The Future of Airbnb: Is It Still a Sustainable Choice?

Airbnb started as a sustainable and affordable answer to the rising waste and cost of the hotel industry. It was a way for people to rent out their spare rooms or their primary residences during times they weren’t there. Not only did it benefit the locals by giving them an additional source of income, but it let tourists book cheaper accommodation while experiencing the destination through an authentic lens. Another bonus was that it allowed families and larger travel groups to stay in the same place, unlike in hotels where multiple expensive rooms needed to be booked. Airbnb was the perfect solution for affordable, genuine travel.

Gone were the original ideas of Airbnb, its special platform turned into another way to book what was basically a hotel in terms of price and ownership except it came with a full kitchen instead of a minibar.

Once it became clear that Airbnb was becoming increasingly more successful, it wasn’t long until non-locals and even big corporations started to jump on the bandwagon. As a great investment opportunity, buyers began purchasing real estate in popular travel destinations, turning these investments into year round vacation rentals. Many locals who already owned multiple properties around their city also turned these into short term rentals to capitalize on the money brought in by tourists each month. Gone were the original ideas of Airbnb, its special platform turned into another way to book what was basically a hotel in terms of price and ownership except it came with a full kitchen instead of a minibar.

The taking advantage of Airbnb is what transformed it into something unsustainable. What began as a unique way for locals to rent out their extra room or empty primary residence turned out to have significant consequences for those living in these popular tourist destinations. The misuse of Airbnb’s original idea has made cities unlivable, unaffordable, and inauthentic. Looking at the effects of Airbnb on popular European countries and their destination hotspots highlights the devastating consequences for local citizens.

The Sustainability Behind the Original Airbnb

Airbnb’s original concept was sustainable at its core. Through its strong community focus, it encouraged tourists to live like a local, immersing themselves in authentic neighborhoods and meeting people from that destination. The concept meant that people from different cultures could meet each other by renting a room, encouraging connection and understanding.

Airbnb let tourists borrow homes when they were not being used. Since the rentals were usually primary residences, it meant that they were always in use, during the tourist season and during the off season. This also benefited the environment, with less waste, water, and energy being used in the specific destination.

Both locals and tourists could find flexibility on the platform…

It supported the economy by giving an extra stream of income to citizens of the destination. It allowed tourists to travel for cheaper while ensuring that they were directly supporting the local economy. Both locals and tourists could find flexibility on the platform, with locals putting their house for short term rent when their property was vacant and tourists finding accommodation that suited their specific needs.

Recently, Airbnb added features in an attempt to maximize its sustainability and find ways to equally spread the tourism flow. Airbnb is finding ways to highlight rural areas or less popular neighborhoods in cities to inspire tourists to stay there instead of the hotspots.

Guests can choose to be flexible rather than picking specific places and dates, and Airbnb will provide travel inspiration in lesser known areas.

Firstly, the company introduced flexible searching, which allows users to find places outside of the popular destinations. Guests can choose to be flexible rather than picking specific places and dates, and Airbnb will provide travel inspiration in lesser known areas. Secondly, they introduced a feature which allows guests to discover unique properties. This feature highlights places or properties with amazing designs, views, environments, and so on. Users can discover a plethora of unique and fun properties to stay at, usually in regions that do not have any tourist accommodation.

Airbnb upheld the sustainable values of economy, society, and environment. It was a platform that allowed tourists to benefit the local community, while caring for people and the planet. As it grew more popular, with larger investment opportunities for those outside the community, its concept became less beneficial and more damaging.

The Negative Effects of Airbnb

The impact of Airbnb on countries across Europe has made it clear that Airbnb has serious consequences for local communities living in these tourist hotspots. From facilitating overtourism, to reducing authenticity, to affecting quality of life, the negative effects of Airbnb are being felt by communities across the world.

Overtourism

Overtourism is becoming a major issue within Europe. This summer has highlighted the effects of tourism on local communities, with citizens taking action through protests across the continent. While overtourism is very much its own problem, Airbnb has certainly contributed to it, especially when it comes to local areas.

One of these effects is the lack of respect many tourists have when staying within these communities. Ignoring important rules and values, being loud and unaware of their surroundings, and simply forgetting that the property, its surroundings, and the people who live there are part of the mundane life of the destination. With more properties available in popular areas in tourist destinations, overcrowding of these places has made it impossible for locals to go about their normal lives.

Quality of life

In tandem with overtourism and the change of citizens’ everyday lives, are the negative effects on local communities’ quality of life. ETERON writes that “The Airbnb phenomenon affects a city’s space and everyday living conditions.” Gentrification or “touristification” as the new trend is called, is seeing once authentic, cultural areas turn into tourist hotspots.

This includes major changes in local areas with activities and services created for tourists This can seriously damage a community as they will face a lack of their genuine and unique local community. While the idea of living like a local is sustainable tourism at its best, and Airbnb, despite its issues, has continued to allow tourists to stay in local areas, it has turned these areas into places that cater to what tourists want rather than residents.

Housing shortages

Countries across Europe are in the middle of a housing crisis, and what has come out of many of the protests against Airbnb is the serious worry that residents have no place to live anymore. Due to the success of Airbnb, investors and companies have found it worthwhile to buy up a lot of the property in popular destinations, driving up real estate prices.

Not only has this led to many residents finding themselves out of a home, but it also makes it impossible to buy property. From the lack of actual property to buy or rent, to the increase in prices for both buying and renting, residents have no place to live. Those who do own secondary residences are choosing to rent short term instead of long term because they can often earn more profit from short term rentals.

Location

What were once vibrant spaces for local communities have become drained of their uniqueness. This is especially true for city centers in major tourist destinations, which are unattainable for residents to live in. The increase of Airbnbs in cities has had a direct impact on the lack of community many residents are feeling, for example, people no longer know their neighbors with the rise of short term rentals.

Business

As previously mentioned, gentrification has ensured that many resident-oriented services have been replaced by tourist-oriented services in local neighborhoods as more Airbnbs begin to operate. This has destroyed many locally owned businesses and stopped tourism from benefiting the local economy by buying within the community. Greek tour guide Onoufrios Dovletis, writes that, “Local businesses are closing, such as the shop of a person that repairs shoes or clothes, in favor of more restaurants and more cafes, all made to suit the 'multicultural' taste of tourists.” The uniqueness that local businesses bring to an area is disappearing, and touristification is taking over.

Pricing

Airbnb used to be a great alternative for tourists looking for flexibility, lower costs, or more authenticity, however this is no longer the case. Airbnbs in popular destinations are becoming increasingly more expensive and it no longer is an alternative to a hotel, but is competing with hotels at the exact same price.

Ownership
Airbnb gave power to locals in popular tourist destinations to have an additional source of income. It ensured that tourists would be funneling money back into the local community by renting from the locals themselves. The popularity of Airbnb, however, has driven the ownership of many listed properties into the hands of large corporations or big investors, with locals often priced out of buying any real estate.

Case Studies: A Look at European Regions Impacted by Airbnb

The negative effects of Airbnb have been felt especially severely across Europe this summer, with citizen protests bringing these effects to light. Like most of the world, Europe is in the midst of a housing crisis, a rise in cost of living, and overtourism, all factors which Airbnb has actively contributed to.

Greece & its Islands

This summer, residents of Rhodes, Greece were shocked to find it crawling with more tourists than ever before. From restaurants to popular attractions to its beaches, residents found themselves displaced. Cheryl Triantafilidis, a resident of the island said that “Things have changed massively in the past few years in Greece. I am shocked to find now that we must phone at least a day ahead to reserve a sunbed on most islands.”

She described trying to find a place at the beach as impossible, with herself and her family sitting anywhere they could find as people were packed onto the sand. “It has tripled in Rhodes everywhere,” she said. As overtourism continues to plague the Greek islands, their authenticity and what made them popular destinations in the first place is slowly being replaced with gentrified versions. Their unique culture and way of life is threatened by the rise of short term rentals and the amount of tourists crowding the islands.

In Athens, residents are actively being pushed out, with the number of Airbnbs increasing from 2,000 to 12,000…

Airbnb actively facilitates overtourism, providing more places for tourists and less places for residents. In Athens, residents are actively being pushed out, with the number of Airbnbs increasing from 2,000 to 12,000, and rent in the city increasing by 29.8% in two years. Eteron writes that “Airbnb is growing further and further away from functioning within a framework of a ‘sharing economy’.” Airbnb tourism is negatively affecting the local environment, economy, and community, contributing to a lack of essential resources for tourists.

Spain & Barcelona

This summer, protesters in Barcelona took matters into their own hands and shamed tourists by squirting water into their faces. Residents of Spain, and more specifically Barcelona, are facing extreme increases in housing prices and natural resources as a result of Airbnb and overtourism.

The rise in short term rentals on Airbnb has increased rents by 7% and housing prices by 17%

The rise in short term rentals on Airbnb has increased rents by 7% and housing prices by 17%. The difference in percentage of the number of properties owned by people who have tourist licenses is massive, with 38.4% of holders owning one property, and 61.6% owning 5 or more properties. EuroNews reported that tourist properties have risen by 9% in the last year. Now more than 340,000 properties are registered, with some cities having “one tourist rental for every 1.5 square kilometer and for every 139 locals.”

Ireland

In Ireland, Airbnb has been a large contributor to the housing crisis. Unlike many European countries, Ireland’s cities are a lot smaller, with many small towns also serving as popular tourist destinations. With not many places to stay in these smaller cities and towns, Airbnb has provided a way for tourists to stay in these areas, but this has also led to the displacement of residents as well as students looking to move to larger cities for university.

Specifically in smaller cities like Galway, where the university itself only offers 1 bed per 10 students, and many student accommodation building plans being stopped by residents complaining about noise and overcrowding, Airbnb has forced many to either defer their education or seek it elsewhere. The Guardian has reported that there are 14 times as many properties advertised on Airbnb than there are to rent long term, and the properties that are there to be rented have increased in rent to a point where many students and workers cannot afford to live in the major cities.

According to Airbnb, they have created 5,000 jobs in Ireland. While the creation of jobs is certainly an important factor in favor of the company, access to housing is just as important. Jobs are filled by workers and workers need places to live, if there are no places to live, then how should the workers fill the jobs? The Guardian points out another hypocritical situation, where many Irish Airbnb hosts have an Airbnb property as a way to afford the rising cost of living. If the only way these citizens can make ends meet is by having an additional property, then how is it justified to restrict this source of income, and at the same time, how is it justified to not turn these short term rentals into long term rentals? These situations point out the issues with owning and regulating Airbnb.

… there are 30,000 houses that are empty in Dublin, with landlords preferring to rent short term rather than long term because of the monetary incentive

The Irish Times has reported that there are currently 12,000 Airbnbs on the platform that could be used as long term rentals to house families. Moreover, the Guardian has written about how there are 30,000 houses that are empty in Dublin, with landlords preferring to rent short term rather than long term because of the monetary incentive. Compared to the 1,329 properties for long term rent in Dublin, there are 3,165 properties on Airbnb. This fact alone highlights the major issues of Airbnb on residential quality of life, and more specifically, the housing crisis.

The Next Steps

Over the summer residents of popular tourist destinations have joined together in protest against the rise of overtourism and the effects of Airbnb on everyday life. Governments have begun to crack down on Airbnb, imposing restrictions in an attempt to start safeguarding residents’ quality of life.

After the situation in Barcelona, the government has suspended the granting of new tourist licenses in the city. By 2028, Barcelona is planning to get rid of all short term rentals, releasing 10,000 apartments back into the long term rental market.

Moreover, Seville is declining to renew tourist licenses for the main tourist neighborhoods in its historic center and Malaga has banned the use of tourist apartments unless these apartments have access to a private entrance for tourist use. The suspension of short term rentals was also implemented by Portugal to protect its historic neighborhoods and solve the housing crisis.

The city has also seen a huge decrease of available Airbnbs from 12,000 to 5,000.

In both Germany and the Netherlands, the governments have introduced regulatory mechanisms like capping. Currently, residents of Amsterdam can only rent their residences out for a maximum of 30 days. The city has also seen a huge decrease of available Airbnbs from 12,000 to 5,000. The government also ensured that investors and corporations can only purchase property that is less than half a million EUR. In Berlin, the government has limited short term rentals to 90 days a year unless that residence is a primary residence. Each rental needs a registration number for Airbnb which will help the government monitor and enforce regulations easier.

Airbnb also partnered with the Fraunhofer Institute IAO to examine the landscape of German short term rentals. The Institute found that around Germany only 0.07% of Airbnbs were non-owner occupied and rented for more than 90 days, with this number reaching 0.15% in larger cities. In light of Germany’s tighter short term rental restrictions, the Institute also pointed out that Airbnb did not significantly change access to housing or the market’s prices. The Airbnb market in Germany is growing, however the market share of the number of short term rental providers continues to remain at 8%, which in Airbnb’s words, “is quite manageable.”

Ireland has created a stricter registration process where fines between 300-5,000 EUR will be given out for renters who do not adhere to the new rules. The Irish Times reported that the Irish government is also planning to create tighter restrictions through new legislation which will implement a “mandatory national digital registration scheme” for short term rental properties. Those looking to offer their property as a short term rental will need to obtain planning permission for any accommodation that is rented for 14 days at a time and for more than 90 days a year.

A Balancing Act: How Much Regulation Is Too Much?

Epler Wood found that tourist taxes often fund marketing for the country rather than towards helping local communities.

But are all of these actions really enough? The attempts to combat overtourism through additional regulations such as controlling Airbnb rentals and implementing tourist tax has not always worked in citizens’ or tourists’ favor. While Business Insider has reported that the Airbnb restrictions in major cities like Amsterdam and Lisbon have had a direct impact on decreasing or stable housing costs, many studies have also found issues with certain governmental regulations. Epler Wood found that tourist taxes often fund marketing for the country rather than towards helping local communities.

While regulations should combat overtourism, it should not make tourism impossible because with proper measures, tourism can be extremely beneficial to both the tourist and the resident alike.

Another study by STAMP has revealed that residents’ everyday lives have not been benefited by tourist tax or regulation, with no effect on utilities, housing, or other important resources. The Fraunhofer Institute IAO also found that Airbnb is used as an additional source of income to help with costs of living in Barcelona. The Institute highlighted how guests living in Airbnbs tended to spend money locally, both in the major tourist hotspots and surrounding neighborhoods. On the tourist side of things, a New York City study found that after banning Airbnb apartments, hotel prices increased to an average of 300 dollars per night. This makes tourism in some cities impossible, with travelers unable to afford these prices. While regulations should combat overtourism, it should not make tourism impossible because with proper measures, tourism can be extremely beneficial to both the tourist and the resident alike.

This research is an important look into the downside of extreme restrictions. Finding the right balance of regulation will ensure sustainable tourism that benefits both the destination and the tourist. Turning Airbnb back into its original purpose should be the main goal of both governments and the company itself. Airbnb’s contributions to the rise of housing issues, displacement of residents, and the change of residential centered neighborhoods to tourist centered neighborhoods can only be changed through direct government action.

Governments must be responsible for safeguarding local communities, businesses, and neighborhoods, while keeping their cities authentic and centered around their residents.

Some of the most important changes that need to be implemented are for owners to only be able to rent out their primary residence or, if they do own a secondary residence which they also actively use, then that can be rented out as well for a certain period of time. Moreover, it is essential that the government work on banning corporations and foreign investors from buying up local property and driving up housing costs. Governments must be responsible for safeguarding local communities, businesses, and neighborhoods, while keeping their cities authentic and centered around their residents.

A Sustainable Crossroads

The effects of Airbnb have been felt across Europe, especially this summer, with protests breaking out across the continent against the short term rental company. Airbnb’s initial foundation provided the tourism industry with a fresh way to travel which benefited the local economy, community, and environment. Unfortunately, with large corporations and outside investors taking advantage of the system, Airbnb has lost its sustainable benefits. In the current economic climate, turning Airbnb into a force for good will be a challenge, with the level of restriction needed to regulate the company being rather unfeasible.

It is only with strict and proper government regulations, that Airbnb can regain its status as a sustainable alternative. The governments of the Netherlands and Germany are already trying to turn Airbnb back into its original purpose.

Ultimately, it is up to our governments to start putting citizens and residents first to make Airbnb sustainable again.

By using the platform the way it was supposed to be used – connecting tourists with locals – then yes, Airbnb would be sustainable. Moreover, while the consequences of Airbnb have done significant damage to local communities, that does not mean Airbnb should be completely boycotted. Hosts that uphold the original idea of Airbnb should be supported by tourists looking for an alternative to hotels. Ultimately, it is up to our governments to start putting citizens and residents first to make Airbnb sustainable again.

SustainabilityQuinn DonovanOctober 28, 2024sustainable, sustainable travel, Sustainability, Airbnb, Accomodation, Hotels