Price competition among short-term Airbnb listings in New York City following Local Law 18

ABSTRACT

In September 2023, New York City began requiring short-term rental properties to be licenced, wiping off many listings from platforms like Airbnb. The increase in short-term rental rates observed soon after illustrates price rivalry under an exogenous shock to market structure. To quantify that effect, we use data on New York’s Airbnb listings from July 2023 to January 2024 to carry out several fixed-effect regressions. We found that the intensity of price competition is hindered by the presence of multi-listing hosts. Hence, if Airbnb wishes to reclaim its ‘cheaper than hotels’ value proposition, they should tackle excessive market concentration.

KEYWORDS:

• Airbnb; short-term rentals
• regulations
• fixed-effects regression

Disclosure statement

No potential conflict of interest was reported by the author(s).