In a move that could drastically increase the supply of short-term rentals, Airbnb has announced the expansion its long-term rental marketplace to UK tenants. The development aims to provide buy-to-let landlords and tenants with a new way to benefit from Airbnb's platform while addressing concerns about housing affordability in major cities.
What is Airbnb-friendly housing?
The concept of Airbnb-friendly houses first launched in the US in 2022 in partnership with major rental companies like Greystar. It allows tenants to sub-let their homes part-time to earn additional income. Now, this model is being rolled out in London, with plans to expand across the UK.
Under the scheme, tenants will need to sign an agreement with their landlord, outlining hosting rules such as the number of nights they can sub-let their property. Landlords will share a portion of the revenue, typically between 10% and 25%, ensuring mutual benefits for both parties.
Why is this a game-changer?
Historically, tenancy agreements have prohibited sub-letting, which has prevented renters from earning extra income through platforms like Airbnb. By working closely with landlords to integrate hosting opportunities into rental agreements, Airbnb is creating a solution that benefits renters and landlords.
For tenants, especially those grappling with rising living costs, this offers a way to offset some expenses. For landlords, the partnership ensures properties remain primary residences while unlocking additional income streams. This balance may help Airbnb counter criticism that short-term rentals contribute to housing shortages and rising rents.
However, established short-term rental management companies may be concerned at the extra supply, while regulators will need to be satisfied that any long-term rental properties entering the market meet health and safety standards. Landlords will also need to ensure they have the correct insurance in place and may also need to ensure their mortgage is compliant with both long and short-term rentals.
The broader context
Airbnb’s push into long-term rentals comes amid a backdrop of increasing regulation in popular tourist destinations. Cities like Barcelona and Lisbon have imposed strict restrictions on short-term rentals, citing concerns about housing affordability for local residents. In contrast, this new scheme could present a sustainable alternative by ensuring properties are primarily used as homes while still allowing occasional short-term lets.
As Jesse Stein, Airbnb’s Global Head of Real Estate, noted: “It’s no secret that a lot of tenancy agreements say do not sub-let, so unfortunately, renters have had a challenge historically to become Airbnb hosts.” This initiative aims to resolve that challenge while addressing criticism that platforms like Airbnb inflate housing costs.
What’s next for the UK market?
Starting in London, the scheme will cover nearly 1,500 flats owned by Greystar, with Airbnb actively seeking partnerships with other landlords to expand the programme across the UK. This move opens the door for buy-to-let landlords to reimagine their properties’ earning potential while keeping them accessible to tenants.
For short-term rental investors and hosts, this shift may also signal a growing trend towards partnerships between major rental platforms and the long-term rental market – a development worth watching as the industry evolves.
A win for landlords and tenants
The introduction of Airbnb-friendly housing to the UK presents an exciting opportunity for buy-to-let landlords and tenants alike. By allowing renters to host part-time while maintaining affordable housing options, Airbnb’s new direction could pave the way for a more balanced and inclusive rental market. How it will affect businesses operating in the existing short-term rental space is anyone's guess.
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