Airbnb’s NYC Listings Fall 77%, Big Hotelier Sees ‘Tailwind’

What impact would Airbnb’s diminishing New York City footprint have for hotels? One major hotel operator in the city believes the shortfall will contribute to a significant “tailwind” for hotels in 2024.

That forecast comes as Airbnb’s New York City listings for short-term stays — defined as fewer than 30 days — plummeted 77% from June 4 to September 10, which is nearly a week since stringent host registration rules went into effect, according to data that AirDNA provided to Skift.

And while Airbnb’s short-term rental listings fell to 4,600 from 22,500 three months earlier, listings for stays of 30 days or longer soared 48% to 34,900, and they now dominate the market, encompassing 87% of Airbnb’s total NYC listings, according to AirDNA. [See charts below.]

“We are bullish on New York and we view this as a tailwind,” said the C-suite official at a major NYC hotel operator, referring to the host registration requirements and new enforcement regime that kicked in September 5.

This top executive, who declined to be identified, is not an Airbnb hater. In fact, the hotelier tested selling hotel rooms from a half dozen of the company’s NYC properties through Airbnb, and one of them was generating about $100,000 in revenue per month, he said. [See more on these tests below.]

The hotelier pointed out that major hotel analytics firms were already forecasting about a 10% increase in revenue per available room for New York City hotels in 2024 versus pre-pandemic 2019. He thinks that growth could reasonably be 13% to 16% given the clampdown on Airbnb listings.

Not everyone in the hotel industry agrees. Some hoteliers argue that Airbnb’s inventory numbers are too low to have a big impact and that Airbnb merely handcuffs hotel pricing power during peak periods like holidays or major events.

The hotelier Skift spoke to cited other factors that would contribute to the 2024 tailwind, including a slowdown in the hotel development pipeline, hotel closures because of the pandemic, as well as properties being taken off the commercial market to house migrants.

Regarding the makeup of Airbnb’s current listings in the five boroughs, the first chart below depicts the sharp rise in Airbnb listings for long-term rentals, starting about a month before the registration rules kicked in, and the accompanying rapid drop in Airbnb listings for shorter stays.

Source: AirDNA

This second chart displays the listing property types — entire apartments and homes used for long-term stays, entire homes and apartments set up for short-term stays, private rooms for long-term stays, private rooms for short-term stays, shared rooms for long-term stays, and shared rooms for short-term stays.

Source: AirDNA

Airbnb’s Short-Term Rental Listings

Two things should be pointed out about the current dominance of Airbnb listings for stays of 30 days or longer.

First, the number of listings for short-term stays is “steadily increasing,” said Jamie Lane, AirDNA’s chief economist.

Second, a considerable number of Airbnb’s current listings for short-term stays are likely properties or rooms that are zoned as hotels, whether they are located in multi-unit residential buildings or in actual hotels.

Among other data points from AirDNA, long-term rentals of 30 days or longer climbed from 54% of Airbnb’s listings in June to 88% of total listings through September 10. That reflects the current paucity of options for weekend or week-long getaways, for example.

Also, AirDNA estimated that Airbnb’s number of total listings in the city has decreased around 12% to 39,568 as of September 10. They were already much lower than in 2019.

Meanwhile, Jonah Hanig, CEO of Rove, which offers luxury furnished rentals by the month, said the company has “seen a significant increase in demand” in the early days of NYC’s new host registration rules.
 
“With nightly Airbnb’s now illegal [stays in whole homes for fewer than 30 days], home rental options for 30-60 day stays may become more limited as many property owners convert their Airbnb listings to traditional long term leases,” Hanig said. “This may result in more broker-led listings and an opportunity for platforms like Rove that offer owners a way to make more money by placing higher paying medium term tenants successively.”

Airbnb as a Hotel Distribution Platform

The major NYC hotelier said Airbnb’s issues in NYC were not merely related to “illegal listings,” but involve its hotel distribution strategy, as well.

The hotelier had been testing selling hotel rooms from a half dozen properties on Airbnb, with some success, “but the platform is not very user-friendly for hotels,” he said. “You have to constantly update your content, come out with new creative taglines on a daily basis, and it doesn’t tie to anything right now. So it is pretty manual work.”

Specifically, the hotelier was listing hotel rooms on Airbnb, and not suites or larger spaces.

These tests proved that Airbnb consumers “are not looking for more space, they’re just looking for accommodations. Period,” he said.

The hotelier said he discussed these issues with Airbnb and its solution was to advocate that the hotels use sister brand and discounter HotelTonight instead.

Obviously, the Airbnb platform generates at lot more demand than HotelTonight so the hotelier didn’t view using it at scale as a viable solution.

Airbnb declined to comment on the major hotelier’s concerns without knowing more details about his company.