New research from Colliers International and Hotelschool The Hague reveals that despite many countries recently introducing legislation to restrict the use of Airbnb, the hospitality service continues to grow in five main European cities – London, Amsterdam, Berlin, Madrid and Paris.

The analysis demonstrates that guests continue to book Airbnb accommodation in the respective cities, with its share in the overnight stay market increasing by up to 3.4% since 2016. 

Market share increase:

London: 5% to 6.9%
Paris:13.4% to 15.2%
Amsterdam: 10.7% to 11.8%.
Berlin: 5.3% to 6.5%
Madrid: 6.7% to 10.1%

Marc Finney, Head of Hotels & Resorts Consulting at Colliers International commented: “In all cities, it’s clear that Airbnb is here to stay and has become a mature alternative for traditional hotels. With Airbnb, guests have more options to choose from and it’s also a cheaper alternative to hotels.  

“As the scale grows, the lack of regulation becomes a greater concern to many, and rightly so. It is interesting though that despite the growth, we’re seeing relatively little negative impact on the hotel sector with London hotels achieving similar results to last year. In a lot of ways, Airbnb is a different product offer, and one that now benefits from better visibility. Despite its growing influence, we’re still finding strong business cases for proposed hotels in our development advisory work.”

Total and growth of overnight stays 2016 vs 2017:

London is the largest market for overnight Airbnb stays (6,703,337 overnight stays – a 45% rise compared to year before), just ahead of Paris (6,449,404 overnight stays – a 28% rise from 2016-2017), but the UK’s capital is growing at a much faster rate. These cities are almost three times the market size of Berlin (2,159,999 overnight stays -  a 24% rise), Amsterdam (2,080,488 overnight stays – a 25%) and Madrid (2,155,362 overnight stays).

In addition, Madrid wins the accolade for the fastest growing market, with guests booking 67% more nights in an Airbnb accommodation in 2017 than in 2016. 

Damian Harrington, Head of EMEA Research at Colliers International commented: “Several cities have introduced legislation for Airbnb over the past few years. In Berlin, hosts were prohibited to offer an entire home on the platform since May 2016. In London, a rule was introduced that enabled hosts to let out their home for a maximum of 90 days per year. Similar legislation was introduced in Amsterdam, but here the maximum number of nights was limited to 60. Although the data can’t clearly state whether hosts adhered to these rules, it does show that none of these cities were able to limit Airbnb growth in their respective cities. Madrid and Paris have recently announced that legislation will be introduced, but the effect of the new regulations is questionable.”

“Our analysis shows that introducing legislation alone is not enough to limit Airbnb activity”, added Jeroen Oskam, Head of Research at Hotelschool The Hague. “Although the local government set up quite clear rules in these cities, it is hard to enforce them because of the lack of available data. Without forcing Airbnb to become more transparent, local authorities will keep having problems enforcing regulations.” 

Average Daily Rate 

Interestingly, the research reveals that average daily rates (ADR) for Airbnb units in Amsterdam (€106 -€375) now surpass those of both London (€34-€367) and Paris (€36-€434). While London and Paris may have a lower ADR than Amsterdam, they have a broader range of pricing on offer to suit budget travellers. Paris has the most expensive units, with top-end pricing in Amsterdam and London now evenly matched. 

Madrid (€29-€272) and Berlin (€31-€263) are clearly the most cost effective of the cities studied, with Berlin offering the lowest ADR of all five markets. Both markets offer nightly rates at less than €50, and at a similar level to those of Paris and London, but their top-end rates are also significantly lower. 

Type of Airbnb accommodation booked

In terms of unit types, entire one-bed and studio apartments are overwhelmingly the most popular choice across all cities. However, private room popularity also remains strong:

Additional London findings

London:
  • The three boroughs that were the most popular among Airbnb travellers were the same as in previous years: Westminster, Tower Hamlets and Camden. Together, these boroughs account for 35% of all booked nights. This indicates that Airbnb users in London are more evenly dispersed across the capital than in the other cities: for example, in Berlin, the top three neighbourhoods accounted for 50% of all Airbnb stays. In Amsterdam, this percentage was 44%. 
  • As in other years, entire home rentals were the most popular of all unit types. 69% of all booked nights in Airbnb were for an entire home. Just over 30% of bookings were for private rooms, with less than 1% booking a shared room.  
  • In 2017, the municipality introduced legislation whereby hosts are not allowed to let out their home for more than 90 days. However, data does not show clearly whether hosts comply with this regulation.
Multi-listers control listings in London

The majority of listings are offered by hosts with more than one [property] listing in London, the so-called “multi-listers”. Around 62% of listings are offered by hosts that have at least two listings, which is in contrast to the other cities where hosts with just one listing control at least 60% of the total. Only in Madrid is there a similar trend, with around 23% of listings offered by hosts that offer more than 10 [property] listings on the platform. These hosts are often intermediary companies that manage the listing on behalf of the actual owner.