According to a community advocacy group that studies the impact of vacation rentals, popular online vacation rental site Airbnb could make it harder and more expensive to find an apartment or house to rent in southern California. And, these community advocates say Airbnb rentals are also hurting the quality of life in some areas.
Consider the neighborhood around Troy Drive in the Hollywood Hills. When a group of eleven young Australians decided to visit Los Angeles, they wanted a big house where they could party. So they rented a house with a panoramic view on Troy Drive, via Airbnb.
And, on their first night on the town, they went wild in the garden with booze and music.
“You could hear it until 4 a.m.,” said Daisy Marco, who lives next door with her husband Mitch Gould. “It’s not a house where a small family goes, it’s the house where Aussies will go to party.”
The elderly owner of the home told NBC4 I-Team that she rented the house from a man named Barry Dadon, who said he was going to live there with his wife and baby.
But the I-Team discovered that Dadon had instead listed the house on Airbnb as a vacation rental, using the hostname “Alex.”
Mitch and Daisy have been calling LA police and the city for months about the issues with the Airbnb house. They were repeatedly woken up by Airbnb guests partying next door. They even saw a couple having sex in the garden in the middle of the day.
“It disrupts your sleep, it disrupts your sleep cycle, it affects your work,” Mitch Gould explained.
NBC4’s I-Team reveals what is becoming the nightmare next door for many: Short-term rentals are growing in popularity. It’s a convenient way for landlords to rent to tourists, who in turn avoid hotels. But it also means lost tax revenue for the city and frustration for some neighbors who are fed up with the constant turnover. Colleen Williams reports for…
In fact, the I-Team informed Airbnb three months ago of issues with the Troy Drive home, but Mitch and Daisy say nothing has changed.
“I think Airbnb is really irresponsible and they don’t seem to care about the community they affect,” Marco said.
And, short-term rental sites like Airbnb may not only affect the quality of life in some neighborhoods, but exacerbate the housing crisis in Los Angeles, according to community advocacy group Los Angeles Alliance for a New Economy, or LAANE.
“In neighborhoods with the highest concentration of Airbnb listings, rents are rising faster than in the rest of the city,” said Roy Samaan, a LAANE analyst who wrote the report.Airbnb, rising rents and the housing crisis in Los Angeles.”
LAANE puts some of the blame on people like Barry Dadon, whom they call “commercial hosts”. They say these individuals and businesses are listing several homes and apartments on short-term rental sites in popular neighborhoods that are already experiencing low vacancy rates and rising rents, such as Venice, Silver Lake and Hollywood.
KNBC TV This graphic shows Airbnb listings in several neighborhoods in Los Angeles.
“Landlords understand that they can make a lot more money listing a unit on the short-term rental market than they could rent to a long-term tenant. In some cases, two or three times as much” , Samaan said.
In “Alex’s” case, he not only lists the Troy Drive home on Airbnb, but he lists at least eight additional apartments, including two units in the luxurious 8th and Grand building in downtown Los Angeles. Many of these units are in buildings that prohibit tenants from subletting their apartments on short-term rental sites like Airbnb, such as 8th and Grand.
When the I-Team asked an agent from 8th and Grand Leasing if short-term rentals were allowed in the building, he replied, “No Airbnb’s allowed. Ever.”
So how did “Alex” manage to turn rented apartments into vacation rentals in buildings that prohibit subletting? We asked two I-Team researchers to book several Airbnb listings from “Alex” to find out.
In one instance, when we rented a unit at 8th and Grand, “Alex’s” assistant told our researcher to say she lived in the building if asked what she was doing on the property.
“You can just say you live in (apartment) 4131,” the assistant said.
Later, we booked a unit at La Belle Apartments in Hollywood through “Alex”, another building that prohibits Airbnb rentals. This time, his assistant led our researcher into the building through the garage, so residents wouldn’t see the Airbnb guest checking in.
“It’s just that some residents, they don’t really like it,” the assistant told our I-Team member.
We asked Airbnb spokesperson Connie Llanos if Airbnb is okay with a host listing units on Airbnb in buildings that don’t allow short-term rentals.
“We don’t get involved in issues between tenant and landlord. It’s between tenant and landlord,” Llanos said.
In a statement, Airbnb added, “If these properties do not allow short-term rentals, we believe it is the owner’s responsibility to enforce the rules.”
Aimco, one of the largest apartment building owners in the country, said Airbnb needed to get involved and help them enforce the rules.
The company, which owns the Palazzo near The Grove in Los Angeles’ Miracle Mile neighborhood, prohibits listing its units on short-term rental sites. Aimco said it has repeatedly asked Airbnb to remove listings for their units from the website. After their third request was ignored, Aimco filed a lawsuit in California state court.
In the lawsuit, Aimco alleged that Airbnb “continues to actively promote the unlawful rental of apartments” for vacation rentals. This lawsuit is still pending.
“Airbnb helps with the participation of our residents who break their tenancy with us,” said Didi Meredith, a spokesperson for Aimco. “We get noise complaints all the time, we have people coming in and out of apartments at all hours of the night.”
“These big hosts who get a lot of people in and out, they’re big money makers for the business,” Samaan said.
In a new TV ad, Airbnb says “home sharing is very important to families in Los Angeles.” And, they profile a South Los Angeles woman who explains that “without this income now, I couldn’t stay at home.”
But LAANE said the story Airbnb tells about helping families share homes to make ends meet isn’t the whole story.
“Most of their money comes from commercial hosts, large hosts who have multiple units in many buildings,” Samaan said.
LAANE says their analysis of Airbnb data shows that “commercial hosts” account for more than 40% of Airbnb’s overall revenue in Los Angeles.
Airbnb disputes LAANE’s findings and said its data and analysis are not accurate. They also point out that the data used by LAANE was not provided by the company.
The I-Team asked Airbnb for the full data in February to independently confirm LAANE’s findings, but the company has yet to provide all the information we requested.
Instead, Airbnb sent us their own report which revealed that the company has no impact on rental prices or availability when you look at the entire city of Los Angeles.
“Airbnb is only a tiny fraction of that housing stock,” said Connie Llanos, Airbnb spokesperson.
But what about individual neighborhoods? Could Airbnb be impacting certain high-density, low-vacancy areas?
“Maybe. But at a very low pace,” Llanos said.
LAANE said you should look at individual neighborhoods and not the city as a whole to understand the impact of short-term rental sites on the housing market.
The group’s analysis found that more than 1,300 whole units were available for rent in Venice on Airbnb in March. 966 units were available in Hollywood. And nearly 500 more have been listed in downtown Los Angeles.
“Taking additional units out of the market, removing additional units from circulation, will tend to increase prices,” Samaan said.
We wanted to know if Barry Dadon was concerned that the Airbnb business he operates under the name “Alex” is contributing to L.A.’s housing problems and impacting the quality of life in certain neighborhoods.
He refused to speak to us officially on a phone call and avoided our cameras when we approached him. He did not respond to the letter we sent to him via Fed-Ex.
The I-Team first informed Airbnb of the issues neighbors were having with the Hollywood Hills property in February. We repeated to them in May.
In a statement emailed to us on Wednesday, Airbnb told us, “When we become aware of hosting behavior that does not meet our standards and expectations, we strive to rectify the things and after careful consideration, we have permanently removed this host from our Platform.” And they tell us that they “have systems in place to prevent bad actors from returning to our platform.”
Airbnb added, “There have been over 160 million guest arrivals in Airbnb listings and the vast majority have been safe and positive experiences.”
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