Airbnb, a cornerstone of gentrification


[Ed. note: while this article is not about Venice specifically, the Airbnb phenomenon is undoubtedly a big part of the housing crisis there, as in many other cities.]

In 2011 the New York Times presented it as “a Web site that simplifies the process of renting spare rooms to travelers”. Some years later, Airbnb is much more than that. It is a symbol of the Sharing Economy that invites sustainable tourism. It is a giant that lowers costs and overshadows the traditional market for vacation lodgings. It is a brand that speaks of a Win-Win Situation: we provide earnings for those who rent their private property (much more than could be obtained through medium or long term rentals); we provide savings to those who want to rent, and we take a commission for our trouble. In this sense, it is a cornerstone in the process of gentrification.

But there is another side to this. Because the mediation between request and offer could be said to be completely to Airbnb’s advantage: on the one hand there is a cost, though relative, on the other hand any conflicts must be resolved by the property owner and the renter. Because the platform impacts the living conditions of an area, as we will see, becoming part of a process of displacement, and because it extracts value from hospitality without producing anything, some have ended up defining it as a form of sharecropping.

There are three million listings worldwide. Italy ranks third, after the United States and France.

Airbnb was born in San Francisco, in a loft, and those who recognize the processes of gentrification will recognize in Airbnb two giveaway elements of that process. In the summer of 2008, there was a convention in the city that filled the hotels, and the founders of the portal, in order to pay their expenses, which were difficult to sustain, put the space in which they lived up for rent. A few years later, in another situation of pressure on local lodgings, the Airbnb portal was powerful enough to obtain a contract covering twenty thousand rentals during the 2016 Summer Olympics in Rio.

Back in San Francisco, something significant happened in the summer of 2016. On the walls of the mythical Chinatown in the city, the largest Chinese community outside of Asia, the oldest in the United States, posters appeared with the photographs, names and last names of Airbnb renters in the neighborhood.

There were twelve people, represented as bandits, with “Wanted” written over their heads. The writing, in English and Chinese, accused: “Gentrification of Chinatown”, “Airbnb’ing our Community”, “Destroying accessibility of low cost housing for immigrants, minorities and families”. This attack was a reaction to the soaring prices of housing in the quarter, and rooted in its historical resistance to gentrification, already demonstrated in the successful opposition to the sale of the Fong Building at the end of the Nineties.

Without negating the evident relationship between Airbnb and gentrification, we can try to look at it from a different perspective. One who places his own space on the market is not necessarily the wealthy property owner that the protests suggest. In the case where he lives in the same apartment in which he rents a spare room, for example, he is renouncing something we might call livability. Certainly, it might be a pleasure to have company and meet people from around the world. But perhaps no; he may only need the money.

The protests in San Francisco are without a doubt based on this fundamental issue: the Win-Win Situation of the property owner’s relationship with the tourist leads to the neglect of the (less profitable) relationship with the long term renter.

This fact emerges from the research by LADEST at the University of Siena, a center which for some time has followed the Airbnb phenomenon. Specifically it emerges in the work on the Italian situation by Capineri, Picascia and Romano, who start from a simple assumption: each apartment listed on the portal is an apartment that is removed from the market for long term rentals, therefore for established residents.

In Italy, where short term rentals continue to grow each year, this is producing inequality.

In the same fashion the presence of Airbnb plays a role in the housing emergency in Los Angeles and in the boom in rental prices in Berlin (where, however, the restrictions which were applied in the past two years to combat the problem are in the process of being dismantled). Regarding Berlin, in 2016 the company claimed that it did not control enough apartments to be able to influence the rental market.

Short-Term Renting is concentrated in historic centers but tends to expand outside of these, according to LADEST’s research. In order to grow the presence of Airbnb in the urban peripheries, a key element is the neighborhood’s attractiveness “in the processes of urban renewal, of the decentralization of services (universities, hospitals), of the availability of high speed transportation networks and so on”.

In this sense, what has happened in the past few months in Rome is interesting. In the Pigneto quarter, a gentrified location and center of night life, the Retake teams rolled up their sleeves and undertook major cleanup work in November 2017. The objective was the usual “renewal” that seeks to chase the poor out, calling them a sign of decay. Alongside the Retake volunteers were Airbnb hosts, in a decorous alliance. Sarah Gainsforth observed, regarding this alliance: “If private space replaces public space via the rhetoric of sharing, public space becomes an extension of private, tempered with the rhetoric of participation”.

All this is in the face of a near future that will be announced with the signing of a lease, in a city which, since 2008, has seen its real estate market collapse, and which has given over its historic center to tourism like it was a theme park.

As Alison Griswold observed in 2016, commenting on the valuation by Yahoo Finance of Airbnb at 30 billion dollars, Airbnb “continues to present itself as a champion of the middle class… the hero of the situation, while the enemies are those who stand in the way of innovation, in particular the hotel owners’ lobby. …This narrative is in reality showing some cracks”.

In effect the past years have signaled a passage. On one side the voices of the Stock Exchange, which now don’t even make news. On the other, the controversies, the fines, the entanglements regarding the concentration of lodgings and fiscal regulations. Above all there is a short circuit between the narrative Airbnb promotes about itself and the volumes that it moves.

In the meantime, by 2017 it reached an impressive result: Airbnb now controls more rooms than are controlled by the five largest global hotel chains put together. And San Francisco, where it all started, is the city with the most expensive real estate market in the United States.

Source: I Diavoli, 7 May 2018      Photo: USA Today

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