Some like it hot. Some like it cold.
Miami and Reykjavik are among the top five most expensive destinations in the Bloomberg World Airbnb Cost Index of more than 100 cities.
Bloomberg compiled the data based on the average daily cost of lodging in private dwellings, regardless of accommodation type, for two guests.
Miami ranks No. 1 and Reykjavik ranks No. 5 with Boston, Dubai and San Francisco in between.
The separate Bloomberg World Hotel Index also counts Reykjavik among the top five for accommodations rated 3-star and above, for two adults in a double-occupancy room. Miami is No. 7 in this index. San Francisco, Los Angeles and Boston are the three top-ranked, with Seattle No. 5.
The U.S./Canada and Middle East are the only global regions where the differential between hotel and Airbnb costs has narrowed, the Bloomberg indexes show.
Miami has the smallest Airbnb-to-hotel price advantage among U.S. cities in the data tallied by Bloomberg. Changes in regulations may contribute to this, according to Arun Sundararajan, a professor at New York University’s Leonard N. Stern School of Business and author of The Sharing Economy. The home and apartment-rental company reached an agreement with the local government in March to collect resort taxes on behalf of hosts in Miami-Dade County.The City of Miami — biggest municipality in the county — tried to ban short-term rentals in residential areas, but a Florida circuit court temporarily blocked the move in April. Miami Beach has banned short-term rentals, with a few exceptions, and it’s been doling out fines of $20,000 to first-time offenders.
Uncertainty about new rules and the court challenge may drive down Airbnb supply in Miami, according to Sundararajan.
“It makes some people hesitant to host,” he said. “People just don’t understand what’s legal, what’s not legal.”
Chris Lehane, Airbnb’s head of global policy and communications says Miami costs may reflect “that this is just a pricey tourism market, which would seem to be the simplest conclusion based on the data we are aware of and the information that’s publicly available.” Airbnb “still ends up being significantly less than the hotels,” he added.
New York also is a popular tourist destination and is taking steps to resolve disputes with local lawmakers, but it offers a sizable Airbnb discount compared with hotels, according to the Bloomberg data.
Both hotel and Airbnb prices have risen in Reykjavik during the past year, as tourism has hit record levels. Game of Thrones fans have come to explore the locations of the popular TV series. Other visitors also are drawn by the volcanic landscape and glaciers, as well as Icelandair stopover deals on trans-Atlantic flights.
The increased accommodation costs may reflect an extreme case of supply and demand as Iceland’s population is about 340,000, while the number of visitors is expected to top 2 million this year, according to Islandsbanki.
“Some areas are simply unable to facilitate 1 million visitors every year,” Tourism Minister Thordis Kolbrun Reykfjord Gylfadottir told Bloomberg in March. If more people are allowed, “we’re losing what makes them special: unique pearls of nature that are a part of our image and of what we’re selling.”
Accommodations like Airbnb are absorbing “a larger share of the number of tourists,” said Elvar Orri Hreinsson, an Islandsbanki research specialist in Reykjavik. “We are expecting a continuation of that trend in the near future and that the sharing economy will grow faster than the hotel industry.”
METHODOLOGY: To defray the impact of holidays, promotions and conventions-related pricing quirks, Bloomberg collected daily average prices, as advertised, for two 10-day windows six months apart: Aug. 1-10, 2017, and Feb. 1-10, 2018. Data research was conducted between May 1-10, 2017. Prices were rounded. Additional fees applied in some cases. Part of the 2016 survey window overlapped with the Rio Olympics.
© 2017 Bloomberg