Advertisement

The Sharing Economy and Real Estate Market: The Phenomenon of Shared Houses

  • Leopoldo Sdino
  • Sara Magoni
Conference paper
Part of the Green Energy and Technology book series (GREEN)

Abstract

During the past decade, new forms of the sharing economy have been developed as an alternative tool for the satisfaction of heterogeneous needs. From both short- and long-distance transportation to the rental of apartments, this expanding economy has created a new private supply of those services that, traditionally, were only provided by professionals. In parallel with its unexpected development, the size of its impact on relatively traditional economic sectors has grown too. This fact has determined the need, an ever more one, for studies on the dynamics of this phenomenon. The short-term housing-rental sector plays a central role within the universe of the sharing economy. In fact, it has spawned a new rental market, parallel to the traditional one, that is characterized by short and very-short-term contracts and by the immediate and easily accessed encounter between demand and supply, made possible through the use of digital platforms. Airbnb plays, without any doubt, a leading role in this phenomenon. Born in the US, it has had an astonishing global expansion in just a few years. In fact, currently, it operates in 191 countries, homogeneously, that is to say, without trying to match the enormous differences between local legislation on tourism and real estate to major procedural and systemic differences. This service was born in 2007, but it is only since 2013 that, in Italy, its presence has become massive; until then, only a few hundred listings were published for the whole nation. Its development has thus been exponential, and as the projections confirm, in all likelihood, in the next decade it will maintain the same rate of growth. By now, it has already been several years that researchers and operators have highlighted the influence of Airbnb in the market of tourist accommodations. What is still poorly detailed, perhaps because of its low visibility and immediacy, is the relationship that this kind of short-term rental contract has with the traditional real estate market. Therefore, the intent of this study is to take the first step towards the comprehension of the impact that the uncontrolled growth of the sharing economy has, specifically, on the Italian real estate market. Logically, the rental submarket is the one that is affected the most by the growth of the sharing economy. In fact, compared to traditional rentals, contracts that are stipulated with Airbnb provide lessors with much higher revenues and much lower restrictions. That is one of the reasons that the Airbnb’s user base has experienced such an enormous expansion. However, this, has also led to the fear that these new dynamics are liable to distort the traditional real estate market.

Keywords

Sharing economy Airbnb Real estate 

References

  1. Austin, S. (2014). How does Airbnb´s $10 billion valuation size up? The Wall Street Journal. Accessed at: http://blogs.wsj.com/digits/2014/03/20/how-does-airbnbs-10-billion-valuation-size-up/. January 17, 2017.
  2. Bailetti, T. (2012). What technology startups must get right to globalize early and rapidly. Technology Innovation Management Review, 2, 5–16.Google Scholar
  3. Belk, R. (2014). You are what you can access: Sharing and collaborative consumption online. Journal of Business Research, 67(8), 1595–1600.CrossRefGoogle Scholar
  4. Botsman, R., & Rogers, R. (2010). What’s mine is yours: The rise of collaborative consumption. London: Collin.Google Scholar
  5. Carson, G. (2014). Five key sharing economy sectors could generate £9 billion of UK revenues by 2025. PwC. Accessed at: http://pwc.blogs.com/press_room/2014/08/five-key-sharing-economy-sectors-could-generate-9-billion-of-uk-revenues-by-2025.html. January 16, 2017.
  6. Ert, E., Fleischer, A., & Magen, N. (2016). Trust and reputation in the sharing economy: The role of personal photos in Airbnb. Tourism Management, 55, 62–73.CrossRefGoogle Scholar
  7. Federalberghi. (2016). Datatur—Trend e statistiche sull’economia del turismo. Roma: Edizioni ISTA.Google Scholar
  8. Gant, A. C. (2016). Holiday rentals: The new gentrification battlefront. Sociological Research Online. Accessed at: http://www.socresonline.org.uk/21/3/10.html. January 16, 2017.
  9. Hasan, R., & Birgach, M. (2016). Critical success factors behind the sustainability of the sharing economy. In 2016 IEEE 14th International Conference on Software Engineering Research, Management and Applications (SERA), Towson.Google Scholar
  10. Hill, D. (2015). How much is your spare room worth? IEEE Spectrum. Accessed at: http://spectrum.ieee.org/computing/software/the-secret-of-airbnbs-pricing-algorithm. January 16, 2017.
  11. Huet, E. (2014). New York Slams Airbnb, Says most of its rentals are illegal. Forbes. Accessed at: http://www.forbes.com/sites/ellenhuet/2014/10/16/new-york-slams-airbnb-says-most-of-its-rentals-are-illegal/#76c404c12613. January 17, 2017.
  12. Konrad, A., & Mac, R. (2014). Airbnb cofounfers to become first sharing economy billionaires as company nears $10 billion valuation. Forbes. Accessed at: http://www.forbes.com/sites/alexkonrad/2014/03/20/airbnb-cofounders-are-billionaires/. January 16, 2017.
  13. Lees, L., Shin, H. B., & Lopez-Morales, E. (2016). Planetary gentrification. Cambridge: Polity Press.Google Scholar
  14. Martin, C. J. (2016). The sharing economy: A pathway to sustainability or a nightmarish form of neoliberal capitalism? Ecological Economics, 121, 149–159.CrossRefGoogle Scholar
  15. Newcomer, E. (2015). Airbnb is in talks to raise funds at $24 billion valuation. Bloomberg Technology. Accessed at: https://www.bloomberg.com/news/articles/2015-06-18/airbnb-said-in-talks-toraise-funds-at-24-billion-valuation. January 17, 2017.
  16. Price, J. A. (1975). Sharing: The integration of Intimate Economies. Anthropologica, 17(1), 3–27.CrossRefGoogle Scholar
  17. PwC. (2014). The sharing economy: How will it disrupt your business Megatrends: The collisions? PwC. Accessed at: http://pwc.blogs.com/files/sharing-economy-final_0814.pdf. January 16, 2017.
  18. Sans, A. A., & Quaglieri, A. (2016). Unravelling Airbnb: Urban Perspectives from Barcelona. Reinventing the Local in Tourism: Producing, Consuming and Negotiating Place, 73, 209.Google Scholar
  19. Santana, J., & Parigi, P. (2015). Risk Aversion and Engagement in the Sharing Economy. Games, 6, 560–573.MathSciNetCrossRefGoogle Scholar
  20. Schofield, H. (2014). Short-let apartments spark Paris row as Airbnb thrives [Online]. BBC News, Paris. http://www.bbc.co.uk/news/world-europe-30580295.
  21. Shor, J. (2014). Debating the sharing economy. Great Transition Initiative. Accessed at: http://greattransition.org/publication/debating-the-sharing-economy. January 16, 2017.
  22. Spector, M., MacMillan, D., & Rusli, E. M. (2014). TPG-Led Group Closes $450 Million Investment in Airbnb. The Wall Street Journal. Accessed at: http://www.wsj.com/articles/SB100001424052702304626304579509800267341652. January 17, 2017.
  23. Varma, A., Jukic, N., Pestek, A., Shultz, C. J., & Nestrov, S. (2016). Airbnb: Exciting innovation or passing fad? Tourism Management Perspectives, 20, 228–237.CrossRefGoogle Scholar
  24. Zervas, G., Proserpio, D., & Byers, J. (2016). The Rise of the Sharing Economy: Estimating the Impact of Airbnb on the Hotel Industry. Boston U. School of Management Research Paper, (2013–16).Google Scholar

Copyright information

© Springer International Publishing AG, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Polytechnic of MilanMilanItaly

Personalised recommendations