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Airbnb is making life hell for young renters in tourist hotspots

Second homes are driving up rent and house prices in areas like Cornwall – and forcing out young people in the process

It’s easy to think of ‘the housing crisis’ as something happening solely in cities like Manchester or London. It’s true that in recent months, rents have risen most in urban places like these; data published by Zoopla found that in 2022, rents rose by 15.6 per cent in Manchester and 17 per cent in London. But a separate crisis is brewing in smaller towns and cities in rural and coastal areas, largely thanks to the growth of Airbnb.

Matilda, 20, grew up in The Lizard in Cornwall, a popular tourist hotspot. She was raised in a single-parent household and recalls her mother struggling to get by on the paltry wages offered by seasonal work. “The summer months were OK, but in the winter it was very stressful,” she says.

Things took a turn for the worse four years ago, when Matilda and her mother were dealt a no-fault eviction. With skyrocketing rents thanks to the number of second homes in the area, it was impossible for them to find somewhere else to live. “We were homeless for a little while,” she says. They were then moved into a Housing Association in another village that was miles away from her mother’s job and their friends. “It was very isolating.”

“We were evicted at the end of the summer, so tourists had started going home, and half of the houses in the village were left empty because they were mostly second homes or Airbnbs,” she continues. “I remember walking around and looking at all of the empty houses and feeling so frustrated – there were so many houses but nowhere for us to live.” At present, there are around 20,000 households on the waiting list for social housing in Cornwall, and an estimated 1,677 people were recorded as homeless in the region in 2022. Meanwhile, there are around 20,688 properties available as holiday rentals in Cornwall, the majority of which are listed on Airbnb.

The short-term let company Airbnb launched in 2008 after roommates Brian Chesky and Joe Gebbia came up with the idea of putting a few air mattresses in the loft of their apartment and providing their guests with breakfast for a small fee. It was an idea designed to address shortages of hotel rooms during peak times, offer travellers a more economical alternative to expensive hotels, and “make a few bucks”, as Gebbia wrote to Chesky in the original email where he suggested the idea.

Today, the company is worth an estimated $72 billion dollars. It’s estimated that since its creation, nearly 1 billion people have used Airbnb. Roughly two million people sleep in an Airbnb property every night. There are six million listings worldwide, in over 100,000 cities. What started as a benign, sharing economy business, quickly snowballed into landlordism lite.

‘I remember walking around and looking at all of the empty houses and feeling so frustrated – there were so many houses but nowhere for us to live’ – Matilda

It’s easy to see how this happened – hosting is a lucrative business. According to research by Airbnb, the average UK host earns £6,000 a year from letting out properties or rooms via the company. An Airbnb host can earn in a weekend what a typical landlord would earn in a month. It’s also easier for Airbnb hosts to maintain ‘control’ over their properties: they can decline a reservation request for literally any reason, while private tenants do have some protections against discrimination from landlords. Holiday let landlords can also get a tax break via small business rates relief, but private landlords can’t.

Airbnb has made it easier for landlords to switch their properties from tenancies to serve the tourist market in holiday hotspots including London, Cornwall and the Lake District. This has reduced the number of homes available to live in and pushed up rents,” explains Dan Wilson Craw, acting director of Generation Rent, an activist group that has previously spoken out in favour of regulating the number of Airbnbs in the UK. “This is particularly bad for young people who want to stay near their families and the places they grew up, or work in the tourist economy and just can’t find anywhere to live at an affordable rent.”

As Craw says, second homes and holiday lets are stealing away more and more properties from the private rental market – for example, Cornwall has 20 times more properties available on Airbnb than it has for long-term rent – and this ‘shortage’ is driving up private rent prices. The average asking price for rents in Cornwall in March 2022 was £1,048 per month, a 26 per cent increase on the average level in 2019. It’s unsurprising the problem has been particularly exacerbated in recent years, after pandemic-related travel restrictions triggered a ‘staycation’ boom in tourist hotspots like Cornwall.

Like Matilda, 21-year-old Maia also lives in Cornwall. She recently had to move out of the house she rented with her fiancé in Padstow due to rising living costs. “We could no longer afford to live and pay our bills, even though we both work full time,” she says. “We’ve had to move into my mother-in-law’s house until we can find another, cheaper property to rent or get a mortgage, which at the moment is absolutely impossible unless we move out of Cornwall – or win the lottery.”

Maia says that many other young people in her town are in the same situation. “It breaks my heart,” she says. “The whole situation has been so difficult. Me and my fiancé were planning on getting married next year but we want to have our own home before becoming husband and wife.”

Bristol is another area suffering the consequences of the rise of holiday lets. According to Inside Airbnb, there are 2,329 Airbnb listings in Bristol – and, at time of writing, just 576 private rental properties listed on Zoopla. Harry*, 29, has experienced the impact of Airbnb on the city’s rental market firsthand. “Just before the pandemic, I lived in a three-bed flat that I found on SpareRoom. When one of the long-term tenants moved out, the landlord decided to change one of the rooms into an Airbnb.”

At first, Harry and his flatmate welcomed the news – the room wasn’t always occupied, so there was often more space in the property. But when Harry’s flatmate moved out at the start of the pandemic, his landlord converted the newly-vacant room into an Airbnb let too. “I was constantly having strangers coming in and out of my house,” Harry says, adding that this was hardly an ideal situation during the pandemic.

He doubts the guests who filtered through the flat even realised it was his long-term home. “They would come in and see my food in the kitchen, my stuff in the bathroom, and just use anything without asking,” he continues. “I can kind of understand why – they might have thought it was provided for them by the Airbnb host. I’m not averse to sharing food with housemates, but these were total strangers.”

Harry adds that he has recently been diagnosed as autistic, and in hindsight can see that this made it even harder to deal with the “constant stream” of activity in his home. “I like my routine, I like my space, and I like things to be a certain way,” he says. “There were at least 20 people in 30 days, or 20 people in two months… whatever it was, it was an obscene amount of people. It was horrid.”

‘I was constantly having strangers coming in and out of my house [...] They would come in and see my food in the kitchen, my stuff in the bathroom, and just use anything without asking’ – Harry

Some might argue that holiday lets are a necessary evil, as tourism benefits many of these local economies; it’s the biggest sector in Cornwall, for example, supporting one in five jobs. Maia says her job in a local pub relies on tourists: “As a business in Cornwall, you need the money, the people – we need it to survive,” she says. But equally, these aren’t ‘good’ jobs – much of Cornwall’s employment is low-paid and seasonal, and the area’s GDP is less than 70 per cent of the national average. In other words: is it worthwhile to be paid £11 an hour to sell ice creams for five months a year, when your rent is over £1,000 a month? What good is ‘tourism’ for Maia when her wages don’t even cover her living costs? Or for Matilda and her mother, when they were made homeless?

Long-term, the rise of Airbnb will only end up hurting the tourism industry too, by decimating its workforce as swathes of young people move away in search of more affordable housing. Matilda counts herself among these young Cornish locals moving away from the area. “I lived there for 18 years and used to work summer jobs in hospitality. I realised I was going to be stuck working in seasonal tourism-based work if I stayed there, so I knew I had to move,” she says. She now lives and works in London.

The government is attempting to address this crisis, and recently announced their plans to introduce a requirement for Airbnb hosts to seek planning permission to turn their properties into short-term lets. But are the plans sufficient? “It’s not bad, but it’s nowhere near enough,” Harry says. Craw agrees. “Proposals to require holiday lets to have planning permission are a step in the right direction, but it’s not clear if this will do anything to reverse the increase in holiday lets in recent years,” he explains. “It’s likely that existing holiday lets will get automatic permission and because it’s so lucrative to rent to holidaymakers, owners are unlikely to switch them back to residential.”

What is to be done, then? Craw suggests that a licensing system where councils can cap the number of holiday lets in certain areas would be a good idea, and also suggests cutting the tax breaks that holiday let landlords enjoy. Harry has his own ideas too. “Second homes need to be massively cracked down on. A lot more houses need to be built. And more landlords need to be, like, bullied into selling off their extra homes,” he suggests, smirking. “There are just so many more things that need to be done to make renting less hellish for young people.”

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