LA ranks number one in US for short-term rentals
US: According to research by real estate body CBRE, Los Angeles ranks highest in two core short-term rental statistics.
The city was found to have both the highest ranks in number of short-term rentals on the market, as well as the highest ratio of rentals to traditional hotel supply.
The information comes from a fourth quarter 2019 snapshot of the Los Angeles market, including data from leading platforms Airbnb, HomeAway/Vrbo, and Sonder. The information showed that active units have risen to 23,413, a nine per cent jump from the previous year.
This has finally brought the number of available properties rented in Los Angeles above those in New York, Airbnb’s other most important market. The number of properties has led the city to begin implementing measures to regulate and control these offerings.
City laws came into effect in October mandating additional reporting requirements and prohibited certain units from being listed as short-term rentals. Platforms have also been stricter in the area, with Airbnb de-listing twenty notorious problem properties in January.
The report notes that the Los Angeles hospitality economy is still in strong shape, with room rates steadily rising to around $180 a night. They note, however, that this may impact developers willingness to continue hotel construction, with short-term rentals filling vacant supply needs.
This falls in line with a recent CBRE report, which expresses concerns that short-term rental flexibility may impact the ability for the industry to properly judge revenues.
The news is seemingly a boost for the industry after a week of reports of heavy losses, with Airbnb reporting a loss of $322 million in the first three quarters of 2019. With an IPO on the horizon, data like this may assure investors that, though Airbnb has not reached full profitability, its market space is relevant going forward.
