Picture this: you and a few friends are looking to get away for a weekend and explore a new part of your city or state. You fumble through places to stay on Hotels.com, Kayak, and, eventually, Airbnb, granting you the option of booking an entire house for the same price as, or even less than, hotel room listings. You excitedly book an Airbnb in a neighborhood with a helpful, personable host and a prime location close to downtown, all implied by the listing’s abundance of five-star reviews. You exchange a friendly introductory message with the host, and you’re all set for your weekend. Easy, right?
This is a familiar scenario for many college students, young professionals, and families across the United States, and even the globe. Despite the harmlessness of enjoying a weekend getaway, the expansion and dominance of Airbnb’s platform in the short-term rental market have created conflicting impacts on neighborhoods, housing markets, and cities across the world. Snapshots of Airbnb growth in large cities have revealed an uneven distribution of listings among districts. One of the most notable cities affected by Airbnb’s business model is Los Angeles, a city especially known for its high foot traffic, wide disparities of socioeconomic backgrounds, and gentrification. The unequal distribution and expansion of Airbnbs across Los Angeles disrupt both short-term and long-term rental markets, pushing local residents out and obstreperously expanding tourism across the county.
Since Airbnb’s humble beginnings in 2008, the platform aimed to offer affordable short-term stays in a saturated market of expensive hotels. For many hosts, attractive revenue opportunities have drawn in wealthier people to certain districts, led to the “hotelization” of residential areas, and enabled a rise in gentrification (Lee 2016). As one of America’s least affordable rental housing markets, Los Angeles is a known hotspot for the hotelization of formerly residential homes and apartments to create more Airbnbs. While Airbnbs are “sharing the economy” with hotels and other short-term rental sites, the platform has disrupted the housing and hotel industry, made possible in part by its lack of governmental and zoning regulations, especially in residential districts. By using data provided by Inside Airbnb, we are seeking to better understand Airbnb’s patterns of high customer satisfaction and niche benefits to certain hosts at the potential cost of affordable housing and standard tourism markets in Los Angeles.
Research Questions & Approach
Our data comes from Inside Airbnb, whose creators sourced data from the original Airbnb website, granting us access to sets of information about Airbnbs across Los Angeles including:
- Listings
- Calendar information
- Guest reviews
- Summaries of listing metrics
Including over 30,000 Airbnb listings, the dataset offers us a snapshot of Airbnb listings from the past twelve years, allowing us to observe trends in the expansion of listings across Los Angeles in areas of varying socioeconomic status. By combining insights from the data set and outside scholarly sources, we found ourselves most interested in asking the following research questions:
-
Who is most hurt by Airbnb in Los Angeles? What effects has the expansion of Airbnb housing market and urban development?
-
Who benefits most from Airbnb? Why are some Airbnb hosts more successful than others, and what role do reviews play in
Airbnb's dominance of the short-term rental market?
Overall, we are investigating the increasing prevalence of Airbnbs over the past decade to explore the extent to which Airbnbs have exacerbated gentrification and negatively affected the rental and hospitality economy throughout L.A. County. Meanwhile, we are investigating how the unique, personable host-guest engagement on Airbnb’s platform affects guests’ expectations, the manner in which hosts interact with guests, and guest and host ratings.
Understanding this information will enable us to inform others about who profits from Airbnb rentals, and at what cost. We want to learn why and how Airbnb expanded in terms of the supply available and whether that may have benefitted hosts while harming Los Angeles residents. Moreover, gaining a better understanding of Airbnb’s unique approach to hospitality can help us find out why Airbnb reviews are so high relative to other booking sites, and how these high reviews may have triggered a more rapid growth of the platform. As a result, we are aiming to help others learn and acknowledge to what extent they should trust the Airbnb review system due to potential inflation or review bias and help them make better decisions for their future bookings, whether with Airbnbs or other booking sites.
