The sharing economy and housing markets in selected European cities*

A heated debate has emerged drawing a connection between housing affordability and home-sharing platforms such as Airbnb. Despite first regulatory efforts by municipalities, the impact on rents and house prices has been examined insufficiently in scientific literature, especially with regards to Europe. Therefore, this paper addresses this gap by analyzing data on Airbnb listings for 25 European cities between 2010 and 2019. Using fixed effects and dynamic panel regressions, we show that home-sharing has significantly contributed to a rise in rents and house prices in European cities. While these effects are mainly concentrated in city centers, we also document effects in other urban districts. Finally, recent home-sharing regulations are not associated significantly with housing affordability.