08-23-2020, 02:53 AM
(08-23-2020, 01:13 AM)plam Wrote:(08-23-2020, 12:48 AM)taylortbb Wrote: I'm not convinced Airbnb eliminates nearly as many units as people believe. If Airbnb didn't exist, many of those investors wouldn't purchase the property in the first place, and without buyers many of the properties that were developed as condos would instead be developed as hotels.
The pandemic was one data point: one could have counted how many airbnbs suddenly went onto the rental market. We certainly looked at places in Wellington, NZ which did a quick switchover. Comparing overall rents is kind of tricky, though, because there are a lot of confounding factors (like a global pandemic).
I'm not sure I get your point.
The pandemic destroyed the short term rental market, and for Airbnbs that meant investors tried to make them in to long term rentals. But I don't think that changes my point that if Airbnb was illegal, capital would be reallocated and we'd build more hotels and fewer condos. The hotels would just face pandemic bankruptcy (or bailouts) rather than conversion in to long term rental.
If we eliminated all the Airbnbs in Toronto, people wouldn't stop visiting Toronto. They'd just stay in hotels, which we'd now need more of. Land values wouldn't drop, and while the short term effect would be an increased supply of rental units (likely reducing price growth), the long term effect would be fewer condos built, constraining rental supply, and putting us back in the same scenario.