Wednesday, February 19, 2025


Taking stock: how has 10 years of Airbnb changed Australia?

Julie Lawson started her business four years ago in Port Douglas (north Queensland), offering property owners who wanted to rent out…

By Chan , in Travel , at February 29, 2024

Julie Lawson started her business four years ago in Port Douglas (north Queensland), offering property owners who wanted to rent out their home on Airbnb a “meet and greet” service. She began with four properties and had a plan to keep them small.

Bees Knees Holiday Rental and Property Services expanded quickly after recognizing a high demand for their services. Lawson’s number of properties doubled even during the period when the pandemic closed borders. She says that “a lot of properties were purchased by southerners and we have taken them on as their agents.”

Bees Knees now manages more than 40 Airbnb properties in Port Douglas. Lawson provides everything that an absent Airbnb owner cannot – from maintenance of the property to providing travel advice to guests. She has an assistant, contracts work out to cleaners, linen rental companies, electricians, air conditioning services, plumbers, and maintenance workers, and hires an assistant. She regularly orders tea, coffee, and other household items. She says, “We like to keep things local.”

She is now struggling to find employees who can afford to live close enough to look after her properties.

Airbnb launched in Australia in 2012. Since then, millions have used the platform to book accommodation. Airbnb has ushered in a number of fundamental shifts, from the willingness to transact with strangers online and to sleep in their beds to the ability for anyone to live in another town like a native. It has also raised concerns about the impact of short-term accommodations, especially when locals are unable to find a place to live.

According to Dr Thomas Sigler of the University of Queensland, the rise of “micro-entrepreneurs” like Lawson is a result of the meteoric rise of digital platform companies such as Uber, Airtasker, and Airbnb, also known as the sharing economy. He says that many people criticize Airbnb and other similar companies and consider them exploitative. But there is also the notion that they empower people.

Prof Nicole Gurran

 

The platform has helped hundreds of thousands of Australians earn money. Sigler’s research and that of his UQ colleagues show that, between 2016 and 2019, nearly 350,000 homes were listed at least one time. The average increase in listings per month was 2.43%. Sigler claims that the pandemic’s closed borders reduced listings.

Prof Sara Dolnicar of UQ, a tourism researcher, predicted that the “coronavirus has disrupted Airbnb” and that investors will put their property on the market for long-term use “and never go back to Airbnb.”

She says, “I was wrong.” Everyone is back in the short-term markets where money can be made.

Airbnb has changed the way we travel. Airbnb allows us to book directly, use guest reviews in place of star ratings, and collect keys for an entire home with bedrooms, kitchens, and even a pantry.

Nicole Gurran is a professor of Urban and Regional Planning at the University of Sydney. She says that the company’s “phenomenal” marketing campaign has changed the “geography of tourism.” Previously, we searched for accommodation only in established tourist areas. Now, the options are almost endless.

Gurran says that any home located in a tourist destination can be converted into tourist accommodation within ten days, compared to the traditional hotels, which require time and cost as well as regulatory approvals.

Now, residential neighborhoods and small villages can be visited for a more “authentic travel experience.”

Airbnb’s incredible growth in popular tourist destinations is a testament to this. Gurran says, “With the idea of going to a destination and living where the locals do, I would say that Airbnb has sold us something we didn’t even know we wanted.” In Byron Bay, for example, 17.6% (or nearly half) of all housing stock in the town is listed on Airbnb. She says that the irony of it is that many locals are now unable to live in those places.

From couch surfing and management companies

Airbnb has come a long way since its founding premise, the airbed in an extra room. It was founded in 2008 after two San Francisco flatmates rented an air bed on the floor of their living room. Dolnicar says that the initial appeal of Couchsurfing was similar to what people were used to. “It was personal, very local, and very connected. This is no longer the case. “Now it’s just another accommodation provider.”

Sigler’s Australian data analysis shows that the number of listings for entire homes is growing faster than that of shared accommodation. This suggests that the listing of whole homes is becoming “professionalised” and that management companies, rather than individuals, are increasingly leasing properties on a full-time basis. ‘Entire home listings,’ however, do not mean that a property will be rented year-round. They can also include sections of larger homes.

Sigler and colleagues have conducted new research that has not yet been published. They found that Airbnb offers a higher rental return for short-term rentals compared to long-term rentals. This is especially true when the property is located near a beach or city center.

Gurran states that according to data from Inside Airbnb (an independent data scraping company), the proportion of Airbnb homes permanently reserved as holiday accommodations – rather than being hosted accommodation in a house where someone lives – is greater than a third.

Susan Wheeldon is the Airbnb manager in Australia and New Zealand. She notes that most properties aren’t listed all year round but on a “casual basis” to help [hosts] pay their mortgages and bills or save money for retirement.

Trish Burt is the leader of Neighbours Not Strangers, an Australian lobby group that opposes holiday lettings in residential areas. She says that she has spoken to people all over Australia about their “living hell” when living with holiday rentals. “You don’t know who lives in your building. You have people mixing in corridors. You have drunk people trying to enter your apartment. And you have forced people out.”

Gurran says that attempts to regulate Airbnb are common. “You can see it in New York, San Francisco and Dublin. They all have similar problems with the way Airbnb is consuming housing stock, disturbing residents, but they all have to go to court separately.” Property owners, not Airbnb, often fight the legal battles. One case involved a Gold Coast council being sued by a property owner for trying to raise rates on holiday rentals.

Short-term rentals are being regulated across Australia. This is primarily due to local councils, which the housing crisis and local complaints have impacted. Brisbane City Council has increased rates for these properties, and Broome Shire council requires them to register. New South Wales has implemented a state-wide planning policy which overrides any local planning controls. The state planning policy mandates a fire safety code and a code for conduct. In greater Sydney, unhosted listings are limited to 180 days per year. The state does not have any limits on how long a property may be rented as an Airbnb. Byron Bay has been negotiating a cap of 90 days.

Burt claims that the NSW regulation won’t address the primary housing issue and that it will give priority to investors rather than those who are in need of a home. “The system is flipped on its side.”

It’s sneaked into all residential areas

Lawson, who runs a Port Douglas business, is being forced to limit the amount of work she can do because tourists are returning in large numbers. She says, “We cannot get cleaners because they have nowhere to live.” She warns guests that she hosts to make reservations early at local restaurants, as many are operating with reduced hours due to the lack of permanent housing.

The housing situation in Douglasshire is a disaster, says Mayor Michael Kerr. The rental vacancy is at 0.4%, its lowest level in 15 years. Local businesses cannot take advantage of the return of tourists because they are unable to accommodate staff. “We are now in a very difficult situation where we simply don’t have enough accommodation for our staff.”

Kerr, as do many others in the shire, places some of the blame on Airbnb. Airbnb is welcome in many tourism areas that are part of our plan. There’s absolutely no problem. It’s spread to all residential areas, which is a problem. These houses were constructed with the intent of housing employees.

Airbnb is only one of many factors that experts agree are contributing to the severe housing shortage in Australia. The reasons vary from region-to-region.

Gurran says that Covid’s experience has shown the negative impact of short-term rental. The closed borders led to a decrease in the demand for short-term accommodation and a return of housing stock to the long-term market. Rental vacancy rates are dropping in many places now that borders are opened, and housing stock is flooding the short-term rental market.

In Hobart, 47% of the short-term Airbnb rentals had a history of long-term renting. The study found that removing just 195 homes from the private market could increase the rental vacancy rates from 2% to an extremely dangerous 1%.

It is more acute in regional areas, particularly those affected by shocks such as bushfires, which destroyed housing stock. The mayor of Eurobodalla on the south coast of NSW has written to 8,000-holiday homeowners in the shire to ask them to rent out their homes long-term.

Gurran says that “anything done for tourism will bite” in this market.

Wheeldon, an Airbnb representative, says that housing affordability is a “complex issue” with many contributing factors, including population movements, supply of new housing, ratio of public housing and interest rates, as well as broader economic conditions. Short-term rentals are a small part of the property market, but they play a crucial role in creating jobs and growing Australia’s economy.

Sigler acknowledges that Airbnb may not be the only cause of the housing crisis. He says that crunch or not, it will continue to grow, partly because people like it.

He says, “It is like Uber and taxis.” Taxi drivers do not like Uber, but I believe that taxi drivers are beginning to realize that Uber is the way of the future. Tax Ubers to the hilt, but people won’t go back to taxis. It’s not convenient to have to talk to someone to get a taxi dispatcher.