Before COVID-19 gripped the world, people aspired to live and work in cities that offered them the finest options in culture, dining, entertainment and recreation. These attractions also brought in tourists, who frequently chose to stay in short term rentals (STRs) in nearby residential neighborhoods, such as those on Airbnb and HomeAway. Some property owners found that these short term rentals were more lucrative than renting to local residents on a long-term basis. Some even purchased or leased additional homes solely for the purpose of generating income through short term rentals.
According to many studies, short term rentals drive housing demand and rental costs upward. In one study, the Harvard Business Review linked one-fifth (20%) of the average annual increase in rents and about one-seventh (13%) of the average annual increase in housing prices in the U.S. to Airbnb-style short term rental listings.
However, other studies show a minimal impact on housing costs and demand. A survey of rental costs in Berlin (conducted by Airbnb), showed no significant increase, although that is arguably the result of very strict STR regulations in that city.
City planners who are trying to predict whether or not an increase in STRs will negatively affect housing affordability in their region should look at three variables:
- Is your municipality a tourist destination (or close to one)? More tourism equals more income for STR operators, and that will give them motivation to remove housing stock from the residential market.
- What percentage of housing appears to be for STR use versus long-term or owner-occupied? The higher the STR density percentage, the less housing is available for long-term renters or home buyers.
- Does the municipality have regulations restricting STR ownership? If a single owner, who may not even live nearby, can operate multiple STRs, the loss of available housing mentioned above is compounded.
Harmari has analyzed housing data across the country to illustrate some of the warning signs of housing stress. City planners need this information to predict trends and advocate for ordinances that protect housing affordability for their residents.
In the data tables below, Harmari has modeled a nationwide inventory of short term rental listings collected in November 2020 and compared that to the data obtained from the U.S. National Census records for 2019 for total housing units. Percentage vacancy rates are broken down by state and even by county. The results are truly interesting.
Top 10 States with Highest STR Inventories
| State Abbreviation | State Name | STR Listing Count | STR Pct. of Housing | Housing Pct. Rental Vacancy Rate | Difference between STR Pct. and Vacancy Pct. |
|---|---|---|---|---|---|
| FL | Florida | 379199 | 3.92% | 8.4% | 4.5% |
| CA | California | 297807 | 2.07% | 4.2% | 2.1% |
| TX | Texas | 121485 | 1.08% | 9.5% | 8.4% |
| NY | New York | 104221 | 1.24% | 5.2% | 4.0% |
| CO | Colorado | 100290 | 4.07% | 4.1% | 0.0% |
| NC | North Carolina | 74507 | 1.57% | 6.7% | 5.1% |
| AZ | Arizona | 63544 | 2.07% | 5.8% | 3.7% |
| GA | Georgia | 62304 | 1.42% | 7.6% | 6.2% |
| SC | South Carolina | 60960 | 2.59% | 10.8% | 8.2% |
By absolute numbers and as a percentage of total housing, it is not surprising that Florida and California lead the way based on population. But the outliers in this list are Hawaii, South Carolina and Colorado. This is likely due to a high number of secondary homes, given the seasonal destinations of those respective states.
But let’s look at this data a different way, sorting by highest STR density compared to total housing:
Top 10 States with Highest STR Density
| State Abbreviation | State Name | STR Listing Count | STR Pct. of Housing | Housing Pct. Rental Vacancy Rate | Difference between STR Pct. and Vacancy Pct. |
|---|---|---|---|---|---|
| HI | Hawaii | 60339 | 10.97% | 7.4% | -3.6% |
| VT | Vermont | 17188 | 5.06% | 4.4% | -0.7% |
| DC | District of Columbia | 13485 | 4.18% | 6.0% | 1.8% |
| CO | Colorado | 100290 | 4.07% | 4.1% | 0.0% |
| FL | Florida | 379199 | 3.92% | 8.4% | 4.5% |
| MT | Montana | 17338 | 3.33% | 5.0% | 1.7% |
| ME | Maine | 24301 | 3.24% | 4.1% | 0.9% |
| UT | Utah | 35582 | 3.14% | 3.8% | 0.7% |
| AK | Alaska | 9710 | 3.04% | 7.5% | 4.5% |
| SC | South Carolina | 60960 | 2.59% | 10.8% | 8.2% |
The 4 states in bold are on both Top 10 lists (by absolute STR count and by STRs as a percentage of total housing). Additional outliers also appear on this chart which were not on the last one, based on relative proportion of total housing. This is even more concerning to those in Vermont, D.C., Montana and Maine, which head this list, because they already have a low housing supply. These remote regions have also seen an influx of people escaping from high-density regions prone to the spread of COVID-19.
When you compare these numbers to the same Census values for Rental Vacancy Rates, the alarms start to sound for these remote states. It doesn’t take a rocket scientist to conclude that once the STR density percentage equals or exceeds the rental vacancy percentage, tenants are losing housing to tourists. The big states are on this list, but the smallest of the states are on there, too.
Short Term Rental Inventory as a Percentage of Housing Relative to Rental Vacancy Rate
| State Abbreviation | State Name | STR Listing Count | STR Pct. of Housing | Housing Pct. Rental Vacancy Rate | Difference between STR Pct. and Vacancy Pct. |
|---|---|---|---|---|---|
| HI | Hawaii | 60339 | 10.97% | 7.4% | -3.6% |
| VT | Vermont | 17188 | 5.06% | 4.4% | -0.7% |
| CO | Colorado | 100290 | 4.07% | 4.1% | 0.0% |
| UT | Utah | 35582 | 3.14% | 3.8% | 0.7% |
| ME | Maine | 24301 | 3.24% | 4.1% | 0.9% |
| MT | Montana | 17338 | 3.33% | 5.0% | 1.7% |
| DC | District of Columbia | 13485 | 4.18% | 6.0% | 1.8% |
| MA | Massachusetts | 49827 | 1.70% | 3.6% | 1.9% |
| NH | New Hampshire | 13254 | 2.06% | 4.0% | 1.9% |
| CA | California | 297807 | 2.07% | 4.2% | 2.1% |
| ID | Idaho | 17584 | 2.34% | 4.5% | 2.2% |
| RI | Rhode Island | 7235 | 1.54% | 3.9% | 2.4% |
| OR | Oregon | 44483 | 2.46% | 5.1% | 2.6% |
| WA | Washington | 42445 | 1.33% | 4.1% | 2.8% |
| NJ | New Jersey | 35734 | 0.98% | 4.2% | 3.2% |
| NV | Nevada | 28429 | 2.21% | 5.8% | 3.6% |
| AZ | Arizona | 63544 | 2.07% | 5.8% | 3.7% |
| NY | New York | 104221 | 1.24% | 5.2% | 4.0% |
| WI | Wisconsin | 21943 | 0.81% | 4.8% | 4.0% |
| MN | Minnesota | 13444 | 0.54% | 5.0% | 4.5% |
| AK | Alaska | 9710 | 3.04% | 7.5% | 4.5% |
| FL | Florida | 379199 | 3.92% | 8.4% | 4.5% |
| DE | Delaware | 6379 | 1.44% | 6.3% | 4.9% |
| CT | Connecticut | 7427 | 0.49% | 5.6% | 5.1% |
| NC | North Carolina | 74507 | 1.57% | 6.7% | 5.1% |
| WV | West Virginia | 5439 | 0.61% | 5.8% | 5.2% |
| NM | New Mexico | 17960 | 1.89% | 7.1% | 5.2% |
| WY | Wyoming | 6114 | 2.18% | 8.1% | 5.9% |
| OH | Ohio | 18228 | 0.35% | 6.4% | 6.1% |
| VA | Virginia | 33544 | 0.94% | 7.0% | 6.1% |
| MI | Michigan | 33895 | 0.73% | 6.8% | 6.1% |
| NE | Nebraska | 2767 | 0.33% | 6.5% | 6.2% |
| GA | Georgia | 62304 | 1.42% | 7.6% | 6.2% |
| IN | Indiana | 12121 | 0.41% | 6.7% | 6.3% |
| IA | Iowa | 4503 | 0.32% | 6.7% | 6.4% |
| PA | Pennsylvania | 35832 | 0.63% | 7.2% | 6.6% |
| IL | Illinois | 21730 | 0.40% | 7.5% | 7.1% |
| MD | Maryland | 24227 | 0.98% | 8.1% | 7.1% |
| KY | Kentucky | 11016 | 0.55% | 8.5% | 8.0% |
| SC | South Carolina | 60960 | 2.59% | 10.8% | 8.2% |
| MS | Mississippi | 6133 | 0.46% | 8.7% | 8.2% |
| SD | South Dakota | 4700 | 1.17% | 9.5% | 8.3% |
| TX | Texas | 121485 | 1.08% | 9.5% | 8.4% |
| MO | Missouri | 23514 | 0.83% | 9.3% | 8.5% |
| TN | Tennessee | 46898 | 1.55% | 10.1% | 8.6% |
| AR | Arkansas | 11888 | 0.86% | 9.6% | 8.7% |
| OK | Oklahoma | 9534 | 0.54% | 10.0% | 9.5% |
| LA | Louisiana | 18959 | 0.91% | 10.7% | 9.8% |
| ND | North Dakota | 1323 | 0.35% | 11.6% | 11.3% |
| KS | Kansas | 4499 | 0.35% | 11.8% | 11.5% |
| AL | Alabama | 14799 | 0.65% | 12.6% | 12.0% |
Below is a breakdown county-by-county for California, Colorado, and Florida. The numbers point to a strong connection between high tourism and reduced housing availability, and in some cases the percentage density of STRs to total housing units spikes up to 50%!
California Short Term Rentals and Housing Affordability
California has a strong four-season tourism economy within its own state, with over 840 miles of Pacific coastline and skiing destinations in the Sierra Nevada mountains within a 2 hour drive for most residents. Below is a table broken down County-by-County within California of short term rentals as a percentage of total housing:
California Short Term Rental Inventory by County and as Percentage of Housing
| County | STR Listing Count | STR Pct. of Housing |
|---|---|---|
| Mono County | 5425 | 38.2% |
| Alpine County | 345 | 19.4% |
| Mariposa County | 1316 | 12.6% |
| Nevada County | 3353 | 6.1% |
| El Dorado County | 5567 | 6.1% |
| Calaveras County | 1249 | 4.4% |
| Placer County | 7436 | 4.4% |
| Tuolumne County | 1334 | 4.2% |
| San Luis Obispo County | 5090 | 4.1% |
| Mendocino County | 1420 | 3.5% |
| Del Norte County | 337 | 2.9% |
| Riverside County | 24583 | 2.9% |
| Plumas County | 456 | 2.9% |
| Napa County | 1478 | 2.7% |
| Sonoma County | 5430 | 2.6% |
| Madera County | 1256 | 2.4% |
| Santa Cruz County | 2545 | 2.4% |
| Sierra County | 53 | 2.2% |
| San Francisco County | 9006 | 2.2% |
| Siskiyou County | 535 | 2.2% |
| San Diego County | 27206 | 2.2% |
| Marin County | 2458 | 2.2% |
| Humboldt County | 1357 | 2.1% |
| Santa Barbara County | 3299 | 2.1% |
| Monterey County | 2750 | 1.9% |
| Inyo County | 181 | 1.9% |
| Trinity County | 165 | 1.8% |
| Lake County | 606 | 1.8% |
| San Mateo County | 4855 | 1.7% |
| San Bernardino County | 11651 | 1.6% |
| Santa Clara County | 9077 | 1.3% |
| Orange County | 14648 | 1.3% |
| Los Angeles County | 46541 | 1.3% |
| Shasta County | 963 | 1.2% |
| Alameda County | 6779 | 1.1% |
| Amador County | 170 | 0.9% |
| Ventura County | 2210 | 0.8% |
| Tulare County | 974 | 0.6% |
| Butte County | 532 | 0.6% |
| Contra Costa County | 2167 | 0.5% |
| Yolo County | 403 | 0.5% |
| Solano County | 754 | 0.5% |
| Fresno County | 1575 | 0.5% |
| San Benito County | 91 | 0.5% |
| Modoc County | 23 | 0.4% |
| Lassen County | 55 | 0.4% |
| Sacramento County | 2339 | 0.4% |
| Kern County | 1214 | 0.4% |
| Tehama County | 84 | 0.3% |
| San Joaquin County | 585 | 0.2% |
| Stanislaus County | 377 | 0.2% |
| Yuba County | 57 | 0.2% |
| Merced County | 161 | 0.2% |
| Imperial County | 106 | 0.2% |
| Colusa County | 14 | 0.2% |
| Sutter County | 44 | 0.1% |
| Kings County | 59 | 0.1% |
| Glenn County | 8 | 0.1% |
Mono County surrounds the Town of Mammoth Lakes, a very popular ski destination within a 2-hour drive of the Los Angeles metro area. Alpine County has three large ski resorts within an hour’s drive of Sacramento, and Mariposa County is on the doorstep of Yosemite National Park. These regions have less commercialized accommodations for tourists, and short term rentals have filled that demand.
Colorado Short Term Rentals and Housing Affordability
Colorado has historically been a winter tourist destination, but many cities have witnessed a recent economic and industrial revival, recovering from the corporate oil exodus of the 1980s. Below is a table, broken down County-by-County within Colorado, of short term rentals as a percentage of total housing:
Colorado Short Term Rental Inventory by County and as Percentage of Housing
| County | STR Listing Count | STR Pct. of Housing |
|---|---|---|
| Summit County | 17996 | 56.1% |
| San Miguel County | 2984 | 42.7% |
| Routt County | 6568 | 38.4% |
| San Juan County | 232 | 29.3% |
| Pitkin County | 4060 | 28.5% |
| Grand County | 4801 | 28.0% |
| Eagle County | 8278 | 25.0% |
| Ouray County | 634 | 18.7% |
| Gunnison County | 2074 | 17.0% |
| Archuleta County | 1564 | 16.1% |
| Hinsdale County | 161 | 11.2% |
| Lake County | 467 | 10.4% |
| Mineral County | 132 | 10.1% |
| Chaffee County | 842 | 7.3% |
| Clear Creek County | 393 | 6.7% |
| La Plata County | 1872 | 6.5% |
| Rio Grande County | 405 | 5.9% |
| Park County | 866 | 5.8% |
| Teller County | 752 | 5.6% |
| Saguache County | 157 | 3.6% |
| Gilpin County | 122 | 3.2% |
| Jackson County | 40 | 3.0% |
| Custer County | 132 | 2.9% |
| Garfield County | 711 | 2.9% |
| Larimer County | 3586 | 2.3% |
| Montezuma County | 264 | 2.1% |
| Boulder County | 2432 | 1.7% |
| Delta County | 257 | 1.7% |
| Rio Blanco County | 56 | 1.6% |
| Huerfano County | 83 | 1.6% |
| Denver County | 5132 | 1.5% |
| Dolores County | 25 | 1.4% |
| El Paso County | 3772 | 1.3% |
| Mesa County | 894 | 1.3% |
| Las Animas County | 113 | 1.3% |
| Alamosa County | 85 | 1.2% |
| Costilla County | 30 | 1.0% |
| Montrose County | 188 | 1.0% |
| Fremont County | 191 | 1.0% |
| Jefferson County | 1692 | 0.7% |
| Lincoln County | 16 | 0.6% |
| Conejos County | 28 | 0.6% |
| Kit Carson County | 21 | 0.6% |
| Adams County | 947 | 0.5% |
| Arapahoe County | 1322 | 0.5% |
| Moffat County | 24 | 0.4% |
| Pueblo County | 257 | 0.4% |
| Douglas County | 470 | 0.4% |
| Otero County | 26 | 0.3% |
| Prowers County | 17 | 0.3% |
| Logan County | 24 | 0.3% |
| Weld County | 296 | 0.3% |
| Crowley County | 3 | 0.2% |
| Baca County | 4 | 0.2% |
| Washington County | 4 | 0.2% |
| Elbert County | 16 | 0.2% |
| Bent County | 3 | 0.1% |
| Morgan County | 12 | 0.1% |
| Yuma County | 4 | 0.1% |
| Broomfield County | 9 | 0.0% |
Topping the list is Summit County, which contains Keystone, Breckenridge and other prime skiing and mountain destinations. San Miguel County contains Mountain Village and Telluride, also great choices on the Western Slope. Routt County contains Steamboat Springs, a phenomenal skiing destination. Note that these counties have less commercialized property such as hotels and resorts compared to the more well-known regions of Aspen (Pitkin County) and Vail (Eagle County). Therefore, they do have a higher proportion of alternative short term rental accommodations to meet the demands of the tourism market.
Florida Short Term Rentals and Housing Affordability
The classic Suncoast state of Florida has always been a tourist destination, but it is also home to a huge economy driven by agriculture, shipping, and aerospace. Below is a table broken down County-by-County within Florida of short term rentals as a percentage of total housing:
Florida Short Term Rental Inventory by County and as Percentage of Housing
| County | STR Listing Count | STR Pct. of Housing |
|---|---|---|
| Walton County | 15616 | 28.5% |
| Osceola County | 33811 | 20.8% |
| Monroe County | 9825 | 18.2% |
| Okaloosa County | 15784 | 16.0% |
| Bay County | 16174 | 15.4% |
| Franklin County | 1346 | 15.2% |
| Gulf County | 1225 | 12.6% |
| Saint Johns County | 5694 | 4.9% |
| Lee County | 19684 | 4.8% |
| Polk County | 13349 | 4.4% |
| Manatee County | 8621 | 4.3% |
| Nassau County | 1757 | 4.3% |
| Collier County | 9350 | 4.2% |
| Escambia County | 5834 | 4.1% |
| Sarasota County | 9809 | 3.9% |
| Charlotte County | 3488 | 3.3% |
| Pinellas County | 16413 | 3.2% |
| Volusia County | 7494 | 2.8% |
| Flagler County | 1426 | 2.6% |
| Broward County | 19376 | 2.3% |
| Santa Rosa County | 1607 | 2.2% |
| Taylor County | 239 | 2.1% |
| Lake County | 3420 | 2.1% |
| Miami-Dade County | 18476 | 1.8% |
| Dixie County | 155 | 1.6% |
| Orange County | 8841 | 1.6% |
| Brevard County | 4443 | 1.6% |
| Citrus County | 1246 | 1.5% |
| Sumter County | 943 | 1.3% |
| Levy County | 263 | 1.3% |
| Martin County | 930 | 1.2% |
| Saint Lucie County | 1538 | 1.1% |
| Indian River County | 844 | 1.0% |
| Jefferson County | 64 | 0.9% |
| Wakulla County | 113 | 0.8% |
| Lafayette County | 27 | 0.8% |
| Leon County | 1037 | 0.8% |
| Alachua County | 928 | 0.8% |
| Hillsborough County | 4202 | 0.7% |
| Duval County | 2671 | 0.6% |
| Hernando County | 557 | 0.6% |
| Columbia County | 176 | 0.6% |
| Gilchrist County | 46 | 0.6% |
| Palm Beach County | 4058 | 0.6% |
| Highlands County | 292 | 0.5% |
| Suwannee County | 97 | 0.5% |
| Putnam County | 186 | 0.5% |
| Marion County | 846 | 0.5% |
| Seminole County | 893 | 0.5% |
| Pasco County | 953 | 0.4% |
| Okeechobee County | 66 | 0.4% |
| Glades County | 25 | 0.4% |
| Hamilton County | 15 | 0.3% |
| Clay County | 179 | 0.2% |
| Jackson County | 38 | 0.2% |
| Madison County | 14 | 0.2% |
| Hendry County | 24 | 0.2% |
| Liberty County | 5 | 0.1% |
| DeSoto County | 21 | 0.1% |
| Calhoun County | 8 | 0.1% |
| Gadsden County | 29 | 0.1% |
| Washington County | 13 | 0.1% |
| Bradford County | 12 | 0.1% |
| Union County | 5 | 0.1% |
| Hardee County | 7 | 0.1% |
| Baker County | 2 | 0.0% |
| Holmes County | 1 | 0.0% |
Topping this list is Walton County, which has Miramar Beach, Grayton Beach, and Rosemary Beach. Osceola County includes Kissimmee, Four Corners, and St. Cloud, and it is close to attractions like Walt Disney World, Universal Studios, and the Orlando metro area. Monroe County is the 108 mile long stretch of the Florida Keys including cities Marathon and Key West. Okaloosa County contains Destin, Fort Walton Beach and Santa Rosa Island. Except for Osceola County, many of these counties have fewer commercialized accommodations like hotels and resorts. This drives up demand for short term rental accommodations.
City planners need to take inventory of the risk factors in their municipalities that could lead to STRs negatively affecting housing affordability. With carefully planned and enforced ordinances, any region can enjoy the income from tourism without sacrificing quality of life for its residents.
Contact Us to learn more about Harmari STR helps protect housing stock for your community.
Error sources:
- Variability in STR inventory, and urban / remote housing supply/demand throughout the COVID-19 pandemic of +/- 25%, discussed here
- Listing exceed dwelling unit inventories by 10-30% due to duplicates between and within platform
References:
- Census.gov total housing units by state and county
- Census.gov rental vacancy rates by state
- Wikipedia population rankings