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Brandon Griggs

Resilience Reflection #14: A shortage of student accommodation?

In this week's issue of Resilience Reflections, Jodi Sturge argues for regulations to restrict short-term rentals and suggests measures to incentivize long-term rental housing to relieve the tight housing market.

In this regular series by the Resilience@UT and 4TU Resilience programmes, UT researchers share their personal reflections on current events and trends that impact our daily lives, exploring their implications for resilience. The series is just one of many UT initiatives responding to the urgent need to respond to rapid societal and environmental change. As an academic institution, we have a role to play in strengthening the resilience of the social, technological and environmental systems that support us. The opinions expressed in this article are the author’s own.

A shortage of student accommodation: is it really internationalization or could it be the financialization of short-term rentals?

As the Dutch government plans to centralize the management of internationalization, there is a piece of the puzzle that is never discussed: the impact of short-term rentals on the student housing market. The sharing economy of short-term rentals, such as the Airbnb platform which was developed by two industrial designers, has effectively created a new rental housing category, disrupting the affordable housing stock across North America and Europe. Barcelona’s mayor, Ada Colau, explicitly linked Airbnb with housing stress. Berlin has cracked down on short-term rentals in hopes of keeping housing affordable. More expensive cities such as London and Amsterdam have limited the number of short-term rental nights allowed per property (Wachsmuth & Weisler 2018). It is not only the large cities that are being impacted by Airbnb activity but also smaller cities and communities, such as Enschede, that are losing their longer-term rental housing stock.

Restricting short-term rentals

Researchers (Li et al., 2022) have been exploring the link between the lack of affordable housing and Airbnb. Critics argue that short-term rental operators avoid regulation and taxation imposed on typical businesses, contributing to higher rents. As a result, cities are attempting to discourage commercial interests in the short-term rental industry. Restrictions are being introduced in some municipalities, such as allowing only the rental of primary residences or banning the use of investment properties for short-term rental. In cities such as Amsterdam, owners are now restricted to 30 days a year, and the owners are finally paying taxes on their revenues and require a license to operate. Despite several policies and regulations to mitigate the impact of short-term rentals on communities across the city, some of these efforts are loopholed or overturned by the courts.

Incentivizing and revitalizing long-term rentals

The sharing economy of short-term rentals is also disrupting the student housing market. Units once rented to students long-term are now only available short-term with steep profit margins. Additionally, there are no incentives to provide affordable student housing. To achieve this, the short-term rental industry must be appropriately regulated and incentivize investors to provide affordable accommodation. Incentivizing long-term rentals will likely highlight that the shortage of student accommodation is less driven by demand from international students and more related to housing stock that has been gentrified for profit. Further, design-led solutions to this wicked problem could re-direct housing policy and strengthen the resilience of the student housing market and communities.

References

  • Li, H., Kim, Y., & Srinivasan, K. (2022). Market shifts in the sharing economy: The impact of Airbnb on housing rentals. Management Science, 68(11), 8015-8044.
  • Wachsmuth, D., & Weisler, A. (2018). Airbnb and the rent gap: Gentrification through the sharing economy. Environment and planning A: economy and space, 50(6), 1147-1170.

Photo: Brandon Griggs on Unsplash

About the author

Jodi Sturge is an Assistant Professor in IxD, Department of Design, Production and Management (DPM) with the Faculty of Engineering Technology. Before moving to the Netherlands in 2018, she worked for the City of Vancouver, providing social housing to vulnerable people with a policy focusing on housing affordability.

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