Airbnb decision to clamp down on London landlords may affect tourism

Airbnb decision to clamp down on London landlords may affect tourism
Beyond the obvious loss of revenue for Airbnb, there is a danger that by de-listing hosts who reach the 90-day cap it will cause a sudden supply shortage

According to new research by My Property Host, the decision to limit the time that London landlords can let out their homes could unwittingly hit the capital’s tourism sector – reducing the supply and raising the cost of guest accommodation in peak visitor season.

The study, by the Airbnb concierge service My Property Host, analysed data from the nearly 50,000 London properties let through Airbnb over the past two years.

In that time the number of properties listed on the homesharing site has grown dramatically (at an average of 136% a year), from barely 9,000 in January 2015 to 49,000 now – making London Airbnb’s second biggest market.

Yet guest bookings have risen rapidly along with supply, with both occupancy levels and average prices broadly tracking each other through seasonal peaks and troughs.

But this consistency is set to be overturned later this year as Airbnb forces thousands of landlords to take their properties off the site – and the resulting supply shock is likely to trigger a spike in prices.

The reason is Airbnb’s decision to enforce a law which prevents owners from letting out an entire property to short-term guests for more than 90 days a year without planning consent.

Roughly 25,000 – just over half – of the London properties currently listed on Airbnb are entire homes. Last year Airbnb revealed that nearly 5,000 of them had been let out for longer than the 90-day annual limit.


Airbnb’s rule came into force at the start of January, meaning the first landlords could hit the 90-day cap in April. But many more are likely to reach the limit – and be kicked off Airbnb – just as the peak summer tourist season begins.

Elena Lopez, My Property Host managing director,  comments: “Airbnb deserves praise for doing its bit to ensure London landlords don’t flout the law. But in forcing thousands of hosts to comply with the 90-day rule, it is also risking unintended consequences.

Beyond the obvious loss of revenue for Airbnb, there is a danger that by de-listing hosts who reach the 90-day cap it will cause a sudden supply shortage.

While it’s likely that some unscrupulous landlords will seek to let their property for longer through Airbnb’s rivals, their share of the market is small by comparison. In previous years, consistent rises in both demand and supply of properties have kept Airbnb prices relatively stable, but 2017’s supply shock could hit hard and significantly drive up prices.

While the weak Pound has made London more attractive to foreign visitors, a sudden shortage of guest accommodation on Airbnb risks making the capital lose its tourist edge at just the wrong time.”

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Tom Allen
Tom Allen 20 Sep 2017

Absolutely agree with you!

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RyanGeo
RyanGeo 18 Sep 2017

A sharp correction would be a less dramatic expression to use. That is already underway in certain sectors in Reading where I practice as Chartered Surveyor

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sean benton
sean benton 01 Sep 2017

Identity theft is a thread for any profession. So,people should stay alarmed. I once take help from a letting agent and came to know that letting agents are taking every precaution to prevent fraudulent...

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Mark N.
Mark N. 30 Aug 2017

We have seen a surge in instructions over August and that should continue into September too.

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Chris
Chris 30 Aug 2017

Unfortunately, all the legislation bears its force on Landlords and ignores, naively, the effect of Rogue Tenants on the ability of landlords to keep houses in repair and offer properties for rent at reasonable...

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Christian Donovan
Christian Donovan 18 Aug 2017

The write-down on house values, combined with the fall in the GBP saddled the fund?s property portfolio with a 1.4% loss in the second quarter. The shocking amount of $240 million.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

Interesting point of view.

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Samantha Goodman
Samantha Goodman 11 Aug 2017

It depends on the people, some older adults decide to make a long-distance move in order to live closer to their children or settle in a place with a lower cost of living.

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brandonlee10
brandonlee10 24 Jul 2017

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IrisJ.
IrisJ. 19 Jul 2017

Great advice, but may I also add that when buying an already built home, make sure you do all of the proper inspections. Most importantly pest inspection because people tend to get surprised when they

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IrisJ.
IrisJ. 17 Jul 2017

The third point is, in my opinion, the most important one. People have become too inconsiderate and careless when it comes to rented properties. If a landlord wants to protect their property, regular visits...

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cornishalan
cornishalan 10 Jul 2017

Added to the cost of purchasing these village properties are the above average maintenance costs. Particularly where the property is a listed building or requires specialist building skills such as thatching...

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