I was fully expecting this to by a study "by Airbnb" and I wasn't disappointed:
"On behalf of Airbnb, an online service for short-term vacation rentals, HR&A conducted an economic impact assessment of Airbnb rental activities in the City of San Francisco, and is currently conducting a follow-up study of its impacts on New York City."
Yep. I actually think it would be valuable to have a third-party non-profit entity that provides economic impact assessments of start-ups like Uber and Airbnb, so we are backing up our regulatory policy changes on data rather than emotion or lobbying.
non-profit do you mean university? I'd rather have university do the research.
I often think non-profit is not as independent as we think. After all, a lot of non-profit are to advocate against public policy. Whereas usually university research (from multiple sources) seem to be more independent.
I agree that non-profits can and often are not independent of private influences. Universities can fall under the same influences as well, such as MIT's concrete research studies being funded and advocated by the Portland Concrete Association.
In this situation, I would have liked to see an independent non-profit or University group that was funded 50/50 by New York City and Airbnb to do the study. Perhaps you can argue that the funding arrangement is not perfect, but it's definitely a step in the right direction.
Bunch of garbage. Enabling tourists to stay in different neighborhoods doesn't grow the economy, it just shifts where some of the money is spent from midtown to downtown.
Actually, I stayed in an AirBnB room for something like $20 a night in east Williamsburg while looking for a long-term apartment. It was cheaper than staying with a friend in White Plains and commuting on Metro-North every day. Not tourism $$, but darned useful to people moving to a new city.
Without access to the report it seems that any discussion is difficult. I think the only thing you can say is that OP is "ignoring the fact that metro.us reported HR&A's claims to have made the following findings:"
This is not an independent, peer-reviewed study. It was commissioned by AirBnB. HR&A, the study's authors, point the interested to AirBnB's press release versus a full paper [1].
One would be cautioned against taking its findings seriously. I am even intrigued as to why AirBnB felt it was unnecessary or even counterproductive to release the full paper.
The paper may be commissioned by Airbnb, but I think the fundamental findings are pretty solid. Of course I'm probably fairly biased because I'm a pretty heavy Airbnb user, with more than ten Airbnb stays in NYC in the last couple years.
From what I've experienced Airbnb has allowed me to stay in areas of the city that have few hotels or poor hotel coverage. I'm not the kind of person who enjoys Midtown. I can't stand the tourist crowds, most of the restaurants are horrible and there is no way in hell that I'm going to spend $200 a night of startup money on staying at a Midtown hotel.
So when I'm in NYC with the startup I work for I'll stay in Williamsburg at a cheap Airbnb place. Because of this I'm usually able to stay around three weeks, and during that time my money is going to local restaurants, bars, and convenience stores in Williamsburg and the LES.
All considered I probably still spend the same amount of money as your average Midtown tourist, because I stay in NYC much longer even though my expenses per day are lower than if I was staying in corporate hotels. But the important thing is that the money I do spend is going to a local resident (90% of the Airbnbs I've stayed at have been renting a room in the primary residence of the Airbnb host), and to small local businesses, not to big corporate chain hotels and chain restaurants in Midtown. I consider this to be a good thing.
Don't worry. The next mayor, Bill de Blasio, will be certain to put an end to this sort of horrible monstrous abuse of the city, in the name of Affordable Housing and Tenants' Rights. :P
Anecdote for my sister in Texas:
2010: Started renting her house on AirBnB to build savings / side-income.
2011: Left full-time design job.
2012: Repaired house and added efficiency unit.
2013: Picking up freelance design work.
Results: She works less hours overall, but feels need to respond to AirBnB-related requests at all hours. Now has ~20% higher income but less predictability. She pays taxes. AirBnB taught her several skills necessary for entrepreneurship. Still cringes when there is a critical review.
Her local bars and cafes definitely benefit from her guests (she provides local recommendations). I suspect local hotels might be losing some but not all of the business. Her guests pay roughly 25% less than local hotels.
She also travels more now, and has built a network from people who have stayed with her. Examples: Helped plan a wedding, assisted commercial photo shoots, went for drinks when visiting former guests’ cities.
This is something I see often ... a company wants to prove some positive thing about their business, so they commission a study, only to have it torn down in comments because it was they who paid for it.
I totally get that it's a conflict of interest, but what alternative is there? Seems like a study of this kind is really valuable to be able to contribute to the policy conversation that's currently underway. Would the only ethical option be for AirBnB to put out a public call for someone, anyone, to do this study on their own dime? Who would do such a thing without being paid up front? Would it still be a conflict of interest if the researchers put up a crowdfunding campaign to pay for the study (even if they did so at the behest of AirBnB)?
I agree. Rather than arguing against the data in the study its easy to just use the strawman argument of "but it's paid for by Airbnb so it must be biased."
But I will say that I would like to see the actual original data in the study instead of just the numerous blog posts about the study. I did some internet searching and was unable to find the original study, just news articles about it. If we had the original study and we could see the data sources and actual data points then we could have a real discussion about whether or not the study is legitimate.
The problem is that the underlying "facts" are really misinterpretations.
> 62 percent of Airbnb hosts say Airbnb helped them stay in their homes
The statement seems to suggest that most people wouldn't be able to afford their homes if it weren't for airbnb, but I'm pretty sure that wasn't the question they posed. If you asked "would you be able to afford your home or apartment without airbnb?", then you'd see far less than 62%.
> Airbnb visitors stay on average 6.4 nights (compared to 3.9 for hotel guests) and spend $880 at NYC businesses (compared to $690 for average New York visitors).
The monies paid to rent a hotel room is money paid to a NYC business and is omitted from this count. If it were counted, using the average stay numbers people contribute more to the economy by staying at the hotel than with airbnb.
Another looming question is whether you should count new yorkers who use airbnb to stay in other places. this study doesn't consider that factor at all, and it's likely that the loss to the NYC economy due to those people exceeds the gain due to others coming into the city.
Can anyone comment on the difference between "contributions to total spending in the city economy" and "economic activity generated in the city"? I am curious about the disparity in these two statements:
SF: From April 2011 May 2012 guests and hosts utilizing Airbnb have contributed $56 million in total spending to San Francisco’s economy [1]
NYC: Over the course of a year, Airbnb generated $632 million in economic activity in New York. [2]
Another question I have is how would the authors identify the economic contributions of AirBnB hosts in San Francisco? And/or how they would distinguish between the contributions that were the result of AirBnB and those contributions that would have happened without AirBnB?
I am aware of HR&A's motivations.[3] I am not trying to criticize the report I am interested in the actual analytical process.
If you are staying for a day or two, you most likely would go out and eat your meals (including breakfast). For longer stays, especially with kitchen access, you probably would buy cereal, milk, juice, and other items. If you are estimating the cost of food based on average or median restaurant, you aren't capturing the true dynamics (note: as they said in the report, the average stay is close to a week in length)
As a New Yorker looking for an apartment I've really come to despise Airbnb. Housing has obviously always been expensive here, but it's reached new heights this year. I'm looking in Brooklyn and not only are the rents higher than I've ever seen them, but it's much more difficult than before to find a bedroom in an existing household (via craigslist, etc). All the while I encounter an increasing number of people, friends, acquaintances, friends of friends, who say they have a bedroom in their apartment that they keep open to rent out to Airbnb guests. I know this is HN and someone is going to say this is just an anecdote, and clearly that's true, but there's no doubt Airbnb is not just competing with hotels, it's also lowering housing availability in desirable neighborhoods, and likely raising prices in an already expensive rental market.
Dumping industrial waste into the Hudson, prostitution, and the drug trade are also boosts to the local economy. Think of all the jobs! However, they are are illegal in NYC, just like Airbnb, though the externalities are much worse in those cases. The point is that most laws restrict a bit of economic freedom for other societal benefits. Think of how much cheaper housing would be if only we ditched those pesky building codes!
I happen to work for a company that does economic impact assessments, and I'm skeptical of this "study", to say the least (it's hard to tell w/o a link to the full paper, only a press release). Basic unanswered issues:
(1) How do you show how many guests would not have come to NY at all if AirBnB didn't exist? This is called the counterfactual. (If they would have come anyway, then hotels lose the same amount of business, leading to no net gain.) And, if money is just being shuffled from midtown to the outer boroughs, how is that a net win for NYC? Broken window fallacy, anyone?
(2) I guess you could argue that NYC is better off if the same dollars are going to residents rather than corporate hotel chains (if you show higher multipliers, maybe some good externalities like supporting artists). But that's a very complex assessment in itself, likely way beyond the scope of this study. And you've got to count only net benefit versus the counterfactual.
(3) Sure, AirBnB guests might stay longer and spend more (what data is that based on? Don't many people use AirBnB because it's cheaper?), but that correlation doesn't mean that some magic AirBnB pixie dust caused them to do so. And is this offset by less money spent on the lodging itself compared to an hotel?
32 comments
[ 4.9 ms ] story [ 49.8 ms ] threadI am courious about how they calculated such precise numbers
"On behalf of Airbnb, an online service for short-term vacation rentals, HR&A conducted an economic impact assessment of Airbnb rental activities in the City of San Francisco, and is currently conducting a follow-up study of its impacts on New York City."
http://www.hraadvisors.com/featured/economic-impacts-of-airb...
I often think non-profit is not as independent as we think. After all, a lot of non-profit are to advocate against public policy. Whereas usually university research (from multiple sources) seem to be more independent.
In this situation, I would have liked to see an independent non-profit or University group that was funded 50/50 by New York City and Airbnb to do the study. Perhaps you can argue that the funding arrangement is not perfect, but it's definitely a step in the right direction.
I'd be especially interested in how the impact of established services changes over time.
Actually, I stayed in an AirBnB room for something like $20 a night in east Williamsburg while looking for a long-term apartment. It was cheaper than staying with a friend in White Plains and commuting on Metro-North every day. Not tourism $$, but darned useful to people moving to a new city.
- People stayed longer and spent more
- Money ended up in individuals' hands, instead of a hotel megacorp chain
- Much was outside Manhattan (a distinction from your claim of "midtown to downtown")
One would be cautioned against taking its findings seriously. I am even intrigued as to why AirBnB felt it was unnecessary or even counterproductive to release the full paper.
[1] https://twitter.com/hraadvisors/status/393039913307758592
From what I've experienced Airbnb has allowed me to stay in areas of the city that have few hotels or poor hotel coverage. I'm not the kind of person who enjoys Midtown. I can't stand the tourist crowds, most of the restaurants are horrible and there is no way in hell that I'm going to spend $200 a night of startup money on staying at a Midtown hotel.
So when I'm in NYC with the startup I work for I'll stay in Williamsburg at a cheap Airbnb place. Because of this I'm usually able to stay around three weeks, and during that time my money is going to local restaurants, bars, and convenience stores in Williamsburg and the LES.
All considered I probably still spend the same amount of money as your average Midtown tourist, because I stay in NYC much longer even though my expenses per day are lower than if I was staying in corporate hotels. But the important thing is that the money I do spend is going to a local resident (90% of the Airbnbs I've stayed at have been renting a room in the primary residence of the Airbnb host), and to small local businesses, not to big corporate chain hotels and chain restaurants in Midtown. I consider this to be a good thing.
Results: She works less hours overall, but feels need to respond to AirBnB-related requests at all hours. Now has ~20% higher income but less predictability. She pays taxes. AirBnB taught her several skills necessary for entrepreneurship. Still cringes when there is a critical review.
Her local bars and cafes definitely benefit from her guests (she provides local recommendations). I suspect local hotels might be losing some but not all of the business. Her guests pay roughly 25% less than local hotels.
She also travels more now, and has built a network from people who have stayed with her. Examples: Helped plan a wedding, assisted commercial photo shoots, went for drinks when visiting former guests’ cities.
I totally get that it's a conflict of interest, but what alternative is there? Seems like a study of this kind is really valuable to be able to contribute to the policy conversation that's currently underway. Would the only ethical option be for AirBnB to put out a public call for someone, anyone, to do this study on their own dime? Who would do such a thing without being paid up front? Would it still be a conflict of interest if the researchers put up a crowdfunding campaign to pay for the study (even if they did so at the behest of AirBnB)?
But I will say that I would like to see the actual original data in the study instead of just the numerous blog posts about the study. I did some internet searching and was unable to find the original study, just news articles about it. If we had the original study and we could see the data sources and actual data points then we could have a real discussion about whether or not the study is legitimate.
> 62 percent of Airbnb hosts say Airbnb helped them stay in their homes
The statement seems to suggest that most people wouldn't be able to afford their homes if it weren't for airbnb, but I'm pretty sure that wasn't the question they posed. If you asked "would you be able to afford your home or apartment without airbnb?", then you'd see far less than 62%.
> Airbnb visitors stay on average 6.4 nights (compared to 3.9 for hotel guests) and spend $880 at NYC businesses (compared to $690 for average New York visitors).
The monies paid to rent a hotel room is money paid to a NYC business and is omitted from this count. If it were counted, using the average stay numbers people contribute more to the economy by staying at the hotel than with airbnb.
Another looming question is whether you should count new yorkers who use airbnb to stay in other places. this study doesn't consider that factor at all, and it's likely that the loss to the NYC economy due to those people exceeds the gain due to others coming into the city.
SF: From April 2011 May 2012 guests and hosts utilizing Airbnb have contributed $56 million in total spending to San Francisco’s economy [1]
NYC: Over the course of a year, Airbnb generated $632 million in economic activity in New York. [2]
Another question I have is how would the authors identify the economic contributions of AirBnB hosts in San Francisco? And/or how they would distinguish between the contributions that were the result of AirBnB and those contributions that would have happened without AirBnB?
I am aware of HR&A's motivations.[3] I am not trying to criticize the report I am interested in the actual analytical process.
[1] http://assets.airbnb.com/press/press-releases/Economic_Impac...
[2] http://www.metro.us/newyork/news/2013/10/22/airbnb-a-huge-bo...
[3] http://www.paulgraham.com/submarine.html
I think the point boils down to:
1) dollars paid to hosts are counted towards the city economy (ostensibly most of those would be spent in the city) -- this is direct
2) renters need to eat etc, and those monies should be counted to the economic activity -- this is indirect
(1) How do you show how many guests would not have come to NY at all if AirBnB didn't exist? This is called the counterfactual. (If they would have come anyway, then hotels lose the same amount of business, leading to no net gain.) And, if money is just being shuffled from midtown to the outer boroughs, how is that a net win for NYC? Broken window fallacy, anyone?
(2) I guess you could argue that NYC is better off if the same dollars are going to residents rather than corporate hotel chains (if you show higher multipliers, maybe some good externalities like supporting artists). But that's a very complex assessment in itself, likely way beyond the scope of this study. And you've got to count only net benefit versus the counterfactual.
(3) Sure, AirBnB guests might stay longer and spend more (what data is that based on? Don't many people use AirBnB because it's cheaper?), but that correlation doesn't mean that some magic AirBnB pixie dust caused them to do so. And is this offset by less money spent on the lodging itself compared to an hotel?