July 19, 2024


The Intersection of Information and Insight

New York’s Airbnb Ban Is Causing a Christmas Crunch

2 min read

Christmas is in full swing in New York City; lines snake through Midtown as tourists oggle department store windows and the Rockefeller Center tree, and the Union Square Holiday Market is bustling with vendors and shoppers. All the while, hotel prices are up and vacancies down compared to the 2022 holiday season—and there are almost no short-term rentals, like Airbnbs, for people to book.

It’s too soon to say there’s no room at the inn this holiday season—searches on Airbnb for places to stay during Christmas and New Year’s Eve in New York City bring up hundreds of hotel rooms, rooms in apartments, and rentals claiming to be exempt from new rules in the city. But many of the short-term whole apartment rentals that Airbnb was known for are gone.

With short-term rentals all but banned, early data shows hotel rooms are getting pricier and harder to come by. New York City’s new short-term rental regulations, which took effect in September, are among the most restrictive of any large city in the world. Such restrictions haven’t stopped people from visiting the Big Apple—and this holiday season is a major test of the city’s new rules.

The city’s clampdown on Airbnbs and other short-term rentals seems to be part of what’s sending interest in hotels soaring. Searches for hotels in New York City during the last two weeks of December are up 25 percent year over year, according to data from Expedia Group, which is also the parent company of Vrbo, another short-term rental booking platform. Times Square hotels in particular are up 55 percent in searches, and neighborhoods like Chelsea, Central Park South, Union Square, and Herald Square are all also seeing spikes.

Hotel bookings and prices are inching upward, too. In November 2022, 79 percent of hotel rooms were occupied, with an average cost of $307 a night according to CoStar, which tracks commercial real estate intel. But in November 2023, occupancy climbed to 84 percent, and the average nightly cost hit $333. By the first week of December, occupancy jumped to 90.3 percent, up from 89.6 percent in early December 2022. The average nightly cost swelled from $416 to $477 from December 2022 to December 2023.

It’ll only get busier. Some 64.5 million people are predicted to visit in 2024, according to New York City Tourism + Conventions, the city’s official tourism marketing organization. That’s up from a forecasted 61.8 million this year. This year’s tourism numbers didn’t top records set in 2019, but they got closer, showing that people are returning to travel at near pre-pandemic levels.

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