Until a few years ago, renting was considered to be a « residual » investment. It has since seen a rise in profitability and created a market of its very own. Not least thanks to a boom in short-term rentals, a new phenomenon which has taken off over the last three years. For example, it is estimated that in Italy at the end of 2018, at least one million of properties – a figure which has doubled in the last two years – are rented for periods during the year spanning from a national average of 4.5 months, up to over 9 month in tourist cities. This is obviously squeezing the traditional rental and sale market.

The Airbnb boom

Short-term rental platforms like Airbnb have grown disproportionately over the last few years. Since it was launched in 2007, Airbnb has become a multimillion-dollar business which now offers over 4.5 million ads in over 190 countries throughout the world. The new business model has transformed into an interesting opportunity for the generation of alternative income flows. However, this rise in popularity has also resulted in widespread discontent with this type of platform which has pushed accommodation prices up, while unlawful competition towards other forms of « hotelisation » is rife.

Reactions in different countries

Local governments throughout the world have responded in a number of ways to the regulation of short-term rentals.  Most cities have avoided any significant regulation of these platforms, however some have put stringent restrictions in place. San Francisco, for example, establishes a maximum limit of 90 days of short-term rental per year and collects a 14% transient occupation tax, whereas Amsterdam sets a 30 day limit.

Changes in the hospitality industry

Airbnb is already much more than a short-term rental platform. Its influence on the hospitality sector should not be underestimated. International hotel chains like Accor and Marriott International are adding short-term rentals to their portfolios. In the mean time, the two biggest online travel agencies Expedia and Booking Holdings are frantically expanding their portfolio of houses available for rental.

Following on from Accor’s purchase of the home share website Onefinestay for 148 million dollars in 2016, and Hyatt Hotels’ investment in the home-sharing startup Oasis, in 2018 Marriott also signed an agreement with Hostmaker to provide its guests with a short stay alternative to rooms.