Florence fact of the day

One in five properties in the historic centre is advertised as a short-term rental, according to researchers at the University of Siena, a 60 per cent growth since 2015. It is the highest concentration in Italy, more than Rome (12 per cent) and Venice (11.8 per cent).

Here is the full Aleksandra Wisniewska FT piece on how Airbnb is transforming many European cities.

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Sad. A tourist in a corded historic center of using a lot of scare resources
he/she doesn't pay for : the maintenance of that historic center, public light, water, quietness, space in the streets, etc. To correct for these negative externalities, there should be a tax (perhaps around $50 per person and per night for big touristic city like Paris or Rome) on every tourist stay.

Owners who are renting out properties do pay for these services via property taxes.

Tourists are also a huge economic boon to these cities.

Regardless, most major tourist cities in Europe do already have a tourist tax exactly as you describe, including Milan, Paris, and Rome (it's possible that AirBNB is avoiding these charges--not sure). $50 per person per night would be an insane level, though. It would almost surely do more harm than good.

There is also a hidden tax on transportation prices. Locals can buy cheaper all-inclusive (train,bus, boat) tickets for a month or a year. Tourists most of times pay the full price.

Yes, and also their use is less concentrated at peak commuting times. During off-peak times, the marginal cost of additional riders approaches zero in most systems.

Also, they don't use some taxpayer-funded services, like schools, at all.

There are certain services that tourists may use more. For example, tourists might cause more police incidents than locals (in party destinations, anyway). But overall, I don't think tourists are "freeloaders" compared to residents.

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This guy Switzerland's.

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Also, tourists tend to be heavy consumers of local businesses--restaurants, shopping, etc., that are taxed, and so contribute that way. Light, water, maintenance--tourists are doing their fair share in those areas.

As for quiet and space in the streets, those are tragedy-of-the-commons situations that tend to be lost when tourists come in large numbers, and I suppose there is a role for a tax there. Might be better if it were a variable tax that went up during tourist-heavy times of year to better spread out the tourist visits.

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"For him and for many citizens property prices have outpaced incomes. "

This is why many see a system that eats up young people, especially those who want to put down roots.

"Some 92 per cent of buildings have no lifts, there are few parking spaces and no local schools, he says. "

You don't need local schools when young families don't exist.

I really don't see a need to have families raising children in historical city centers. Doesn't make sense in any shape or form. You could make an argument on gentrification, and say that rising property prices, driven partly by AirBnB, force existing residents out and make raising families there more expensive. But from all other points of view, from a socialist "rational allocation of resources" and up to a libertarian "free market", it really does make sense to have short term rentals there, and family houses in suburbs. Plus you really want kids growing up in that kind of buildings, instead of suburbia?

Walkable cities allow for the highest quality of life at the lowest environmental impact. Being in the center automatically gives you access to every possible amenity. Why shouldn't people want that for themselves and their families? Economic maximization is not everything. If you are Romanian, as your handle suggests, of course you would be biased in favor of living outside the city, with its high density of small flats in grey buildings, low levels of parkland etc, but there are disadvantages even there, given the requirements of commuting.

Also, too many tourists ruins everything.

I have no problem living in cities, au contraire. I have a problem with building kindergardens in historical centers. You'll end up with a compromise that doesn't make anybody happy - the constraints associated with keeping a historical center... historical... pretty much guarantee you won't be able to have the same quality of life as you would in a normal town/city.

And like I said, it's not just economic output that you're maximizing - I honestly can't think of any metric that isn't better by separating the two. Kids are happier in a kid-centric place, tourists in a tourist-centric place. Buildings in Florence are very much not ... modern. They're old, with high ceilings, small stairs, few amenities, and little legal possibility to upgrade them. And even what you can upgrade is twice as expensive to do so, because you're still facing legal constraints.

with high ceilings

??

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Europe should build new cities and leave the old ones to tourists.

This is what they are doing, in many cases.

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It all depends on the planning time frame. On the short term tourist preferences can be assumed as constant. On the long term, we don't know if AirBnB is just a fad or something here to stay.

If a city bets on tourists and the city loses its popularity by 2030, the locals won't return just because the tourists left. The city will be in an even larger trouble than today. Cities, as cocktails, need an optimum amount of ingredients. Too much alcohol or too much drink mixer make them undrinkable.

The AirBnB model seems unlikely to be a fad. However, it might be regulated out of existence.

I don't think it will be regulated out of existence, it's more probable AirBnB properties are regulated into becoming a "motel": several rooms with minimal services offered by employees.

Regulations will impose overhead costs on AirBnB hosts. Thus, the way to deal with the increased costs of regulation is to specialize in hosting.....or manage a motel.

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This is why Rotterdam is more interesting from a cultural perspective than Amsterdam.

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I’m surprised it’s so low, especially for Venice. surely the social optimum would be well over 50% — it makes sense for these places to be shared broadly

I can't access the full article, but the 11.8% is presumably just one form of accommodation... Maybe just AirBNB.

According to this article, by 2011 there were 26,000 beds worth of accommodation in Venice, compared to a resident population of about 55,000.

http://www.venipedia.org/wiki/index.php?title=Accommodations

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Charleston, SC is an historic city, attracting millions of tourists. It’s also known for the restaurants. But Airbnb may jeopardize it. So many houses and apartments in the historic section have been converted to short term rentals there’s no place for those who work in the hotels, restaurants, galleries, and stores to live. Already several celebrity chefs have left the city because of inadequate staff. Short term rentals also have caused a spike in home prices, as investors (speculators) are buying the housing units. We have experienced something similar with housing in my part of the low country. Like much of tech, it’s an illusion of prosperity. The local government in my community is thriving due to the increase in property tax collections, resulting from the new construction (most of which becomes short term rentals) and increases in assessments. Tech and government have a symbiotic relationship, and not just for surveillance.

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A doctor I know paid for her sons to go to West Coast schools, urging them to take life science (STEM) courses so they could follow in her profession.

Her mistake was purchasing an apartment building in either San Francisco or San Diego for one of her sons.

He converted it into an airbnb, purchased more properties to convert, and has her other son manage the properties.

They both make a good living.

That tells what good STEM can do if your parents have the money. And, also, what short term rental markets do to neighborhoods.

Increasing the return on something only affects the price, never the supply.

Solid Econ, +1

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"Rich lady sets sons up as Landlords" doesn't particularly strike me as a very unusual story.

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Is this so bad? I'm thinking who loses with this. Not the tourists. Not the owners of the properties. Perhaps those shops in the center that don't particularly cater to tourists (groceries, for instance)

Anyone seeking a long-term rental? The working class? The young?

but they don't need to live in the center of town

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Where’s the tipping point? When do these cities become so Disneyfied that no one wants to live there? Are they more or less popular as tourist destinations at that point?

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Around here AirBnB is a way for people to afford housing. Suites in the house, a cabin on the property brings in a good income. They get about twice what they can with renters with far fewer problems. No rent control or impossibility of getting rid of non payers.

Renters are competing with short term vacationers. The hotels was doing ok, but have to up their game.

The municipalities consider these as worse than homeless people who defecate on the sidewalks.

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Tourists bring money into the city, they get the experience that they want. Win-Win. Services such as Airbnb provide an efficient market. This is interesting to hear, but it's generally a good thing.

Florence is a beautiful city. The Uffizi and the Cathedrals, of course are deservedly big tourist draws, but even the less touristy parts of the city, are beautiful.

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I couldn’t read the article, but I’d be curious as to how they define “city center.” Rome is not a giant city geographically but it’s still big enough that there is a substantial portion of the city that exists outside what I perceive to be the city center.

It’s possible that they define it as such a small area that this study is not significant.

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