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AirBnB in Houston

When people talk about “the sharing economy” for good or ill, the main players that get named tend to be Uber, Lyft, and AirBnB. We’ve heard a lot about the first two in Houston lately, but prior to this Chron story I can’t say I’d heard anything about the latter.

Airbnb launched in 2009 as a way for those with extra space to connect with travelers looking for an alternative to traditional hotels, in the same way that Uber and Lyft help people turn their cars into temporary taxis. In November 2013 Airbnb chief technology officer Nate Blecharczyk reported that more than 9 million users, or “guests,” have now stayed in AirBnb rentals, up exponentially from the 4 million bookings that the start-up recorded in its first four years of business.

“I had a roommate, and when she moved out instead of going through the whole process of finding a new roommate, I had extra furniture so I thought I would give it a shot,” said Crystal Lee, who has been renting a room in her Montrose house on Airbnb since 2012.

“Everything is yours, so I think people are a lot more respectful of that,” she said. “With roommates, people get used to leaving their stuff everywhere and not caring. When you have a house guest, people tend to be polite. It’s kind of fun to play tour guide and tell people where to go and what to do.”

[…]

Airbnb is most popular in cities that attract a lot of tourism and where hotel prices and rents are high. Austin, with less than half of the population of Houston, boasts nine times the number of Airbnb properties that Houston lists. That’s partly because downtown Austin has only 6,000 hotel rooms, not nearly enough for major events like Austin City Limits and South by Southwest. The fact that Airbnb has made a major push for publicity at recent SXSW festivals – including a promotional park featuring live music and display rooms designed by musicians like Snoop Dogg – could also be a factor.

Houston, on the other hand, has nearly 75,000 hotel rooms in the metropolitan area. According to tourism data compiled by the Greater Houston Convention and Visitors Bureau, a higher than average percentage of visitors are here visiting family or on a business trip, implying that they already have a place to stay or that hotel price is not of primary concern.

Houston is also one of only two cities in the U.S. where the average hotel rate per night is lower than renting out an entire house or apartment on Airbnb, according to the website Priceonomics. (The other city is Las Vegas.)

Cheap, plentiful hotel rooms haven’t made a dent in the demand for Airbnb hosts though. Anderson says her property is booked about 75 percent of the time, and Wright, who only makes her house available on weekends when she is heading to family homes in Tiki Island or La Grange, says she turns down more offers than she accepts. The process has been so successful for Lee that when her job relocated her to New York earlier this year, she kept her Houston house and still rents out the extra room.

While Houston might be lacking in traditional tourists, many Airbnb guests are people who are planning to move to the city and want to get a feel for the different neighborhoods. Others, particularly international travelers, stop in Houston while on cross-country trips as a break between the frenetic nightlife of New Orleans and Austin. Internships, job interviews, weddings and family visits are also commonly cited reasons for a Houston Airbnb stay.

It’s an interesting contrast with Austin. I know several people who have made an envy-inducing amount of money renting their homes via AirBnB for South by Southwest. I suppose the difference between “normal” level of demand for hotel space in Austin and the peak level that happens when SxSW is happening is such that AirBnB makes a lot of sense to fill the gap. I seem to recall there being a few stories about people leasing their homes for outrageous amounts in Houston during the last Super Bowl for similar reasons. I get why people have concerns about the effect of companies like Uber and Lyft on employment opportunities in the industry they’re entering. I think those concerns are valid even as I support allowing Uber and Lyft into currently regulated vehicle for hire markets. I don’t see the same concerns about AirBnB, however. There’s no barrier to entry in the hotel market like there has been in many cities in the taxi market, and there’s no general complaint about the way the hotel business is run like there is for taxis. A ride is a ride, but there’s a vast difference between a Motel Six room and one at the Ritz Carlton, or a traditional bed and breakfast and a resort hotel like the Hyatt Lost Pines. Uber and Lyft could conceivably upend the existing taxi industry, but I don’t see AirBnB as being anything more than a niche. What do you think?

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One Comment

  1. Andrea says:

    I have the same quibble calling AirBnB the sharing economy as I do calling Uber & Lyft that. If you are getting paid, it isn’t sharing.

    There’s also the question of decreasing HOT revenues if fewer people use hotels. This could be fixed easily enough by requiring services like AirBnB to collect the hotel tax. Now, I don’t think we’re suddenly going to see hotel occupancy tax revenue reduced by half, but at a certain point, we have to decide how we want to pay for the collective good (provide for the common defense, promote the general welfare, and secure the blessings of liberty, as it were) if we’re going to find loopholes for every tax.

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