Landlords dominate Airbnb listings and worsen rental crisis in holiday towns
Victoria’s Airbnb market has become dominated by profit-driven property investors who buy multiple homes in popular tourist towns and rent them out to short-term holidaymakers, depleting residents’ rental stocks in the process.
Airbnb’s creeping corporatization is worsening Victoria’s housing affordability crisis, especially in hotspots such as the Bass Coast and Mornington Peninsula, a new report says.
The report, which analyzed four years of Airbnb listing data, found that the short-term stay platform has departed from the original “sharing economy” model, where travelers stayed with a host or at an owner’s property while they were away.
Instead, most places listed on Airbnb are now owned by a host who rents multiple properties through the platform and does not live or stay there, often outsourcing management to a third party.
This changing trend is important because the increase in the number of unhosted short-term rentals offered on Airbnb is removing thousands of potential long-term rentals from the market.
In 2019, 55 per cent of short-stay properties listed on Airbnb across Australia were hosted by a resident. By 2023, this figure had dropped to 42 percent, with 58 percent of listed properties unhoused.
Monash University research fellow Dr. “There are now more listings for entire homes than for hosted rentals, which moves away from the original premise of platforms like Airbnb for property owners to host visitors in spare rooms,” said Michaela Lang.
Lang was the lead author of a report by the Australian Housing and Urban Research Institute that found Airbnb had transformed from a platform of hosts to ghosts.
The report stated that from 2019 to 2023, the number of homes hosted on Airbnb dropped by 32 percent, from 73,000 to 50,000, while the number of unhosted properties increased by 15 percent, from 60,000 to 69,000.
Nowhere is this trend more evident than on the Victoria coast.
The number of unhosted properties on the Mornington Peninsula has increased by 28 per cent from around 2,500 in 2019 to 3,300 in 2023, making the tourist region the Airbnb heart of the country.
The Bass Coast Shire, which includes short-stay hotspot Phillip Island, experienced a 30 per cent increase over the same four-year period, while listings in central Melbourne have fallen significantly, from 2600 in 2019 to less than 2000 in 2023.
Lang said the decline in Airbnb listings in the City of Melbourne was part of a national trend, with declines also occurring in Sydney and Brisbane, while the number of unhosted listings rose sharply in resorts such as the Whitsundays, Noosa and the Barossa Valley.
While all of these places have long had short-term rental accommodation, Airbnb’s emergence as a dominant platform in the market coincides with a worsening housing shortage, Lang said.
“Housing has become incredibly unaffordable and unusable in some of these towns,” he said. “Tourists can be great for your business, but some of these areas are reaching densities where it’s hard to staff because housing is so hard to find.”
Mornington Peninsula Shire Mayor Anthony Marsh said Airbnb was changing the holiday rental landscape in the area, with relatively modest beach houses being rented out by owners at an “absolute murder” rate.
“We get 8 million visitors a year… so there’s a degree of dependence on these holiday rentals. But Airbnb has transformed this from the little cottage that people could rent in Blairgowrie in a matter of weeks to something that has now become this fully commercial business model.”
Marsh said many properties could potentially provide affordable, long-term rental accommodation, but owners had calculated that it was more profitable to rent them for short-term stays.
“I’m thinking, Rye, if you go on Airbnb and look at some of the houses, I’m sure they’re probably pretty normal beach houses and they’re an absolute loss during the week. But if they’re on the rental market, that’s probably affordable, and I think that’s where it does the biggest damage,” he said.
The Victorian government introduced a 7.5 per cent tax on short-term accommodation bookings on January 1, arguing it would make more properties available for long-term rental.
According to the Parliamentary Budget Office, the tax is expected to generate $75 million in revenue in its first full year; All of this revenue will go to Homes Victoria, with 25 per cent going to regional areas.
Airbnb declined to comment when contacted by: Age. According to Airbnb data, the majority of hosts (85 percent) list only a single property on the platform.
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Adam Carey is senior urban reporter (suburban). He has held previous roles including education editor, state political correspondent and transportation reporter. He joined The Age in 2007.Connect with: excitement or email.
