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Do short-term rentals increase housing prices? Quasi-experimental evidence from Lisbon

Susana Peralta (), João Pereira dos Santos () and Duarte Gonçalves ()
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Susana Peralta: Nova SBE
João Pereira dos Santos: Nova SBE
Duarte Gonçalves: Nova SBE

No 155, GEE Papers from Gabinete de Estratégia e Estudos, Ministério da Economia

Abstract: We provide causal estimates of the impact of short-term rental regulations by exploiting a quasi-natural reform implemented in the city of Lisbon. In November 2018, the municipality of Lisbon banned the registry of new short-term rental properties in some neighborhoods. We rely on two administrative data sets on short-term rental registries, between 2015 and 2019, and house transactions between 2017 and 2019. We also use data on Airbnb rental prices since 2018. We employ a difference-in differences estimation taking advantage of the spatial discontinuity in the registry ban. We document a spike in new registries between the announcement and the implementation of the ban, driven by domestic incumbent owners. Airbnb prices do not seem to react to the ban. Both the number of transactions and house prices decreased after the reform, mostly in two-bedroom flats. Our findings confirm a sizeable impact of short-term rentals on real estate prices, concentrated in a segment of smaller houses.

Keywords: Airbnb; Policy Analysis; Housing Market; Short-Term Rental; Portugal (search for similar items in EconPapers)
JEL-codes: R12 R21 R30 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2020-07, Revised 2020-07
New Economics Papers: this item is included in nep-eur and nep-ure
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http://www.gee.gov.pt//RePEc/WorkingPapers/GEE_PAPERS_155.pdf First version, 2020 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:mde:wpaper:0155

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