The rental prices in the temporary accommodation platforms correspond to a trend behavior derived from the development of the Metropolitan Area of the Valley of Mexico and there is no direct relationship between the increase in rents and the increase in available units.
Because it is a matter of general interest in Mexico City, especially in recent times where it has been speculated that short-term digital accommodation platforms are the cause of gentrification and the consequent social displacement in the country’s capital, a A group of specialists in the field of housing, urban planning, economists and technologists, we took on the task of analyzing whether a strong impulse towards gentrification can indeed be attributable to this type of platform. Likewise, it was sought to analyze if the cost of rents has really risen in relation to the increase in short-term accommodation units; and, thirdly, if there are many units of this nature in the city.
In the study that we call “Geospatial Analysis of Gentrification and Behavior of Rent Prices” and that we concluded in February, 134 neighborhoods of the capital were analyzed, distributed in the Benito Juárez, Cuauhtémoc, Miguel Hidalgo and Coyoacán mayoralties. The study was carried out with a geospatial analysis methodology, which is made up of information from official sources. In addition, existing databases were processed to extract valuable information and qualitative and geostatistical data processing was carried out. Finally, the territorial reading of price behavior was analyzed, as well as the geospatial impact and the analysis of the deficit-coverage derived from the gentrification process.
Based on the foregoing, the most important factors that have driven gentrification in the area can be determined: the existence of houses built for decades for rent, most of them with great deterioration and which soon became departmental units; a wide variety of new shops and services; as well as the proximity to attractive destinations that began to change the urban scenario with increases in land value.
Likewise, it was observed that the factors that had the greatest weight in rental prices were extremely varied, ranging from national migratory flows as a result of the insecurity of the past six-year term, to the fact that work centers are located in an important way in the municipalities analyzed. To this we can add mobility and accessibility factors, as well as densification policies in the respective areas.
On the other hand, there are many platforms that offer short-term accommodation services in Mexico City; among them, Airbnb, Booking, Vrbo, Sonder and FlipKey. For the present study, Airbnb was used as the main parameter, making use of the information from the Inside Airbnb portal. In this regard, a growth of the platform can be seen from 2015 to 2018 and although it began to stabilize in later years —even in the midst of the covid-19 pandemic— there was no considerable drop.
Although Mexico City is a comparatively larger city and with a greater population than cities with similar tourist attractions such as London and Paris, which together have just over 127,000 Airbnb units, at the end of 2022 the capital had barely about 23,000 ads on the platform, compared to a total of 2.7 million homes available according to INEGI data.
These 23,000 advertisements were located mainly in the Cuauhtémoc, Miguel Hidalgo, Benito Juárez and Coyoacán demarcations, especially in the Juárez, Cuauhtémoc, Condesa, Roma Norte, Roma Sur, Hipódromo and Centro neighborhoods, within the Cuauhtémoc mayor’s office; Nápoles, Del Valle and Narvarte in Benito Juárez; Chapultepec, Granada and Anzures, as well as the Polanco area in Miguel Hidalgo; and the Del Carmen neighborhood in the Coyoacán mayor’s office.
These areas represent 80% of the concentration of Airbnb units in Mexico City and their attractiveness derives from the implementation for more than two decades of public policies for regeneration, recycling and urban improvement, factors that progressively raised the cost of life in these areas and fostered a process of gentrification, long before the arrival of Airbnb.
What is ultimately appreciated is that gentrification, being multifactorial in nature, cannot be attributed to a single variable; much less to the penetration of a platform as a relevant variable.
In this regard, within the universe of analysis there are 79 neighborhoods that had a positive increase in rental prices, but also 41 neighborhoods that had negative growth; even the Cuauhtémoc mayor’s office decreased prices in most of its neighborhoods in the period 2019 to 2022. What the analysis of said data shows is that the increase in rental prices associated with the presence of Airbnb is merely incidental and is derived previously highlighted tourist attraction, which is denoted since the impact of accommodation platforms on rental prices is not significant and shows a compound annual growth between 2019-2022 of just 1.68%, where there is greater concentration.
In this way, it is possible to determine that the rental prices correspond to a trend behavior derived from the development of the Metropolitan Zone of the Valley of Mexico and there is no direct relationship between the increase in rents and the increase in units available via the platforms of temporary accommodation.
The foregoing is relevant because, faced with a possible regulatory scenario for short-term accommodation platforms, it is imperative to recognize the complexity and social challenges imposed by economic growth and tourism development in Mexico City. It is a metropolis that understands different realities and demands a regulation that provides creative solutions that are consistent with the dynamics of the city.
*The author is the general director of Urban and Territorial Intelligence.
