Commentators blame Airbnb for rents falling

NEW Zealand rent prices recently dropped for the first time in a decade, leading some property experts to blame Airbnb owners for the drop.

Kiwi renters starting new rentals in May were offered marginally cheaper prices than renters starting new terms a year earlier, recent Government rent data showed.

Auckland and Queenstown renters got even better deals with prices down 0.5% and 9.5% respectively last month.

StatsNZ said the rent drops coincided with rumours holiday homes were being converted into regular longterm rentals due to the lack of foreign tourists.

Experts argued this was increasing the supply of rentals, giving renters greater choice and helping push prices down.

Now exclusive data from analysts AirDNA showed the number of Airbnb and Vrbo holiday homes advertised in May and June did drop significantly compared to the corresponding months last year.

However, AirDNA cautioned against interpreting the data as meaning Airbnb owners were converting their holiday homes into longterm rentals.

It said more than half of the world’s Airbnbs were not fulltime rentals, meaning the number advertised for rent always fluctuated and that AirDNA didn’t expect to see a longterm decline in supply of Kiwi holiday homes.

Understanding what is happening with Airbnb and other holiday homes has repercussions across the economy.

Renters already facing high rents stand to be the winners should an inflow of former holiday homes improve the longterm rental supply and push prices down.

House prices could also be pushed down should investors view an influx of new rentals on to the market as lessening their returns from buying new properties.

Hotels, holiday parks and motels could also benefit from a reduction in competition from holiday homes at a time when international tourism has dried up.

AirDNA’s data showed the number of holiday homes advertised for rent on Airbnb and Vrbo in June was 26,837, 2877 fewer homes than in June 2019.

The number of places offering private rooms for rent was 8682, down 4161 on a year ago.

This meant there were 102,319 fewer choices or ‘‘listing nights’’ last month for Airbnb users than a year earlier.

Total bookings hit 178,063 last month compared to 230,553 a year earlier.

Otago and Auckland were hit worst, with bookings down about 15,000 and 20,000 respectively.

AirDNA believed many Airbnb hosts were simply taking a break, however.

It said converting holiday homes into longterm rentals was expensive, especially with new Healthy Homes Government regulations due to come into effect and which require all rentals to meet stringent health standards.

Many Airbnb hosts had large bookings later in the year. AirDNA data showed there were more holiday homes scheduled for bookings this September than in 2019. — The New Zealand Herald