Spatial Rent Indices for Cities Around the World: A Comparison of Airbnb and Long-Term Rentals

Housing rents are one of the most important and difficult elements of spatial cost of living comparisons. Difficulties arise from the lack of sufficiently detailed and harmonized data, especially at the international level. The mergence of Airbnb has created a valuable new source of internationally harmonized, micro-level rental data that circumvent these difficulties. In this paper, we combine hedonic regression and multilateral price index methods to construct an Airbnb spatial rent index for 60 cities across Europe, the Americas, Asia, Africa, and Australia. We then use this index to investigate four main issues: (i) How Airbnb rents differ across cities; (ii) The relationship between Airbnb and long-term rents; (iii) The role that rents play in determining spatial price differences across cities; (iv) The dependence of housing affordability comparisons on the extent to which rents are quality adjusted.