The internet has made some miraculous changes in the way we communicate. People across the globe can now connect in an instant and interact via voice or video. It’s no wonder, then, that both individuals and businesses alike are finding ways to use the internet to their advantage, sometimes in surprising ways.
The real estate industry uses the internet and mobile apps to enhance the home buying experience. These technologies allow house hunters to follow listings in their favorite Portland neighborhoods and search for suitable Portland modern homes. Individuals, meanwhile, have found other ways to make the most of their properties thanks to sites like Airbnb and VRBO.
These sites let users list their Portland condos, lofts, and homes for short-term rental to anyone looking for a place to stay. Home rentals are often less expensive than nearby hotels. These trends are creating an impact on the hospitality industry as they lose customers to these rentals. How is it affecting Portland real estate, though?
Positive Impact
On the one hand, many people are looking to take advantage of favorable housing prices and interest rates. They are still lower than when the housing market bubble burst back in 2007, making it less expensive to purchase rental properties. These people may already own a primary residence or they might be looking for larger properties where they can create a granny flat or a separate area for short-term rental purposes.
This state of affairs could be helping the market to recover from the recession (not that Portland needs much help with so many new residents moving in and the population growing). Of course, good real estate agents will first warn clients seeking Airbnb properties that Portland lofts, condos, and even homes could prove problematic if homeowners associations get involved. They could also run into trouble since second homes don’t offer the same tax breaks as primary residences.
Negative Impact
There are a couple of possible negative impacts of the growth of the sharing economy, particularly in regard to short-term rentals. Already, many states, cities, and municipalities are formulating plans and enacting legislation limiting short-term rentals. They are also calling for these rentals to pay lodging taxes (as with hotels).
This could create problems for owners who purchase properties relying on short-term rental income to pay the mortgage. In addition, Airbnb and similar services are disrupting the home buying experience for those seeking legitimate primary residences.
With properties in Portland already scarce, prices continue to skyrocket. These factors are making it difficult for average residents and newcomers to purchase property. The influx of temporary guests in residential communities is also making homeowners quite upset.
At the moment, there’s little communities can do – Airbnb alone has become a multi-billion-dollar business. Changing legislation may cause the fervor to subside somewhat. However, the sharing economy surrounding short-term rental trends could be here to stay. The real estate market may simply have to adjust.