Vacation home rental company Airbnb (ABNB) is encountering difficulties in Barcelona as the city plans to remove about 10,000 short-term rental listings, including those on ABNB, by 2028. This decision is driven by concerns over housing affordability.
The rise of Airbnb is believed to have contributed to a housing shortage in Barcelona, driving up rents, which negatively impacted the company’s reputation among residents. Additionally, ABNB has faced criticism for contributing to overtourism in the city, though it has attempted to address this issue by promoting less crowded neighborhoods.
Not Just Barcelona
Beyond Barcelona, several cities have implemented restrictions on Airbnb and other short-term rental companies to tackle housing shortages and overcrowding.
Major cities like London and Paris have set limits on the number of nights a property can be rented annually. Additionally, New York, Tokyo, and Amsterdam have introduced stringent rental regulations. Early data from Lisbon and Amsterdam indicates that these measures have helped stabilize housing markets.
The growing trend of cities imposing restrictions on short-term rentals could negatively impact Airbnb.
Is Airbnb a Buy or Sell?
Overall, ABNB has a Hold consensus rating on TipRanks. This is based on seven Buy, 18 Hold, and five Sell recommendations. Analysts’ average price target on Airbnb stock is $130.38, implying a 13.3% upside potential from current levels.
