Do Short-Term Rental Platforms Affect Housing Markets? Evidence From Airbnb in Barcelona

IEB Working Paper N. 2019/05

37 Pages Posted: 1 Aug 2019

See all articles by Miquel-Àngel Garcia-López

Miquel-Àngel Garcia-López

Autonomous University of Barcelona; University of Barcelona - Institut d'Economia de Barcelona (IEB)

Jordi Jofre-Monseny

University of Barcelona - Department of Political Economics

Rodrigo Martínez Mazza

University of Barcelona

Mariona Segú

Université Paris Sud - Le Kremlin-Bicêtre

Date Written: July 29, 2019

Abstract

In this paper, we assess the impact of the arrival and expansion of Airbnb on housing rents and prices in the city of Barcelona. Examining highly detailed data on rents and both transaction and posted prices, we use several econometric approaches that exploit the exact timing and geography of Airbnb activity in the city. These include i) panel fixed-effects models with neighborhood-specific time trends, ii) an instrumental variable shift-share approach in which tourist amenities predict where Airbnb listings will locate and Google searches predict when listings appear, and iii) event-study designs. For the average neighborhood in terms of Airbnb activity, our preferred results imply that rents have increased by 1.9%, while transaction (posted) prices have increased by 5.3% (3.7%). The estimated impact in neighborhoods with high Airbnb activity is substantial. For neighborhoods in the top decile of Airbnb activity distribution, rents are estimated to have increased by 7%, while increases in transaction (posted) prices are estimated at 19% (14%).

Keywords: housing markets, short-term rentals, Airbnb

JEL Classification: R10, R20, R31, Z30

Suggested Citation

Garcia-López, Miquel-Àngel and Jofre-Monseny, Jordi and Martínez Mazza, Rodrigo and Segú, Mariona, Do Short-Term Rental Platforms Affect Housing Markets? Evidence From Airbnb in Barcelona (July 29, 2019). IEB Working Paper N. 2019/05. Available at SSRN: https://ssrn.com/abstract=3428237 or http://dx.doi.org/10.2139/ssrn.3428237

Miquel-Àngel Garcia-López (Contact Author)

Autonomous University of Barcelona ( email )

Plaça Cívica
Cerdañola del Valles
Barcelona, Barcelona 08193
Spain

University of Barcelona - Institut d'Economia de Barcelona (IEB) ( email )

Barcelona

Jordi Jofre-Monseny

University of Barcelona - Department of Political Economics ( email )

Av. Diagonal, 690
Barcelona, 08034
Spain

Rodrigo Martínez Mazza

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

Mariona Segú

Université Paris Sud - Le Kremlin-Bicêtre ( email )

Le Kremlin-Bicêtre
France

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