Platform capitalism and short term rentals are boosting housing commodification and urban financialization. Worldwide, struggles for the right to housing and the city are fighting back, expanding knowledge and building tools to address the impacts of temporary rentals.
I talked about this with Katalin Gennburg, Member of Die Linke in the Berlin House of Representatives, philosopher and researcher of urban space, at the Rosa Luxemburg Foundation in Buenos Aires on November 12, also the occasion for presenting the Global Observatory of Temporary Rentals!
Read about the Global Observatory on Temporary Rentals:
The Global Observatory on Temporary Rentals arises from the impulse of Latin American organizations working on access to housing with a human rights perspective, which have been conducting research and action on how capitalism and the financialization of habitat as its new stage are developing in cities, and how urban extractivism, housing crises, evictions, gentrification processes and the configuration of rental landscapes are manifested.
It emerges as a network affirming the need to join efforts based on the recognition that the expansion of temporary rentals is a problem that cuts across the agendas of different organizations. The Observatory seeks to articulate with existing urban struggles that share a human rights perspective and with public administrations that, even without this approach, work to improve access to housing.
As a Latin American project, it assumes that the impacts of the phenomenon reach the region with a certain time lag and with particular characteristics, and it is from this place that it intends to link itself with other networks, feed the global discussion, nourish itself from the trajectories of thought and action that have been developed in the North for more than a decade and feed them back from the work of organizations in the South. This contribution of their specificities is necessary to build alternatives and counter-narratives to the expansion of temporary rentals worldwide and its impact on the realization of the right to adequate housing and the city.
Thus, the Temporary Rentals Observatory seeks to be a meeting place for advocacy and coordination of actions before international organizations, national, district and local governments, a space where each organization can take ownership of the contents, participate in the growth, in a self-managed and collaborative way.
Background
The growth of temporary rentals worldwide is one of the central threats to access to housing in the 21st century. Its geographic expansion, which can be seen in the most diverse cities, and its quantitative expansion, which can be seen in the volume of housing offers and money managed through platforms, occurs in a context of generalized deregulation, where the inability of governments to design and implement adequate regulations results in the violation of the right to adequate housing for growing parts of the population.
Access to adequate housing is an increasingly unattainable right for a growing population worldwide. According to UN Habitat estimates, by 2030, when the implementation horizon of the Sustainable Development Goals will be met, more than 1.5 billion urban households will lack decent housing and another 1 billion will need new housing. The difficulties of accessing adequate housing range from people living on the streets, in informal settlements and other forms of precarious tenure, to middle-income sectors with insufficient salaries to afford the cost of housing in central areas, who often go into debt to pay rent or move to the peripheries.
In the general process of real estate financialization, housing as an investment vehicle is constantly finding innovative forms that expand the frontier of urban rent extraction. Although temporary rentals are traditionally associated with tourist residences, their massification involves middle and high income sectors and “new citizenships” such as the “digital nomads”, a group that combines the mobility of tourism with remote work and, in many cases, economically displaced from their countries of origin. They also bring together “pendular” people: tourists, workers, students and migrants who reside in cities from a few nights to several months and contribute to blurring the traditional categories among those who use cities.
Several studies[1] show the relationship between the expansion of the supply of temporary rentals and the dynamics of the increase in the price of permanent rents and eviction processes of the tenant population. This is evident in large cities that, from Lisbon to London, are airbnberized in European and North American countries, to small urban agglomerates in the Global South. Hotels are being bought and converted to supply via platforms; various developers rent out all the units in a building, as if they were regular long-term tenants, but using all the units as temporary rentals.
In order to reactivate the economy in the post pandemic, in the face of serious problems of housing affordability for its population, without prior analysis of the housing market, without measures to control speculation and in certain cases in the absence of tenant legislation and regulations that typify and regulate temporary rentals, cities like Buenos Aires and Mexico City have even signed Memorandums of Understanding with the Airbnb platform (sometimes in exchange for donations as in the case of the Mexican capital) to increase the number of digital nomads and facilitate their arrival through VISAS designed for this purpose and tax exemptions. It is central to study the active and multilevel role of the States and the incentives granted not only for the installation and growth of these platforms but in general to attract capital to the real estate sector. It is interesting to see at different scales the action of governments to capture large capitals and favor the real estate market and tourism.
The expansion of the temporary rental market has implied the consolidation of a specific real estate sector with a diverse and complex ecosystem of actors that affects the entire production chain of the urban process, from the regulations that establish which typologies are suitable for temporary rentals, to the characteristics of the end users. Companies dedicated to rental securitization have begun to expand. Information began to be collected on co-hosts, a kind of “assistants” that will help to discover new networks and mechanisms that are being implemented for the expansion of rental platforms.
It is important to highlight the processes of counter-narrative control and lobbying that rental entrepreneurs carry out through the co-organization and sponsorship of international events and activities, for example, on the housing crisis. AirBNB sponsors, co-organizes, participates and has direct and personal dialogue with both official and opposition parties in the UK. This element of AirBNB’s control of the counter-narrative involves all kinds of actions.
As shown by several studies, the demand for units for sale whose final destination is short term rental through platforms induces a greater production of small units, located in neighborhoods with better provision of services and urban infrastructure, and even buildings conceived entirely for this market. One of the most important changes that has been generated with the rise of temporary rentals is that now time and not space is the central point that defines the offer. It is necessary to confront temporary and/or platform rental as a new economic model for cities, a new housing industry; and not only as a phenomenon that affects access to housing. In Portugal AirBNB, Uniplaces and Booking are part of the business world. In Lisbon there are 130 companies with more than 10 records of tourist apartments offered on AirBNB, this shows that, although there is still a large number of small owners, there is already a progressive movement towards companies that manage temporary rentals.
Another question to be highlighted is that these logics are also crossing popular housing. Temporary rentals are gaining ground in informal settlements, slums and favelas. We are facing rental production with accumulated capital (mainly from drug trafficking) from below and above. 25% of the housing market in popular neighborhoods is rented and is managed based on the logic of financial profitability of the space.
Objectives
- To contribute to the understanding of the phenomenon of temporary rentals in the world, through the production and systematization of information, research and the production of dissemination contents.
- To strengthen the struggles for the right to housing, through instances of collaboration, exchange and articulation of actions on temporary rentals between activists, academics and social organizations for human rights.
- To promote the adoption of public policies and regulations to guarantee the right to housing, based on cooperation with governments so that they include the issue of temporary rentals as a strategic issue.
[1] Among them: Garcia-López, Miquel-Ángel (Et. Al), ¿Afectan las plataformas de alquiler a corto plazo a los
los mercados de la vivienda? Evidence from Airbnb in Barcelona, Universitat Autònoma de Barcelona and IEB, Universitat de Barcelona and IEB, RITM, University of Paris Sud- Paris Saclay, Junio del 2019. Available at: https://mpra.ub.uni-muenchen.de/96131/1/MPRA_paper_96131.pdf ; Merante, Mark; Mertens Hor, Keren; ¿Está haciendo subir los alquileres el uso compartido de viviendas? Evidence from Airbnb in Boston, Documento de trabajo 2016-03, Departamento de Economía, Universidad de Massachusetts, Boston. Available atn: http://repec.umb.edu/RePEc/files/2016_03.pdf ; Shabrina, Z., Arcaute, E., & Batty, M. (2022). Airbnb and its potential impact on the London housing market. Urban Studies, 59(1), 197-221. https://doi.org/10.1177/0042098020970865
