Airbnb & the gentrification of large cities

Founded in 2008, the Airbnb vacation rental platform has more than 2 million online listings. In the space of a few years, it has established itself as the best alternative to hotel stays, advocating authenticity and the possibility of discovering a city like a native, immersing yourself with the locals.

Airbnb offers a wide range of rentals (rooms, apartments, houses, yachts, cabins, etc.), which allows it to attract customers from all walks of life. In addition, its benefits are not limited to vacationers since owners post their offer (s) online for free and rental rates are free. The success of Airbnb is such that hotels have struggled to find a solution to cope. There are also many hotel offers on Airbnb itself.

An easy-to-use platform, a multitude of offers, tailor-made searches, everything is there to sell the perfect "home stay"; but according to the press and local governments, this seasonal real estate giant poses more problems than it offers solutions.

What is gentrification?

According to Larousse, gentrification is a "tendency towards the upscaling of a working-class neighborhood". The consequences are that many are forced to leave their homes following an increase in rents and the price per square meter. The origin of the word dates back to the 1960s. Coined by British sociologist Ruth Glass, she used it to describe a new phenomenon she noticed in the UK, and more specifically  London . The term comes from the English word "gentry" which refers to the "upper class" and by extension the upper middle classes.
This upheaval affects most of the big cities today, where it tends to accelerate and amplify, until radically transforming the characteristics of urban socio-economic diversity. In France, the term appeared in the early 2000s.

What is the impact of Airbnb in the gentrification of large and medium-sized cities?

For some time Airbnb has been accused of being responsible for the gentrification of certain neighborhoods in large cities. The company is seen as having created the link between tourism and gentrification. Although it is not the only responsible entity, it has most certainly participated in the strengthening of this bond.

For example, Paris is considered the number one Airbnb market in the world. Nearly 100,000 apartments are offered to tourists, 60% of which are through the Airbnb platform. These accommodations are of all types (studio, house, apartment, etc.) and can be found in all neighborhoods. This desire to discover cities like locals, pushes tourists to previously rarely visited neighborhoods.

Naturally, this tourism encourages the establishment of businesses whose prices do not always reflect the means of the inhabitants of the district. Landlords, won over by Airbnb's offer, do not hesitate to increase their rent or not renew the leases of their tenants, which allows them to take full advantage of the platform's benefits.

Despite the efforts of governments, it remains very difficult to control these rentals and the problem persists. Discontent and anger are brewing in many cities such as Barcelona, ​​Mallorca and Berlin. “Anti-tourist” movements were born from this anger, sometimes supported by the municipalities. In 2019, more than ten municipalities implemented restrictions against Airbnb; unfortunately they were not always respected.

These towns and cities then seized the European Commission, in vain. Their goal of reducing, or at least controlling the frenzied development of online booking platforms, has not been successful.

It is important to note that gentrification is also caused by the mobility of young working people from privileged backgrounds who cannot find jobs and cannot settle in the neighborhoods where they grew up.

You might think that gentrification leads to more social mix, but more often than not, a process of geographical segregation is observed which only deepens socio economic differences.

How to preserve the social fabric of each district, while improving the quality of life of their inhabitants and opening them up to tourism?

This is one of the urban challenges of the next decade. One thing is certain, without the deceleration of online platforms and mass tourism, gentrification will continue to gain ground.