There aren't many localities in which AirBnBs are a significant fraction of the real estate market. For example, San Francisco sees 40k tourists/day vs. a population of 800k. That's just 5%, and bear in mind SF is the cultural/tourism center of the SFBA with a population of 8000k. Prohibit short term rentals and convert all the hotels to housing while you're at it and you still won't move the needle much on housing prices.
There are many situations in economics in which the marginal effects are quite large especially WRT setting prices. I haven't read or done an analysis but I would never assume that 5% of a market has a 5% influence only in determining prices
SF City Economist Egan took a more careful look and estimated that SF's housing prices could be changed significantly by adding 100k housing units [https://www.sfexaminer.com/news/leveling-sf-housing-field-co...]. Maybe in some markets, like Venice Italy, you could make housing a lot cheaper by enacting a total ban on tourism. But I remain unconvinced that tourism in general or AirBnB in particular is a major factor in general. We can see from Egan's study that it isn't in San Francisco where tourism is our #2 industry, it's impossible to believe that across the country and around the world travelers are meaningfully preventing locals from finding a place to live. People just don't travel that much!
Also, this trick only works once. After we've eliminated global tourism to add fewer than 5% more houses globally, we cannot do it again next year and forever after to keep prices down while we continue to allocate increasingly more of society's wealth to the fixed supply of housing.
There Are many localities where AirBnbs and other STRs make a significant proportion of housing. The town 45 minutes from me is over 15% AirBnbs/STRs. My town is better, but still has too many STRs.
It is common, you just don't want to admit it. It's all over the western US and many, many towns have been impacted. Palm Springs and Joshua Tree aggressively responded for a reason. Because STRs, particularly in Jtree, were inflating home prices at an extraordinary rate and forcing long term residents out.
While it is frustrating to see entire houses used exclusively for short term rentals, I think them being converted to actual single family homes would only be a drop in the bucket in helping to balance the housing market.
Demand would still be absolutely insane if AirBnB did not exist.
From what I’ve seen of airbnbs where I grew up a contributing factor isn’t just quantity of the airbnbs but also the particular houses they choose.
A lot of them are what I think most people would call “starter houses”, relatively cheap pragmatic homes in decent areas. I would assume it has to do with people maybe upgrading houses and doing short term rentals on their first house and probably just that if you’re looking to invest in real estate they’re of course cheaper and a good fit for airbnb style short term rentals. I don’t know though I’d also assume it’s such a pain in the ass to manage that most people would rather sell and get money towards a new house.
Short term rentals should be heavily taxed since they are a business, not a home.