Here's how huge Airbnb has become in Sydney

A crowd in Sydney gathering for New Year celebrations. Picture: Getty Images / File

A new Deloitte Access Economics report into the sharing economy in New South Wales has offered an insight into the massive growth of the short-term accommodation market in the state, with Sydney becoming one of the top 5 markets in the world for Airbnb.

Deloitte’s Developments in the Collaborative Economy in NSW report says Sydney jumped from 10th in the global rankings in 2015 to 5th in 2016, with 4,500 listings in the city – more than San Francisco, where Airbnb was founded.

The numbers suggest the business, which is generally wary of releasing details about its impact in the local market, may already be worth multiple billions of dollars in Australia, with BIS Shrapnel estimating in 2013 that 2,205 Australian listings generated $214 million in economic activity.

The number of properties listed in NSW more than doubled in 12 months, from 16,200 in 2015, to 38,000 properties in 2016. Sydney listings have doubled annually over the last five years to more than 15,600 12 months ago in January 2016.

There are now more than 60,000 listings nationwide, which means NSW represents around half the total Australian market.

Airbnb co-founders, left-to-right: Nathan Blecharczyk, Brian Chesky and Joe Gebbia.

Nearly a third of properties (62%) are offered in their entirety, while 37% list a private space or room in the home, and less than 1% have a shared space.

The average annual income for Sydney host is now $4,700, based on an average of 28 nights rented per year.

But the impact of Airbnb on Sydney’s rental market has become an increasing concern in the city’s rental market pushing up prices and driving out permanent renters.

In research published in the Journal of the American Planning Association in January, academics from the University of Sydney found that nearly a third of Airbnb listings in greater Sydney are by people with multiple properties, delivering $600 more monthly in income than permanent rentals. The rental income is equivalent to 10-19% of median rents and mortgages. The study found only a small portion of the population benefits from Airbnb income.

Professor Nicole Gurran, from the university’s School of Architecture, Design and Planning, said that at the time of the research, a total of 1,268 properties were available on Airbnb in Sydney, which is equivalent to 144% of the city’s vacant rentals.

In suburbs such as Waverley, Airbnb listings made up more than three times the suburb’s vacancy rate. In inner west suburbs such as Leichhardt and Marrickville, the figures were 69% and 44% of available rentals, respectively.

“While it is recognised that not all forms of online homesharing have had a serious impact since 2011, it is clear that providers like Airbnb are not helping the affordability problem facing many Australians on low incomes,” Professor Gurran said.

Research collaborator Professor Peter Phibbs said their research indicated tighter zoning and residential development controls are needed to distinguish between the different forms of short-stay accommodation to reduce the impact on local communities and residents.

“Current land use planning controls cannot regulate these new forms of visitor accommodation by Airbnb and others,” he said.

Last year, Airbnb said there were 262,000 inbound guests to Sydney, representing 106% year-on-year growth.

An 18-month parliamentary inquiry into short-term rental accommodation wound up late last year and recommended home owners be allowed to let out spare rooms for cash via the likes of Airbnb. The government is due to respond by mid-2017.

The Deloitte report said Airbnb competitor Stayz, owned by US-based Expedia, has been growing at an average rate of 20% per year.

The Deloitte study was an annual review of the state’s sharing economy commissioned by the NSW government.

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