Visiting New Orleans for Jazz Fest?

Staying in an AirBnB?

 
 

Unfortunately, it is likely you are contributing to the process of housing displacement of musicians and cultural workers in New Orleans, the very same people you clap and cheer for on the Fairground grandstands. By using AirBnB, you may think you’re simply renting a room from a New Orleanian for a couple days - to enjoy the historic city, get an authentic local experience, come and go as you please - all at a decent price. But there’s much more to AirBnB than meets the eye.

 

new orleans' affordable housing crisis

In reality, AirBnB is dangerously messing with our city’s housing stock. Much like many cities around the U.S., New Orleans is currently experiencing an affordable housing crisis: 61% of renters pay over 30% of their income in rent, 38% pay over 50% of their income in rent, and the median rent for a 2-bedroom unit increased by 25% from 2012-2015. This problem is exacerbated by the fact that New Orleans is a literal city of renters, with 55% of the population categorized as renters. Like many other civic issues, housing unaffordability disproportionately impacts people of color: nearly 4 out of 5 low-income, cost-burdened renters in New Orleans are Black.

  Source: Report by New Orleans Redevelopment Authority and The Center for Community Progress:  Where will People Live? New Orleans' Growing Rental Housing Challenge, March 2016

Source: Report by New Orleans Redevelopment Authority and The Center for Community Progress: Where will People Live? New Orleans' Growing Rental Housing Challenge, March 2016


airbnb intensifies the crisis

However, unlike other cities experiencing affordable housing crises, New Orleans is a city whose economy is based on tourism: for every one New Orleans resident, there are 25 tourists visiting the city in a given year. The City has set a goal of attracting 13.7 million tourists in 2018, up from 9.78 million in 2015. City officials make decisions that place short-term tourists before long-term residents, all in the promise that tourism will boost the city’s economy. The more options for tourists, the better, thus leading to the proliferation of AirBnB’s in the city: the number of AirBnB listings in New Orleans has swelled from 1,905 to 4,316 in the past 18 months; of those 3,146 are listed as entire homes (72%).

% Whole Home Listings


"whole homes" = an entire home off the rental market

 

% Hosts with Whole Home Listings

Entire home? I thought that AirBnB renters just rented out one or two rooms in their house? No, this is far from the case. 72% of AirBnB listings in New Orleans are “whole homes,” meaning that the lister is renting out their entire house and not occupying the house while the listing is active. This point is key, because it shows the hidden reality that the majority of hosts are not your typical local resident, but are business people and corporations. Of those whole-home listings, 66%, or 2,099 of them, are managed by 395 hosts offering more than one listing. That means that those 395 hosts have an average of 5.3 homes each (with the top ten hosts in New Orleans comprising 167 units!). These are people who have made it their business to rent to tourists rather than residents; many of them do not even live in New Orleans.


our neighborhoods are at risk

Ok, so what’s the problem? Who cares if tourists now have more options to chose from when deciding where to stay? Because now, tourists aren’t limited to the Central Business District or French Quarter (where all the hotels are). They’re moving out of tourist-engine downtown and getting AirBnB’s in more traditional neighborhoods (Mid-City, Marigny, Lower Garden District, Bywater) and most notably, historically black neighborhoods (Seventh Ward, Sixth Ward, Central City, and St. Roch). This shift just so happens to be in line with the City's new tourist marketing strategy [see right]. When mass amounts of tourists come into traditional neighborhoods, they have both negative short and long-term effects.


short term impacts - "shifts in community fabric"

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Introducing... Bluesy Fairytale [picture featured below]. Bluesy's host bought her in 2015 and began her transformation into a whole home AirBnB. Bluesy's neighbors become annoyed. They complain of loud music, people drinking in the street at night, increased amount of trash and littering, and unfamiliar people always coming in and out of Bluesy. The neighbors start to miss the family of 4 that used to reside in the modest house.

It is definitely sad to lose a neighbor, but it is all the more painful when you realize that short-term tourists are taking their place. Instead of a working class family with 2 children residing in a home in a traditional neighborhood, with access to schools, public transportation, parks, walk/bike paths,  grocery stores, community centers, neighborhood businesses, etc. - all the aspects of a healthy life - Bluesy now simply houses strangers, people who don't contribute to the community fabric, other than paying for Ubers and patronizing local businesses.


long term impacts (the G word)

Let's just pretend that Bluesy Fairytale is being rented out at the AVERAGE AirBnB price of $233/night (much lower than the listed price of $813), which translates into $6,990/month. This monthly figure is significantly higher than the average 4-bedroom monthly rent of $1,675, the average price New Orleans family would pay to rent. This extreme hike in rental price is just the first factor in the dangerous game of rising property taxes. The other major factor is the hike in building value this whole home experiences as it undergoes renovation and redevelopment by its AirBnB host. In the chart below, the building value of Bluesy skyrockets after its host renovates from 2015-16, and thus increases the house's taxable assessment to nearly $30,000, nearly 12 times the 2015 assessment.

  Source: Orleans Parish Assessor's Office

Source: Orleans Parish Assessor's Office

Suddenly, Bluesy's owner decides she's had enough of hosting, and sells the house for nearly $300,000, an extremely inflated rate compared to its previous selling prices [see chart to right]. But Bluesy does not operate in a vacuum - since her property value is so much higher, assessors make the assumption that the houses surrounding Bluesy have also increased in value. What begins as one house's property taxes rising, ends up creating a ripple effect where the houses around Bluesy are suddenly being bought and sold at inflated rates. This drives a speculative form of capitalism that leads people to buy houses at mortgage rates they can ONLY pay back if they believe they can "make extra income" from short term renting their house. And let's not be mistaken - a large sum of these "people buying houses" are actually COMPANIES who have the capital and resources at their disposal to buy up houses fast by putting way more down than is normal, making it impossible for everyday people to compete in this housing market. 

  Source: Orleans Parish Assessor's Office

Source: Orleans Parish Assessor's Office

 

This is the definition of gentrification . . . when the cost of redevelopment is exceeded by the return on investment, which catalyzes more investment, and displaces those who can't afford to keep up.


pricing out new orleans culture

  After April 1, 2017, it’s legal to rent homes in New Orleans via Airbnb, VRBO and similar services (per recent City Council ordinance). Up until now, short term rentals were illegal in the city, but were impossible to regulate. Under the new ordinance, STR's remain illegal in the French Quarter. This map shows the plethora of AirBnBs that are currently operating illegally in the French Quarter (solid red), and the rest of the city. Source: insideairbnb.com

After April 1, 2017, it’s legal to rent homes in New Orleans via Airbnb, VRBO and similar services (per recent City Council ordinance). Up until now, short term rentals were illegal in the city, but were impossible to regulate. Under the new ordinance, STR's remain illegal in the French Quarter. This map shows the plethora of AirBnBs that are currently operating illegally in the French Quarter (solid red), and the rest of the city. Source: insideairbnb.com

  Under the new ordinance, all short term rental hosts must apply to obtain a license. This map shows the 2,016 applications received and their approval status. As you can see, the solid red in the French Quarter is gone. The question is, where will the current French Quarter hosts go, and, if they are operating a business, what's stopping them from expanding their business into the surrounding neighborhoods?

Under the new ordinance, all short term rental hosts must apply to obtain a license. This map shows the 2,016 applications received and their approval status. As you can see, the solid red in the French Quarter is gone. The question is, where will the current French Quarter hosts go, and, if they are operating a business, what's stopping them from expanding their business into the surrounding neighborhoods?

Who can't keep up? Who's getting pushed further and further away from the heart of the city? The same people that you traveled here to see: 

  • Local musicians who play at Jazz Fest, on Frenchmen, and virtually anywhere you ask them to
  • Renowned chefs who cook you gumbo, shuck your oysters, and fry your catfish
  • Bartenders and other service workers who serve you drinks and work long nights
  • Local visual artists whose work you admire but never fully get to understand

Other locals being displaced include:

  • Low-income people, primarily people of color, who can no longer afford to pay their rent or their property taxes
  • Business owners who are bought out because their commercial property can now be used as an AirBnB
  • Local bed-and-breakfast owners who are experiencing decreases in sales due to AirBnBs
  • Other hospitality and cultural workers, whose magic and creativity on which the New Orleans tourist economy runs
  • The list goes on and on...

 

So, what can you do about it?

There are many ways you as an individual can make better educated choices about how you use accommodations in New Orleans and any other city.

1. BOYCOTT WHOLE HOMES. It's very simple to avoid booking an "entire home" when you're renting AirBnB. The other 2 options, a private room or a shared room, are what deliver the "living like a local" experience anyway. Really want a whole home to yourself? I hear Zillow always has great deals.

2. Support the local economy by staying at hotels or BnBs. Here's a crazy stat: over 20,000 people booked rooms on AirBnB for the 2016 Jazz Fest, while for the first time in years hotels and traditional BnBs had vacancies (Source).

3. Educate yourself on the negative impacts that AirBnB can have on local economies and long-term city residents, so you can inform your friends and family when they're looking to short-term rent. Below you will find links to: a podcast about short term rentals and their long term impacts, NOLA Rental Report where most of the statistics here were found, and Inside AirBnB, the site that promotes transparency of this multi-million dollar company who does not disclose any of their data to their customers or stakeholders.

4. Educate yourself on the December 2016 New Orleans City Council vote that passed a series of ordinances that amount to a landmark regulatory framework for short-term rentals unlike any other city in the nation, further proliferating the spread of AirBnBs and further exacerbating the rental and affordable housing market.

5. Get involved with European Dissent, a group of white people organizing for collective liberation from racism as part of a multiracial movement for a more just society. This site was created by the Anti-Gentrification Working Group, a task force of European Dissent that is dedicated to understanding how capital and state and city policies work together to displace people (primarily people of color), and mobilizing white people to advocate for housing justice, tenants rights, and overall resistance to gentrification and displacement.

Let us know you're interested in getting involved by completing the form below. You could help us distribute our AirBnB "coupons," or learn about our upcoming campaigns.

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The data and analysis on this site was compiled by Jane Place Neighborhood Sustainability Initiative (JPNSI) and initially shared at a series of local teach-ins about short term rentals in the summer of 2016. Jane Place is a housing and community development nonprofit committed to creating sustainable, democratic, and economically just neighborhoods and communities by utilizing the community land trust (CLT) model of shared-equity and land stewardship. If you are interested in arranging a teach-in, please contact JPNSI.