitations Â„ Seattle, Washington, USA hosts may have only two rental properties.
Example of Gig Economy Resistance & Alternatives: Taxi drivers in Austin, Texas, USA Â„ City passes laws to hold Uber and Lyft drivers to the same standards as taxi drivers. Â„ Create alternative coop.
The Ecotourism Culture of Monteverde & Costa Rica has been one of the most successful countries in selling itself as an Â€ecotourismÂ destination. & 72% of Airbnb guests report that the environmental benefits of home sharing influenced their choice of travel platform. & Airbnb attracts eco aware tourists who are more likely to engage in local ecotourism and take notice of local environmental initiatives.
Water in the Cloud Forest & Monteverde hotels water conservation efforts: Â„ Placing signs in rooms Â„ Repairing leaks Â„ Using biodegradable soaps & Monteverde residents observe that water pressure and availability drops as tourist season peaks.
Can It Be Greener? & Hotels are more proactive in their environmental efforts when in a program such as the Certification for Sustainable Tourism CST. & Allowing for registered Airbnb properties to hold such a certificate has the potential to further increase the standard of sustainability in the Airbnb community.
Airbnb Efforts to be Green in Monteverde The most common responses from Airbnb owners about their efforts to be green include: & Natural lighting & Recycling & Tourists are eco minded
CST and Hotel Efforts to be Green in Costa Rica Pros & Encourages sustainable practices & Attempts to prevent greenwashing Cons & Expensive & Time consuming process & Guests do not often ask about certification & Airbnbs cannot be certified & 2/4 hotels interviewed were CST certified
Pricing & Hosts set their own prices. & Properties charge differing rates due to the type of housing. & Anyone can set up an Airbnb. General structure for pricing: & 3% service fee & 6 12% paid for guest service fees & 20% fee for Â€Airbnb ExperiencesÂ & Some pay a sales tax for international tax laws
Airbnb Host Income & Average revenue in Monteverde is $1,137 / Â†6 484 890 per year. & Income ranges greatly in Monteverde: $200 $10,000/ Â†114 000 Â†5 700 000 per year. & Average price of an Airbnb in Monteverde is $84 / Â† 47 880 per night.
Community Member Reaction Â€Este fenÂ‚meno es como una moneda que tiene dos caras; para los dueÂˆos que rentan es muy bueno porque reciben mÂ‰s dinero con el mismo bien inmueble, pero para las personas que alquilamos es una pesadilla.Â Â‡ Miembro de la comunidad Â€This phenomenon is like a coin that has two sides; for the owners who rent out their homes it is very good because they receive more money with the same real estate, but for the people that rent it is a nightmare.Â Â‡ Community Member
Taxes & The Costa Rican government is attempting to tax Airbnbs with guests that stay longer than a month. & Airbnbs are required to pay residential taxes but not hospitality taxes. Laws have and are being passed to equalize the tax burden, but are rarely enforced. Â€Los hoteles no le gustan porque ellos [dueÂˆos de los Airbnbs] no tienen que pagar impuestos de nada. Y no pueden competir con los precios de Airbnb.Â Municipalidad ÂŠ The hotels do not like them [Airbnb owners] because they do not have to pay taxes to anyone. And the hotels cannot compete with the prices of Airbnb. ÂŠ Municipality
Average Daily Rate / Promedio Tasas Diaras Daily Price / Precio Diario Number of Booked Properties / NÂ€mero de Propiedades Reservadas Price Fluctuations of Airbnb in Monteverde Entire Home / Casa Entera $83/day Â†47 000/dÂ‹a Private Room / HabitaciÂ‚n Privada $40/day Â†23 000/dÂ‹a Shared Room / Cuarto compartido $15/day Â†8 500/dÂ‹a
Seasonal Airbnb Occupancy Rate In Monteverde 30 40% difference between peak season Dec Apr and off season Sep Nov. Occupancy Rates / Tasas de OcupaciÂ€n
Revenue 2017 Monteverde area cumulative revenue / 2017 Ingresos acumulativo de Monteverde Â†970 273 339 $1,697,978 Revenue for Airbnb / Ingresos para Airbnb : Â†130 036 633 $227,564 3% taken from hosts for facilitation / 3% tomo de huestes por facilitaciÂ‚n 5 15% charged to guests for fees / 5 15% tomo de convidados por honorarios
Monteverde and the Sharing Economy & Monteverde has long participated in the sharing economy via the tradition of homestays for students. & People with homes provide short term accommodations for researchers. & The Airbnb hosts who are renting out part of their homes comprising 51% of the rental market in the area could be considered a new type of homestay hosts.
Types of Airbnb Hosts in Monteverde
Type of Airbnb Host and Listing Prices In Monteverde
Airbnb Rental Types in Monteverde
Listing Revenue in Monteverde Entire Home / Casa Entera Â†2 780 000 Â†16 865 000 $4,920 $29,851 Private Room / HabitaciÂ‚n Privada Â†1 060 000 Â†9 825 000 $1,876 $17,390 Shared Room / Cuarto Compartido Â†346 000 Â†717 000 $612 $1,269 Yearly Revenue per Listing Ingresos anualmente por propiedad Monthly Market Revenue / Ingresos Mensuales de RegiÂ‚n Entire Home / Casa Entera Private Room / HabitaciÂ‚n Privada Shared Room / Cuarto Compartido
Comparison of Amenities in Monteverde
Community Member Reaction Â€Creo que el modelo serÂ‹a bueno si tuviera regulaciones y restricciones y se pudiera regular segÂ…n las leyes de cada paÂ‹s. Igual que Uber.Â Â‡ Miembro de la Comunidad Â€I think the model would be good if it had regulations and restrictions and could be regulated according to the laws of each country. Same as Uber.Â Â‡ Community Member
Economic Impact on the Community & More of the community can participate in the tourism economy. & 4/5 Airbnb owners recommend local attractions and often receive commission. & Double listing: 70% of one hotelÂƒs bookings come through Airbnb.
Hotel Responses to Airbnb & 2/4 hotels interviewed felt impacted by Airbnb, must lower prices to remain competitive & 3/4 of hotels interviewed emphasized restaurants lose business as people prefer to cook at home with Airbnb & 3/4 of hotels felt that Airbnbs were lying to government for tax purposes & 4/4 of hotels stated Airbnb has contributed to lack of affordable housing in Monteverde
Airbnb Owner Responses Â€Creo que los Airbnbs los estÂ‰n afectando, ya que estÂ‰n creciendo sin regulaciÂ‚n.Â Â‡ AnfitriÂ‚n de Airbnb Â€I think the Airbnbs are affecting them as they are growing without regulationÂ. Â‡ Airbnb host Â€[Los hoteles] son para otro segmento de mercado que tienen mayor poder adquisitivo y prefieren ese producto.Â Â‡ AnfitriÂ‚n de Airbnb Â€[Hotels] are for a different segment of the market that has higher purchasing power and prefers that productÂ Â‡ Airbnb host
Government Responses Â€Tiene un problema de trabajo, turismo, seguridad, y convivencia.Â Â‡ Municipalidad Â€We have a problem of work, tourism, safety, and living togetherÂ Â‡ Municipality Â€No hay casas para alquilar, porque todas las casas estÂ‰n ocupadas por Airbnb. Ahora no puede alquilar por mes, es por dÂ‹a.Â Â‡ Oficial del Gobierno Â€There are no houses to rent because all of the houses are occupied by Airbnb. Now you cannot rent per month, itÂƒs per day.Â Â‡ Government Official
Review & Conclusion
Research Limitations & Discussion & Little research found that is focused on Monteverde. Â„ Low comprehensive data on hotels, housing market, environmental impacts, and on taxes. & Need to conduct further research in order to draw major conclusions about community impacts.
& Long term housing data & Hotel characteristics and data & Overall tourism numbers for Monteverde & Compare to eco tourist market & Statistical numbers nationally regionally, and locally & Impact on total tourism expenditures Recommendations for Further Research
Airbnb and Monteverde in the Future & Airbnb will not disappear; cities who have tried to ban it have just forced it to be more clandestine. & The growth of AirbnbÂƒs share of local markets is slowing and it will continue to slow in the central Monteverde area. & Some 80 of 390 properties in Monteverde no longer list with Airbnb, but we do not know if they will come back into the long term rental market.
Airbnb and Monteverde in the Future & Its growth is likely to move out to more peripheral locations. & If or when the road to Guacimal is paved, this will accelerate that process. & We know of no case in which Airbnb listings have declined without regulatory pressure, though both San Francisco and New York saw large declines with new regulations.
Greenwashing Issues & No ecological guidelines for Airbnb hosts or monitoring of their ecological footprints. & Could potentially create a certification related to CST. & This would allow eco consciousness to be a dimension of Airbnb competition for clients, and could improve AirbnbÂƒs ecological impact.
Gentrification Issues & Main effect is on the long term rental market. & There may be a seasonal element. & The problem may be made worse if Airbnb growth moves to peripheral areas. & Hotels also in many cases support the community, e.g. Community Foundation; Airbnb could organize to do the same.
Gig Economy Issues & Airbnb and the government signed an agreement on January 18, 2018 for Airbnb to collect the 13% sales tax on rentals, though this has not come into operation. & More regulation is expected in the future. & The CCSS is likely to begin monitoring compliance with contribution requirements for employees of Airbnb hosts.
Gig Economy Issues & Local authorities are likely to begin bringing Airbnb facilities into local compliance & Regulation could differentiate between hosts who have multiple listings and hosts who list a room in their private residence
Globalization Issues & Could Monteverde find a way to stop sending funds to make the wealthy Airbnb founders wealthier, and develop their own model? & Recall the Airbnb Model: Â„ a simple to use internet based platform that allows direct contact of owners and renters; Â„ A network of contacts that grows exponentially; Â„ A rating system that establishes trust and legitimacy & Airbnb got its first customers by poaching off of established networks such as Craigslist, a Monteverde specific model could do the same with the established network of Airbnb. & The interest in sustainable tourism is growing, and this community will need to address the resulting increase in tourism
Summary Some of the impacts of Airbnb in Monteverde include: & Increase in room availability & Disruption of traditional market & Effect of renter behaviour on neighbors & Concentration of ownership & Lack of environmental oversight & Variation in who is able to travel & Variation in who is able to own their own businesses & Direct profits to locals & Decrease in long term housing availability
Our Conclusion and Call for Discussion & Community impacts of Airbnb within Monteverde have been varied and significant. & The conclusion on whether Airbnb has been good or bad for the Monteverde community is not ours to make, but we hope to start a dialogue.
Questions? / ÂPreguntas?
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