Average Airbnb listing in London ‘more expensive than hotels’

Online spare room rental service Airbnb has rapidly acquired a ‘significant’ chunk of the London accommodations market and is increasingly charging higher rates than hotels, according to new research.

Airbnb – which recently made headlines by creating a buoyant guesthouse which was found floating on London’s River Thames – has had an even bigger impact London’s accommodations market, having amassed an 8 per cent chunk since launching in 2008.

Analysis by STR Global has also found that – despite being seen by many as the more affordable option – typical Airbnb listings are now more expensive than the average daily hotel rate in every London borough except Westminster, Lambeth and Hackney.

As of last month, Inside Airbnb listed 25,361 Airbnb units in London, 52.6 per cent of which were entire home/apartment units. The remaining Airbnb inventory in the market comprised 45.8 per cent private room and 1.6 per cent shared room.

The majority of hotel rooms and Airbnb listings fall in the £100 to £199 price range with 45,000 hotel rooms (46 per cent of all hotel rooms) and 5,800 Airbnb listings (52 per cent of all Airbnb listings). However, Airbnb’s largest share of total accommodations falls in the £300 to £399 price range with 12 per cent of all listings/rooms.

Analysts said that one of the main drivers of Airbnb’s rapid growth has been the ease with which new listings can enter the market.

“Across Europe, alternative accommodations are not a new phenomenon; pensions, pub accommodation, hostels and family stays have long existed,” said Elizabeth Winkle, STR Global’s managing director.

“What has changed is the distribution platform providing an accommodation owner the means to easily and seamlessly list and let their property (or properties) connect to guests. Airbnb is one of the most recognisable of these ‘peer-to-peer’ or ‘rental-by-owner’ companies, and its inventory continues to increase across the globe.”

To read an interview with Airbnb co-founder Nathan Blecharczyk, from the Q1 2014 edition of Leisure Management magazine, click here.