The Impact of the Sharing Economy on Housing Rental Prices : The Case of Airbnb in Barcelona

We offer a novel approach to investigate the extent to which the expansion of the sharing economy is responsible for increases in long-term rents and prices on the housing market. To this end, we construct a theoretical framework for the housing market that allows for spillover effects between neighborhoods, and other local externalities caused by tourism. The model allows for the short-term housing market devoted to tourism to impact both long-term rental rates and housing prices. Using a panel of quarterly data on newly signed rental contracts and transaction prices in Barcelona from 2015-Q2 to 2018-Q4, we implement a fixed-effects spatial 2SLS method allowing for endogeneity in the variable which measures the presence of Airbnb. We find that a 100-unit increase in the number of Airbnb listings in a given neighborhood induces a 2.1% increase in rents. We find no indication that Airbnb affects transaction prices