Concerns about housing affordability have returned as more property owners cater to tourists rather than long-term residents, which corresponded with record growth in apartment rents in several of the largest U.S. urban areas.
Cities around the nation had tighter restrictions on where short-term rentals may exist before the epidemic in order to reduce interruptions from vacationing tenants. In the past two years, such regulatory initiatives have been given fresh life to address not only noisy vacationers but also the possibility that owners may be increasing housing and rent rates for long-term residents.
In the last two years, cities as large as Atlanta and as small as Steamboat Springs, Colorado, have passed regulations to gain some control over where short-term rentals can be operated while grappling with housing affordability concerns. Cities see the growing supply of short-term rentals as reducing the needed supply of long-term rentals, driving up rent prices for traditional leases.
According to AirDNA, the short-term rental tracking firm, listings on AirBnB and VRBO, the two largest short-term rental platforms, had grown to more than 663,000 across the 50 largest demand markets prior to the pandemic.
By February 2021, the epidemic had reduced the amount to just 418,057 listings. Such a decline indicates that the landlord either sold their properties, converted them to long-term rentals, or chose not to list them.
According to Grant Hammond, a real estate broker in Nashville, Tennessee, who specializes in selling recently constructed short-term rentals to investors, some owners switched to medium-term rentals during the pandemic's first year, defined as rentals lasting 30 days or more, to target traveling nurses.
These nurses "built up our stock at the time," according to Hammond, by filling staff posts at overcrowded hospitals early in the pandemic.
As the nation opened up, the number of rental listings grew as well, and as of right today, there are over 600,000 listings nationwide, according to AirDNA.
