As , Greater Hartford , faces an amazing demand for affordable housing and long-term accommodations, the great number of entries on , Airbnb , shows plenty of empty qualities or rentals available.
But according to experts, those Airbnb components are contributing to the declining supply of long-term accommodations.
A consumer affairs research from last year marked , Connecticut , as the worst position for homeowners. According to the report, a two-bedroom apartment’s median gross rental is$ 1,441 and has a 3.5 % vacancy rate. Many prospective sellers and landlords appear to be satisfied with Airbnb’s short-term advantages, which has more strained any desire for long-term rentals.
” If one takes a piece of house and converts it into an Airbnb, there’s one less house for sale, it’s one less room to get rented”, said , David Sacco, a , University of New Haven , teacher in the banking, finance, management and entrepreneurship program. The demand for housing and rental properties in this area hasn’t changed. In fact, it’s probably gone off in the last four years as individuals have pushed out of , New York City  , to areas like , Connecticut , to work at home. There’s probably more demand for housing ( in , Connecticut ) than there was four years ago”.
Sacco claimed that the rise in Airbnbs has resulted in fewer apartments and accommodation options as well as hotel contest. He claimed that supply and demand are key to real estate, and that Airbnb properties are removing offer from long-term rental industry.
” People are essentially turning their homes into short-term rentals, which means there is also less housing for price.” There is this new option for people to sell home they own that just didn’t exist five or ten years ago, Sacco said, which adds to the fact that you have a finite offer problem.
He said because of the demand, prices have gone up.
” The national real estate market is really scattered. There are many different regions, and each region has its own problems. You can find a swarm of housing and real estate anywhere in the Northeast thanks to the dense housing supply. Sacco said that there are essentially no places where new housing can be constructed, aside from where existing housing already exists. There is plenty of room to grow in other parts of the country. Places like , Connecticut , and most of the Northeast don’t have the ability to sprawl out like other areas.
Sacha Armstrong-Crockett, luxury real estate advisor with , William Pitt Sotheby’s International, said she is seeing a rise in small investors in , Hartford County.
” There’s an increased demand for rentals as buying a home becomes more challenging. Some markets are highly competitive, where, unfortunately, many people are either being priced out or repeatedly overlooked. According to Armstrong-Crockett, a reliable and stable rental market is necessary to meet the needs of those who can’t afford a home.
Any quick search on the , Airbnb platform , turns up dozens of listings for , Hartford , sites, from one room to entire homes. Prices vary widely, with some homes costing hundreds of dollars per night while others list for less than$ 50. Other items are listed weekly at higher prices. Additionally, there are numerous listings in nearby towns.
Armstrong-Crockett said the rise of Airbnb presents both benefits and challenges in , Hartford County.
” When it’s a small business or a source of supplemental income for families, it can positively contribute to a community,” she said.
” However, if it reaches the point when it reduces long-term rental options, it could affect local housing availability. As someone who works with investors and offers fair housing and first-time buyer workshops to renters, I understand both perspectives,” Armstrong-Crockett said”. Housing is a fundamental human right, but real estate is a financial product for property owners. Property owners who provide long-term, healthy and stable housing are important to any community.”
She said she is monitoring the historic , Linus B. Plimpton House , located at , 847 Asylum St.  , in , Hartford, which is being handled by Armstrong-Crockett’s colleague , Ellen Sebastian. The home was constructed in 1862.
” It’s a , NINA property, meaning it must be owner-occupied. The home also features two stunning apartments. It’ll be fascinating to see how things unfold. My hope is that it becomes a space for multigenerational living or that someone creates a truly unique, high-end rental opportunities for the , Hartford , community,” Armstrong-Crockett said.
NINA is , Northside Institutions Neighborhood Alliance, Inc.  , which is a , Hartford , non-profit that” rehabilitates blighted historic houses as owner-occupied opportunities for low-to-moderate-income households, “according to its website.
No place to build, really?
Rent control may not be the answer, but according to Sacco, there is “very little the government can do to help the supply and demand issue.”
” They can do what the government in , New York City  , has done for years and pose some form of rent price control,” Sacco said”. The problem with price control, which we see in , New York City  , in spades, is that price control, all that they do is exacerbate the shortage because there is not going to be more supply that is created. In fact, there will be less supply because prices are artificially low, and there will be less rent for existing properties, and there will be less improvement efforts to improve existing ones to make them more appealing to buyers.
” Anytime you implement price controls, you end up with more shortages than you did before, which doesn’t help the issue. It’s beneficial for some, but everyone else is priced out as a result,” Sacco said. There is no place to build, so you still have the same shortage, which only gets worse. In this case, the market must eventually reach an equilibrium. Where the growth is coming from is difficult to discern. Unfortunately, more people, including young people, may consider moving away from this area”.
” I know we tend to think that the exodus of people from the area we are living in for real estate prices is bad, but in reality, a lot of economic value is being created as well for those who can move and have more affordable housing and to those areas where real estate values start to go up as well,” Sacco said.
Changing markets
David Haberfeld, a , Bristol-based real estate investor and entrepreneur, runs , Haberfeld Enterprises , and said Airbnb is one of the contributing factors, but not a main reason, some buyers and renters are struggling to find housing or rent in the state.
According to Haberfeld,” People believe there is a crazy housing shortage because there isn’t any supply, but the supply is just not on the market.” ” It’s not listed, so there is a shortage, but not a real shortage of units. People believe that Airbnb is removing all of the apartments and that greedy landlords are to blame for the high prices, but that’s just not the case. They are contributing factors, but they are not the main drivers.
Higher interest rates and higher bank fees are other reasons why sellers aren’t putting their homes on the market, according to Haberfeld.
” Airbnbs are also necessary”, Haberfeld said. ” I’m a fan and I’m an operator. People who have a fire in their home and need a place to go are on Airbnb. Who wants to be the one to say you can’t have Airbnbs here so you have to leave our community, and you can’t stay here.
” Traveling nurses are another group, “he said”. Who wants to claim that traveling nurses are unable to visit our area because we forbid Airbnb and hotels are too expensive for them? Every community has a valid use for Airbnb, which is unquestionably a valid one.
According to Haberfeld, landlords are now letting out Airbnbs due to tenant/landlord laws. He switched to renting Airbnbs in , Bristol , during the eviction moratorium during the pandemic. He halted renting out his properties because he didn’t want to take the financial chance.
The reason is that landlords are switching to Airbnb because the government is abusing the landlords, Haberfeld said, and the tenant/landlord laws are so skewed and are so tenant friendly. declaring that the eviction moratorium requires them to live here for free. The Fair Rent Commissions are killing landlords.
If the government was going to stop using landlords and if someone is not making payments, he said, you could evict them as soon as possible. ” The , Fair Rent Commissions , are almost unnecessary in my opinion. Some of these short-term rentals will come back to the market. Not everyone wants to do short-term rentals, which require about four times as much work as long-term rentals. However, some people feel forced to do it.
Jacek Mikolajczyk, a realtor at , Berkshire Hathaway, suggests that many potential sellers are also using Airbnb while waiting for a better environment to sell.
” We are seeing a little bit of a slowdown”, Mikolajczyk said. ” Some of the homeowners are trying to survive and are renting until the mortgage rates drop so they can list their home once more and make the most money possible for themselves,” said one homeowner.
” In this market, there are not too many homes listed, “he added”. People assume they will pay the same amount as they did during COVID, but that is no longer the case and it’s difficult to let them negotiate lower, so they look into renting an Airbnb. As soon as the mortgage rates drop, more buyers will return and begin bidding once more. … My team sells more than 100 homes per year. We can see what is happening.
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