Landlords generated $500 million a year on Airbnb: Study
The study which was supported by American Hotel & Lodging Association found that multi-unit hosts, who operate two or more units, accounted for nearly 40 percent of Airbnb's total revenue for the year of $1.3 billion — or roughly $500 million in revenue.
Landlords operating illegal hotels are raking in big bucks on Airbnb, according to a new study, funded by the hotel-lodging industry.
The study found that multi-unit hosts, who operate two or more units, accounted for nearly 40 percent of Airbnb's total revenue for the year of $1.3 billion — or roughly $500 million in revenue.
The study, released Wednesday, was conducted by researchers at Penn State University's School of Hospitality Management, and the American Hotel & Lodging Association paid for the data. The association is a trade group and has been critical of Airbnb in the past. Airbnb disputes the research.
The study also found nearly one-third of Airbnb's $1.3 billion in revenues over a year, or $378 million, came from full-time operators renting out their units for 360 days per year in 12 of the nation's largest metro areas. Broken down individually, that amounted to $142,331 that each host earned using Airbnb.
The new data suggests a lot of activity on Airbnb centers around homes and properties that are owned by professional or commercial landlords, rather than individuals or families renting out their primary homes for short-term rentals.
"Unfortunately, this report shows a troubling trend as a growing number of residential properties are being rented out on a full-time, commercial basis, in what amounts to an illegal hotel," said Katherine Lugar, chief executive of the association. She went on to say that Airbnb is being used as a "platform for dodging taxes, skirting the law and flouting health and safety standards."
However, the San Francisco-based start-up disputed the study and said, "The overwhelming majority of Airbnb hosts are middle-class people who occasionally share the only home in which they live," said a spokesman in an email to CNBC. "This study shows the hotel industry gets what it pays for, which in this case is a specious study intended to mislead and manipulate."
According to the study, cities with the largest number of full-time operators are New York and Miami on the East Coast, and Los Angeles and San Francisco on the West Coast.
Full-time hosts make up a small percentage of operators in big cities, but account for a disproportionate amount of the revenue, according to the data. For example in New York, full-time hosts made up 3 percent of operators but accounted for 24 percent of revenue. In Miami, full-time hosts account for 7.3 percent of operators, but 61.3 percent of revenue.
The study analyzed New York, Chicago, Los Angeles, Philadelphia, Miami, Houston, Dallas, Phoenix, San Antonio, San Diego, San Francisco and Washington, D.C. The study used data from Airdna, which tracks Airbnb revenues and operations. The $1.3 billion in total revenue includes rental costs and fees.
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