Airbnb in Warsaw – characteristics of the market and challenges for the city
Many of the platforms associated with the sharing economy bring with them both benefits and new social challenges. This is also the case with the short-term rental market, which expands the offer for tourists and provides an opportunity for city residents to make money. However, the rapid growth of the platform can lead to various problems: higher housing prices for local residents, uncontrolled growth of tourism in particular neighborhoods, or a negative impact on the tourism sector.
RESEARCH METHODS AND DATA
MAIN FINDINGS OF THE STUDY
WARSAW IS DOMINATED BY OFFERS FROM PROFESSIONAL HOSTS
Of the nearly 5,500 Airbnb listings in Warsaw, as many as 57% are units whose hosts have four or more apartments on the platform. This proves the high level of professionalization of short-term rentals in Warsaw.
AIRBNB OFFERS IN WARSAW BY NUMBER OF LISTINGS PER HOST
SPATIAL DISTRIBUTION OF OFFERS IN RELATION TO TOURIST ATTRACTIONS
OFFERS ARE NOT EVENLY DISTRIBUTED ACROSS NEIGHBORHOODS
The geographic distribution of listings on Airbnb in Warsaw shows that they are concentrated in two neighborhoods: Śródmieście and Wola. Listings on Airbnb are spread out near some of Warsaw’s most popular tourist attractions and along subway lines.
IN THE ŚRÓDMIEŚCIE, AS MANY AS ONE IN 20 APARTMENTS WAS AT LEAST BRIEFLY ON AIRBNB IN 2018
Among all the apartments listed on Airbnb in Warsaw, almost half are in the city centre, while almost 20% are in Wola. Comparing data from AirDNA with data from the Central Statistical Office (GUS) on the number of apartments in given districts of Warsaw allows us to conclude that as many as one in twenty apartments in Śródmieście was at least for a while listed on Airbnb in 2018.
NUMBER OF UNIQUE AIRBNB LISTINGS PER 100 APARTMENTS, IN 2018
«TOP» HOSTS» SHARE OF VENUES, BOOKINGS AND REVENUE IN 2018
TOP 5% OF HOSTS REPRESENT OVER HALF OF BOOKINGS AND OVER 60% OF REVENUE
For listings active on Airbnb for 12 months, the median annual income is 22K PLN, while the average is over 27K PLN. At the same time, a high concentration of income can be observed among a small set of hosts: 5% of hosts were responsible for approx. 30% of locations offered, approx. 56% of bookings and 60% of revenue.
ON WEEKENDS THERE IS MORE COMPETITION BETWEEN HOTELS AND AIRBNB
Airbnb prices are lower than hotels, especially during the week, while on the weekend the difference decreases. Thus, it can be assumed that while on weekdays hotels are oriented towards business clients, during weekends they compete with Airbnb for clients coming to Warsaw as tourists.
PRICES FOR TWO PEOPLE ON BOOKING.COM: BIG DROP IN PRICES OF HOTELS DURING WEEKENDS (FROM 1026 TO 718 PLN)
HOTELS CHEAPER THAN AIRBNB: ONLY OUTSIDE CITY CENTERS AND BUSINESS DISTRICTS
COMPETITION IS NOT EVENLY SPREAD ACROSS ALL OF WARSAW’S DISTRICTS
Hotels are much more expensive in the center (about 80% higher prices than Airbnb), while in the few neighborhoods away from the center it is the hotels that are more affordable. It is also worth noting that weekend hotel rate reductions are higher in neighborhoods with more Airbnb listings available. This suggests a link between the presence of Airbnb listings and the hotel industry having to respond to the emergence of competition.
MOST AIRBNB LISTINGS EARNING MORE THAN TRADITIONAL RENTALS ARE PROFESSIONAL LISTINGS OF FULL HOMES, AVAILABLE FOR ALMOST YEAR-ROUND OCCUPANCY
Half of the apartments rented through Airbnb in Wola and Śródmieście earn more than the annual rent of a one-bedroom apartment through traditional means. For 2‑bedroom apartments, higher wages apply to 47% of Airbnb listings in Wola and 40% in Śródmieście.
ANNUAL INCOME HIGHER THAN… (BY HOST TYPE)
AIRBNB DENSITY (BARS) VS PRIMARY MARKET PRICES
NUMBER OF AIRBNB LISTINGS AFFECTS SECONDARY MARKET HOUSING PRICES
The number of Airbnb listings relative to the number of apartments has an impact on real estate prices in the secondary market: if the density of Airbnb in Żoliborz increased to the level in Wola, the price of apartments would increase by approx. 5–6%. Additionally, primary market prices are highly correlated with Airbnb density.
LIMITING THE POSSIBLE AVAILABILITY OF AIRBNB LISTINGS TO 90 DAYS PER YEAR WOULD AFFECT MOST LISTINGS
This type of change would primarily affect the offerings in Śródmieście. However, it’s worth noting that hosts could reduce the number of nights offered instead of a reduction in the offers themselves. This could result in some apartments being bought for rent anyway, but standing empty for much of the year.
AIRBNB LISTINGS (PER 100 APARTMENTS) THAT WOULD BE AFFECTED BY THE 90-DAY ANNUAL RENTAL LIMITATION