Does Airbnb Disrupt the Private Rental Market? An Empirical Analysis for French Cities
Camille Grivault and
Julie Le Gallo ()
International Regional Science Review, 2020, vol. 43, issue 1-2, 76-104
This article evaluates whether Airbnb rentals affect the rents in the private rental sector in eight cities in France. We estimate a hedonic equation for each city on individual data for apartments, allowing for heteroscedasticity and spatial error autocorrelation of unknown forms and using a large variety of structural and contextual characteristics of the apartments. We show that the density of Airbnb rentals puts upward pressure on rents in Lyon, Montpellier, and Paris, whereas it has no significant effect in other cities. If we restrict the analysis to the professional business of Airbnb rentals, which we define as the lodgings owned by an investor who rents either several â€œentire homeâ€ dwellings (regardless of the number of days) or an â€œentire homeâ€ dwelling for more than 120 days a year, we find a greater effect, which concerns only the two largest cities of France, that is, Marseille and Paris. When we focus on new tenancy agreements, the impact is even higher and concerns Paris, Marseille, and Montpellier. The impact of the Airbnb activity on rents is shown to increase with the proportion of owner-occupiers and decrease with hotel density, both in Montpellier and Paris. However, the share of second homes leads to contrasting effects.
Keywords: Airbnb; rental market; hedonic model; spatial autocorrelation; apartment price (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:inrsre:v:43:y:2020:i:1-2:p:76-104
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