The overwhelming majority of Tel Aviv’s Airbnb rentals are concentrated among a small group of businessmen and companies, contrary to the global company’s branding and reputation as a leader of the so-called sharing economy.
Airbnb’s listings in Tel Aviv and Jerusalem in 2017 were the subject of a study by Avner Barak and Prof. Yifat Holzman-Gazit of the Heth Academic Center for Research of Competition and Regulation at the College of Management Academic Studies. They found that thousands of apartments in Israel’s two major cities, defined as “commercial assets,” were available for rent for at least 180 days during the year, were the subject of rental deals at least once a month and were sublet for some 60 nights during the year.
Of the 8,800 units listed for rent via Airbnb in Tel Aviv, 4,200 met the criteria for being considered commercial assets. Some 1,300 people were responsible for managing these assets.
The two researchers identified three major “hosts” in the seaside city: one person responsible for deals involving 240 Airbnb apartments, another for 123 apartments and a third for 106 apartments. Another 1,700 properties were managed by a group of 72 people, with each one responsible for an average of 24 rental units. Another 2,000 Airbnb apartments were rented out by 1,300 people, each of whom were responsible for one or two units.
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The situation in Jerusalem was similar: The majority of units available for short-term rental, according to the study, were controlled by a small group of people. However, there are fewer of those units than in Tel Aviv.
In Jerusalem, there were 2,800 Airbnb listings, including 1,660 units that could be considered commercial assets. One-quarter of them were managed by 50 hosts – an average of eight apartments per individual.
Jerusalem, too, boasted several hosts who stood out for their share of the market: The researchers found that one had 72 assets for rent, another had 42 units and a third had 39. The remaining 330 hosts in the city were each responsible for one or two apartments.
The largest physical concentration of Airbnb units in Tel Aviv can be found in the city’s historic center. The neighborhoods with the highest number of Airbnb apartments are Kerem Hateimanim, where 16.3% of all housing units are available for rent; Neve Tzedek, where 8.4% can be rented; and north Jaffa, with 6.4% of all apartments available via the site.
Holzman-Gazit, a lawyer with expertise in land expropriation in Israel, and Barak, a city planner, are the first people to conduct research on the distribution of Airbnb apartments in Jerusalem. They found the highest concentration of short-term rentals in its veteran, well-planned neighborhoods: downtown along Jaffa Street, as well as in Talbieh, Musrara, Mamilla and Nahlaot. In Talbieh, some 10% of all housing units are listed for short-term rental on Airbnb; in the city center, 8% are available; and in Musrara and Mamilla, 5% appear on the site.
“What should worry planners isn’t the phenomenon itself, as people have ‘hosted’ others in their homes for some time,” says Barak. “What should be of concern is the concentration [of control over properties by a few individuals] that has arisen as Airbnb develops in cities that draw international tourists.”
In such a situation,” he adds, “the effect on the housing market is worse, because there’s a greater chance that a significant portion of the apartments available to rent will be used for short-term rentals. A neighborhood thus turns from being a residential one into a tourism hub.”