Cities across the U.S. are grappling with a housing crisis, and short-term rental platforms like Airbnb and Vrbo have found themselves at the center of the debate. Since Irvine, California, banned short-term rentals six years ago, the city's leadership remains confident in the decision.

"It's been great," Irvine Mayor Farrah Khan told reporters, adding that residents have supported the ban. Irvine is just one of several municipalities tightening restrictions on short-term rentals, arguing that they exacerbate housing affordability issues by removing homes from the long-term rental market.

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As reported by CNN, however, economists and housing experts do not completely agree on how significant a role short-term rentals play in driving up rent prices. “Real estate is local,” said Michael Seiler, a finance and real estate professor at the College of William & Mary.

According to Seiler, the impact of Airbnb and similar platforms varies based on local market dynamics, making it a nuanced issue rather than a one-size-fits-all problem. "Everything that someone says is bad about Airbnb, I can tell you there's a corresponding group who feels it's good."

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The short-term rental market in the U.S. has exploded, reaching $64 billion in 2023, up from $39 billion just four years earlier, according to data from AirDNA. The increase in listings, which now number over 2.4 million, coincides with a nationwide housing shortage.

Experts estimate the U.S. needs to build around 2 million homes to address the supply-demand imbalance. Still, many properties listed on platforms like Airbnb are vacation homes or people's primary residences, meaning they might not return to the long-term rental market even if restrictions are imposed.

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According to Airbnb's Vice President of Public Policy, Theo Yedinsky, targeting short-term rentals to solve the housing crisis won't fix the problem. "Every housing unit that's on Airbnb isn't necessarily going back on the long-term rental market," Yedinsky told CNN.