Airbnb plans to scale up worldwide a U.S. partnership with landlords who let their tenants host guests at their apartments. The multi-family market represents a mostly untapped greenfield for Airbnb. And vice versa.
Airbnb touted early progress Wednesday for its new listing service, where owners of multi-family properties allow tenants to occasionally rent out their units — in exchange for a share of the revenue.
The real-estate program launched in the U.S. in November with about 175 buildings in 25 markets. It now has 260 properties in 40 markets. That’s roughly 100,000 U.S. apartments, still a small slice of the approximately 6 million listings on Airbnb worldwide.
“About 35% of the housing stock is rentals, and we haven’t scratched the surface of that,” said Jesse Stein, global head of real estate at Airbnb, during an interview on-stage at Skift’s Short-Term Rental Conference in New York City.
The program points customers to “Airbnb-friendly apartments” for free. Landlords take a share of up to 25 percent of the revenue from a rental.
“Providing renters the same ability as homeowners to obtain the economic benefits of Airbnb is definitely something we’re keen to focus on,” Stein said in an interview with Seth Borko, a senior research analyst at Skift.
Airbnb is seeing the most interest from multi-family developers who have new buildings to lease. One survey of developers found that being “Airbnb-friendly” is one of the top three most popular amenities, Stein said.
“It’s a way to differentiate their assets,” Stein said. “The underlying collateral is still a 12-month tenant. But the program gives a building manager transparency into how tenants are hosting, and it drives incremental income to a partner.”
Older buildings are often hampered by clauses in condominium charters that restrict sub-letting, and these can be hard to unwind.
Regulation in some jurisdictions, such as New York City, makes it impossible for Airbnb to offer the program to local landlords and tenants, and so it avoids those markets.
“We’re in a good place globally for regulation, and New York City is one of the outliers,” said Stein. Earlier this month, Airbnb filed a suit against New York City over a law that restricts how residents can host short-term rentals as of July.
Photo credit: Jesse Stein, global head of real estate at Airbnb, at the Skift Short Term Rental Summit 2023 in June 2023. Ryan Bourque / Skift