The tourist 'swamp': new study argues zoning laws needed to combat Airbnb impact

By Rebecca Stevenson

Tourists renting Airbnbs and “swamping” communities can drive out local residents and drive up apartment rents, and a new study argues zoning rules could be used to lessen the impact of the sharing economy platform.

The study, by Auckland University business school Senior Lecturer in Property William Cheung and Associate Professor Edward Yiu, found Airbnb listings help to increase rents in areas with lots of apartments such as in a central city area, but Airbnb rentals can reduce residential rental prices in low-density, house-dominated neighbourhoods.

The impact of short-term Airbnb rentals is much more problematic in residential neighbourhoods, Cheung said.

“In low-density residential neighbourhoods locals are more likely to notice strangers or increases in noise, and their area may not have the resources to cater to influxes of visitors. When visitors begin to swamp a community, local residents will be less willing to pay rent for that location and will move elsewhere.”

The researchers say designated zoning could give cities, including Auckland, flexibility to supply tourism accommodation while “avoiding creating severe urban conflicts in low-density suburbs.”

Cheung said having zoning for where Airbnbs can operate could take into account whether there is appropriate infrastructure in the area, for example.

A previous study found that destination management models overlook the role urban zoning could play in managing tourism.

Instead, a "novel zoning approach" could cover the needs of short-term accommodation options like Airbnb, and of permanent commercial hotels.

Using zoning to decide where short-term accommodation can operate could gear up the tourism sector to cope with the rapid growth of the sharing economy, and align with sustainable tourism to ensure long-term socio-economic benefits to stakeholders, the study said.

Cheung said tourists will pay higher rents for convenience, and in high-density inner city areas, rents will be higher as visitors compete with people who would like to live in the city centre in order to enjoy better accessibility.

The study found an influx of tourists into an area may cause services, facilities and shops to be reoriented towards tourists’ preferences rather than residents.

The study calls this process “touristification”. The researchers found that along with these changes, noise and overcrowding are a drawback from the tourists that come hand-in-hand with Airbnb-style accommodation.

When visitors swamp a community, residents are less willing to pay rent to live there and will move, the study says.

The new research is part of a series of studies Cheung is undertaking which will look at touristification.

His next study will look into how touristification affects retail.

The pressure that short-term rentals like Airbnbs places on housing availability has caused angst.

In Wellington advocates are calling for a “crackdown” on Airbnbs, and for Airbnb listings to be levied with the same rates that other accommodation providers face.

Earlier this year, the Christchurch City Council decided Airbnbs would need a consent to operate. The cost of such a consent is estimated to be more than $1000.

Airbnb called the rules “most restrictive and outdated home sharing laws in Australasia”.

Chueng said consenting changes like those in Christchurch won't determine where Airbnbs can operate, whereas zoning laws could.

Airbnb is also under scrutiny with Government plans to force the accommodation platform, and Uber, to levy GST on bookings.

At the moment Uber drivers or Airbnb hosts have to pay GST themselves.

A 2018 Deloitte report for Airbnb found Airbnb guests make a significant contribution to New Zealand’s economy, contributing $660 million in GDP and supporting over 6,000 jobs.

Airbnb has been contacted for comment.

This story was originally published on Interest.co.nz and has been republished here with permission.