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The recent Airbnb ban in New York City is unlikely to make a meaningful dent in solving the city's housing crisis, according to a deeper analysis of the data. While presented as a policy to return rental units to the long-term housing market and improve affordability, the impact of eliminating short-term Airbnb rentals will be significantly more limited than many expect.
New York City has over 300,000 vacant available housing units, a massive surplus inventory that has swollen in recent years, up from just 248,000 vacant units in 2017. In comparison, there are only around 47,000 active Airbnb listings across all five boroughs of NYC as of mid-2023, per the latest estimates. And this Airbnb number has already dropped 18% since 2017 due to previous restrictions.
Delving further into the types of Airbnb listings in New York City, the data reveals that only a small fraction are frequently rented, full-time short-term rentals. Approximately 23,000 of the 47,000 total listings are consistently active on Airbnb month-to-month. The other 24,000 listings are rented more sporadically, many functioning essentially as long-term rentals or mid-term corporate and temporary housing rentals of a month or longer.
Additionally, 19,000 of the active Airbnb listings are private or shared rooms, where the host lives on-site and rents out a spare bedroom or basement. These types of units were already exempt from short-term rental laws. This leaves just around 4,000 listings across New York City that are full-time short-term rentals of an entire apartment or home.
Even in the unlikely scenario that all 4,000 of these full-time investment properties were repurposed into long-term housing stock available for lease, it would barely make a dent in the city's housing inventory and do little to improve affordability. With over 300,000 vacant units already sitting empty, an extra 4,000 units is a drop in the bucket.
Meanwhile, eliminating short-term rental options like Airbnb poses other potential economic risks. With fewer accommodation alternatives, hotel and lodging prices in New York City will likely soar to capture increased demand, especially during major events and peak travel seasons. This could make visiting New York City extremely expensive and cost-prohibitive for many average families without substantial travel budgets.
Lower middle-class tourism and family travel to New York City could drop significantly if lodging rates rise without Airbnb availability as a budget-friendly alternative to hotels. This reduction in affordable tourism and travel would negatively impact the many small businesses across the city that rely heavily on visitor foot traffic and tourist spending to stay afloat.
While masquerading as a solution to combat unaffordability, the data indicates New York's Airbnb ban will fall far short of making housing more accessible to middle and low-income residents. The negligible impact on inventory, coupled with potential economic drawbacks of reduced affordable tourism, illustrates why this policy misses the mark.
There are simply too many other complex factors at play driving New York City's housing crisis for such a narrow ban to move the needle in a meaningful way. Zoning regulations that severely restrict new housing development, inflation driving up construction costs, lack of public housing funding, and outdated rent controls all contribute to the supply-demand imbalance that has made affordable housing scarce.
Rather than scapegoating short-term rentals, evidence shows more effective solutions for affordability will require a holistic approach. Easing zoning density restrictions near transit hubs, providing tax incentives for affordable development projects, allocating more funding for discounted public housing, updating antiquated rent stabilization measures, and expanding tenant eviction protections will all be impactful steps.
The data makes it clear that the Airbnb ban fundamentally misses the root causes behind New York City's deeply entrenched housing crisis. While a politically expedient measure, its negligible impact on inventory and potential harms to small businesses and affordable tourism demonstrate that more thoughtful, comprehensive policies are needed to create meaningful change on housing accessibility and affordability. Only by peeling back the onion on all contributing factors can realistic solutions emerge.