NY_Airbnb_Policy

Airbnb, founded in 2008, has enabled guests to book private rooms, homes and apartments of hosts for short-term rental stays. As a new form of rental service, Airbnb has expanded to many local markets around the world while raising questions from residents and policymakers. Among all the controversies, the greatest concerns about Airbnb are its potential negative impacts on local housing availability and prices, local government tax returns, and the quality of life in residential neighborhoods. This report will conduct a data-driven research on these three questions and provide recommendations based on the analysis and results.

The rationales behind these three concerns are as follows. First, Airbnb is believed to reduce the availability of local housings, thus increasing the long-term housing price, because it encourages high- and middle- income groups to buy residences to rent them out. This increases demand for housing, causes prices to climb, profits people with more than one property, while prioritizing travelers over locals. Second, Airbnb reduces reliable lodging taxes for governments, because Airbnb not only contributes little in tax revenue but also cuts taxes from hotels by taking over their customers. Finally, Airbnb brings up concerns from local residents because short-term renters are more likely to create negative externalities.

This report aims to make recommendations on these three concerns, including the impact of Airbnb on local housing availability and prices, tax revenue, and the geographical distribution of Airbnb among local neighborhoods. The primary audiences that the report hopes to communicate with are policymakers in the New York City government. They could use the information from this project because it provides data-based evidences to support three policy decisions.

First, should the government regulate the number of listings that each host should own? This decision should be made based on the impact of Airbnb on local housing availability. If the data shows that 1) a large proportion of Airbnb hosts have more than one listing, 2) most listings are entire homes, and 3) the listings are available for most times of the year, then homeowners are believed to purchase housings purely for renting revenue. This will reduce the local housing availability and drive up housing price, which requires regulations from the local government. Second, if the government would impose taxes on Airbnb, how much tax revenue will generate from Airbnb based on different tax rates and boroughs? Third, this project will recommend the city government to release the geographical distribution map of Airbnb listings to the public.

The structure of this report is as follows. I will first provide the motivation and background of the problem areas. Then I will introduce the dataset used for this report. After that, I will break down the three problem areas into a number of sub-questions and answer them in turn. For each sub-question, I will describe its rationale, present the result, and provide corresponding analysis. For each problem area, I will synthesize the results of the sub-questions, discuss the final result, and analyze its implications. The sub-questions of each problem area are as follows.

• About impact on local housing availability and prices:

1. What percentage of listings are private rooms, entire homes and shared rooms?

2. What is the number of listings per host on average and its distribution?

   What is the number and percentage of hosts who have more than one listing?

3. What is the number of days available for booking on average and its distribution?

   What percentage of listings are available for more than 180 days (1/2 of the year)?

4. What is the average number of listings per host in each borough?

   What is the average number of days available per listing in each borough?

• About tax revenue:

1. How much tax revenue in total would a rental tax on New York City Airbnb generate annually based on different tax rates, for example, such as 5%, 7%, and 10%?
2. What is the average price and total number of reviews for each borough? How would the tax revenue vary with borough respectively with a 5%, 7%, and 10% tax rate?

• About geographical distribution:

1. What is the visualization of the geographical distribution of Airbnb listings on the New York City map, based on the provided longitude and latitude? What is the visualization of number of reviews and availability for each listing on the map?