It has been a tough year for those working in short-term housing: it is not enough for both the government and the capital to restrict the market, the sector is also struggling to survive because of the coronavirus epidemic.
Ádám Ribarics is the head of Budapest Residence. Their company dealt with the renting and operating of almost two hundred apartments in Budapest before the epidemic. However, 40 to 50 per cent of homeowners switched recently from Airbnb to long-term housing, and Ribarics estimates that 20 to 30 per cent will certainly not return to short-term housing. Accordingly, it can already be seen that the properties that can be rented for €280 (HUF 100,000) per month have appeared en masse in Budapest, and a big part of them, according to Rentigo.com, are former Airbnb apartments, writes 24.
Currently, 20-30 per cent of the apartments in Budapest Residence are occupied. Without exception, they are rented by Hungarians. It is true that they are taking out flats for the long term, but as prices are very low, the company’s revenue has fallen by 80 per cent from the usual. According to Ribarics, it can already be stated that the number of Airbnb apartments will decrease to 60-70 per cent in Budapest. The drastic fall can already be experienced:
in the autumn of 2015, Airbnb offered 5,200 accommodations in Budapest, and by the summer of 2020, this number had almost doubled. Now, however, we are once again closer to the figure of five years ago, since the short-term housing market monitoring site currently has just over 7,000 Airbnb apartments in the capital.
The roughest decline can be observed in the inner districts, which are the main tourist destinations. In District VII only, more than a thousand apartments disappeared from the market in a few months. But in District VI, many people were also able to switch to long-term housing, where the number of apartments available on Airbnb decreased by a third.
Ádám Ribarics, on the other hand, can already see the light at the end of the tunnel. In a short time, 300 bookings were received by them in April and May, after it was revealed that the effect of coronavirus vaccinations could be felt by the spring. Mostly the English and the Irish flocked to the apartments.
Mihály Rege, the president of the Association of Responsible Accommodation Publishers, said the closure of the borders in September was the last straw for most Airbnb entrepreneurs. He also mentioned that many have switched to long-term housing, expecting that only 40-50 per cent of homes will be on the market even around April and May next year compared to the peak period, such as last summer.
The government wants to regulate short-term renting primarily to help the hotel industry, and the capital wants to regulate short-term renting to keep the estate’s prices low. Ingatlan.com examined last year how rents were affected by the rise of apartment hotels. According to the data provided by Forbes, the rent for a 50-square-metre apartment increased by an average of €36-76 per month due to the proliferation of Airbnb in the inner districts.
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The municipalities can decide on the amendments, but they are not in a hurry, and there will be no decision on the matter this year. However, while previously, several leading politicians, such as Secretary of State Balázs Fürjes and Mayor Gergely Karácsony, also supported the introduction of the time limit, it now seems conceivable that there will be only milder restrictions.
Ádám Ribarics said that the representatives of several districts have already pointed out that they do not necessarily want to limit the number of bookable days because this would strengthen the black economy. Rather, they are thinking of measures such as a night-time inspection body that would be available to the residential community in the case of problems, or a smart device for measuring carbon monoxide and noise based on a French model.
This segment is also struggling to survive now, so it is especially important what decisions municipalities make about tightening rules for Airbnb,
said Mihály Rege, who finds that the district authorities are flexible and helpful regarding the situation, but they feel more hostility on the part of the capital.