Airbnb rentals help juice local economy: study

Report on Vancouver benefits comes in wake of push by cities to regulate booking platform

Vancouver attracted 267

As B.C. cities grapple with options to regulate Airbnb, the online vacation rental broker has released a study that argues the money hosts collect has large positive ripple effects throughout the economy.

The economic impact study by University of Victoria business professor Brock Smith for Airbnb focused on the City of Vancouver, which intends to require business licences for all Airbnb operators, and use of primary residences only in a bid to stem what local politicians fear is a shift of long-term rental housing to lucrative vacation rentals.

It found the 267,000 Airbnb guests that stayed in Vancouver in the 12 months ended Aug. 31 spent nearly $180 million with local businesses, generating more than $400 million in total economic activity once spinoff effects are included.

Smith calculated that the spending by guests support the equivalent of 9,100 full-time jobs and $32 million in municipal taxes for the City of Vancouver.

The projected impacts drop considerably if a more conservative measure is used. The specific economic benefit is the spending that would never have been made had guests not been able to book through Airbnb, and Smith pegs that number at a more modest $23 million, supporting 518 full-time equivalent jobs and $1.8 million in local taxes.

Read also:  Airbnb pledges to help cities regulate, tax rentals

Smith said the economic impact of Airbnb in other communities in B.C., such as Victoria, would likely be proportional to the results for Vancouver, depending on the relative degree of local Airbnb activity.

“The average visitor in Vancouver was spending about $151 per person per day and that’s very consistent with a Tourism Victoria exit survey,” Smith said in an interview.

Airbnb stays represent less than three per cent of the nine million annual tourists to Vancouver.

The average host earns $6,500 a year and the average guest pays $60 per night, according to Airbnb. Most bookings in Vancouver were for entire homes.

Other communities across B.C., from Tofino to Nelson, have either regulated Airbnb or are weighing options.

An Airbnb official told a forum at the Union of B.C. Municipalities convention in September the booking platform was willing to collect and remit accommodation taxes in cities that require them.

Local politicians at that forum were warned Airbnb rentals are accelerating a crisis of scarce rental housing in many communities, and were urged to regulate the rapidly growing phenomenon to protect housing for residents, students and workers.

Since then, Airbnb has mounted a major advertising blitz as Vancouver council prepares to impose regulations.

 

 

 

 

 

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