The prevailing view on short-term rentals right now seems to be this:
That is, it’s viewed as a zero-sum game between residents and tourists. There are only so many homes within a city, and so if any of them are to turn into short-term rentals, then it is a direct reduction in the supply of available long-term homes. This can also happen very quickly given the asset-light nature of Airbnb and the fact that these spaces aren’t usually purpose-built.
It is for this reason that many cities have enacted strict short-term rental laws that basically only allow you to rent out your principal residence when you’re not around or if you happen to have extra space. In the case of New York, you have to be physically present when the dwelling is being rented, and so the use case is exclusively “I have extra space for you.”
Either way, the basic idea is to stop people from removing homes from the long-term market. I do, however, find it curious that reductions in housing supply seem to be generally viewed as bad, but that increases in housing supply are often met with skepticism. Doesn’t housing supply work in both directions? Why aren’t more people clamouring for new homes to be built?
Where my head is at on this issue is that I don’t see it as a zero-sum game. I believe that there should be rules and regulations around short-term rentals, but that they shouldn’t stamp out all use cases other than “here’s an air mattress in my living room.” At the same time, I think we should be viewing this as an opportunity. Clearly we need more homes, more hotels, and more short-term rentals.
It’s only zero-sum if we make it that way.
BRANDON DONNELLY 
I tend to agree with you on this point, except that AirBnB operators are not playing on a level field.
I wrote this in an article earlier this year (from the viewpoint of a British Columbian):
“ A short term rental owner is no different than a small time hotelier. A hotel is, by definition, “an establishment providing accommodations, meals, and other services for travelers and tourists.” An AirBnb is generally not a “bed and breakfast”. I have never been served breakfast at any AirBnb I’ve ever been to – nor was I expecting it. I’ve only ever met the owner of a property once: and yes, she lived on the property in the main house. The small time hotelier – a AirBnb operator – is effectively engaging in a commercial operation on a residentially-zoned property, yet only paying residential property taxes. Commercial property tax is usually taxed at 2.3x the rate as residential. Essentially, this means that residential taxpayers are subsidizing the taxes for the commercial operation, while the operator is reaping the profits. Is this fair?
…
I would be more in favour of allowing for investors to keep their short term rentals operating, so long as they pay the appropriate property taxes on top of the other regional taxes that were already levied against them as hotel operators. It is likely that if someone had to pay the more fair $9,200 in property tax rather than the $4,000 they were paying, they might make different financial decisions – and even if they didn’t, the municipality and taxpayers would benefit from a more equitable system that still allows for increased capital investment.“
.-from Fairness, Affordability & AirBNB in BC (November 5, 2023)
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