MEASURING THE IMPACT OF AIRBNB ON LOCAL HOUSING RENTS: THE CASE OF ISTANBUL, TÜRKIYE

Abstract

Both academia and the business world have paid increasing attention to the growth of the sharing economy. They were often driven by their curiosity about how this new business model shapes market mechanisms. Quite a number of authors have already examined the sub-category of sharing economy, home-sharing. Specifically, they studied how this platform affects the hospitality and residential housing markets. Although researchers have extensively covered relevant topics despite the short history of home-sharing platforms, policymakers still grapple with the negative externalities of the rapid growth of home-sharing. However, municipal decision-makers cannot make reasoned policy decisions without an in-depth, strategic analysis of this topic.

The term ‘Airbnbfication’ was even recently coined to describe Airbnb-induced gentrification, a morphological transformation of a community into a tourism commodity. However, the existing literature heavily focuses on the United States and Western Europe. No scholar has studied whether the same issues are happening in Türkiye, a unique location where Europe and Asia meet. Specifically, this research focuses on whether rental price increases are correlated with home-sharing concentration at the district level.

Based on empirical data in 39 districts of Istanbul, this thesis explored the home-sharing housing supply (2017–2022), rental prices (2019-2022), and population growth (2018-2022), verifying a solid association between holiday rental concentration and increasing rental prices. Depending on the lag, every percentage point increase in the number of Airbnb listings was associated with an increase that ranged from 0.368% to 0.497% in average monthly rents, fixing the effects of time and district in the districts with more than 1,000 Airbnb listings.