Platform urbanism has reshaped urban living, but nowhere are its impacts as dire as in rental housing. Housing as shelter represents a basic human need and it is therefore hard to overstate the importance of housing platforms’ impacts on markets, access, and the sorting and distribution of people.
Although both LTR and STR platforms raise concerns, current research makes clear that policymakers should be more concerned, for the time being at least, by those purveying STRs rather than LTRs. Before STR platforms existed, accommodation options in cities throughout the developed world were abundant, varied widely in price and quality even in the most popular destinations, and were generally only in short supply briefly, such as during major sporting events or large conferences. If Airbnb, Vrbo, or their competitors disappeared tomorrow, out-of-town travel would continue. LTR platforms, by contrast, bring new visibility and scope—akin to what has long existed in residential sales—to the heretofore opaque rental housing market (Boeing et al. 2020b). For the time being, they do so without imposing significant costs on rental homeseekers. For instance, while Craigslist charges small fees in a small number of municipalities to landlords listing available housing, it does not profit from brokering lease agreements, and therefore does not extract excess profits from people who fulfill this basic need.
While LTR platforms like Craigslist reproduce systematic biases that have long existed in rental markets, STRs amplify existing inequalities and create altogether new ones. This is a consequence of how the STR and LTR rental markets interact with each other. The former exists primarily through parasitically absorbing a portion of the latter. STR industry rhetoric, as implied by the phrase “homesharing,” holds that guests absorb otherwise slack residential capacity by staying in spare bedrooms of permanent housing units or occupying the entire unit while the resident is out of town. In the early days of Airbnb, this was a fair characterization of the STR market. However, robust evidence now exists that a substantial—and continually growing—portion of the STR market comprises entire units that otherwise would be used for LTR housing (Wachsmuth and Weisler 2018; Combs et al. 2020; Garcia-López et al. 2020). Housing space originally created for a city’s residents is now reapportioned for use by its visitors through these platforms. This comes at a time when low-income rental housing, in the United States at least, is scarce not only within the usual list of high-priced coastal cities, but in every type of urban, suburban, and rural setting (Joint Center for Housing Studies 2020).
Although STR platforms’ spokespeople claim, when arguing in the policy arena, that they act as mere facilitators of transactions between guests and hosts, they tell a different story to their users. They burnish a brand with certain connotations, such as the culturally astute Airbnb frequent traveler (“don’t call her a tourist”) who learns about her destination by staying and interacting with a local host. LTR platforms are different. Finding permanent housing is not something someone is eager to do frequently. A typical person seeking rental housing is looking for the right type of place in the right location at the right price, and likely cares little whether the transaction is brokered via Trulia, Craigslist, or analog means. LTR platforms therefore behave more like genuine marketplaces and less like brands.
This distinction has real consequences. Brands entail exclusivity in direct tension with transparency. In this light, it is unsurprising that Airbnb opposes fully sharing its data with researchers and governments. By contrast, Zillow readily shares its rental listing data with researchers, enabling entirely new lines of research such as questions about whether and how new market-rate multifamily buildings affect the rents of nearby existing rental housing (Asquith et al. 2019; Damiano and Frenier 2020), and whether and how STRs impact rents and housing prices (Barron et al. 2020).
Yet sharing data does not make Zillow or any other platform, like Facebook or Redfin, inherently virtuous. Zillow currently profits by selling advertising to and providing some marketing services for agents and property owners/managers, so it faces less urgency to commodify its data. But in theory, given its market power, it could create tiered access to properties such that consumers would have to pay more to see more listings. Moreover, Zillow Group, which in addition to Zillow also owns Trulia, StreetEasy, RealEstate.com, and other websites, could begin to provide other housing services (e.g., mortgage lending, direct brokerage), which would only increase the corporation’s power and monopoly potential.
Like Zillow and unlike most STR platforms, LTR platforms tend not to profit from individual transactions, so the question remains how to induce STR platforms to behave more transparently. This would benefit researchers, but more urgently, it would allow cities to act on escalating calls by their residents for more robust monitoring and enforcement of new regulations to manage disruptions to quality of life and safeguard scarce rental housing.