Paris Airbnb bookings up 400% ahead of Summer Olympics

From the end of July to mid-August, the world gathered in French cities, and Airbnb (NASDAQ: ABNB) reservations in Paris swelled 400%, and that wave spread to surrounding cities such as Saint-Denis (Olympic Village, host of 3 venues), Châteauroux (shooting competition), and Lille (basketball and handball). Additionally, demand for hotel accommodations has increased active listings on Airbnb (ABNB) by 40%.

The majority of bookings are made by American travelers visiting France, followed by British travelers, French people and Germans taking 3rd and 4th place.

In terms of growth rate, Asian countries are at the top, with the highest rate of increase in travelers from mainland China, followed by India, Hong Kong, and Japan.

The agreement between Airbnb (ABNB) and the International Olympic Committee gives a foothold to this city, which has been negative about short-term rentals in the past. In an attempt to limit the number of short-term rentals (ABNB, EXPE), the Paris city authorities established regulations such as limiting rentals to 120 nights per year and requiring owners to register properties at the city hall. The city authorities even considered prohibiting the use of small lock boxes to hold rental keys, assuming that they are “an eyesore” throughout the city.

However, while 3 million people are expected to come to Paris in 2 weeks of the Olympics, the fact that there are few hotel rooms that can be used for people other than those involved in the Olympics meant that the city could only expand hotels or expand lodging options different from the past. The Paris city authorities accepted this and understood that the influx of tourists into the local economy would offset concerns about disturbance and congestion in residential areas.

Good news for tourists is that prices are expected to drop as supply increases. As the game gets closer, tourists may be pleasantly surprised that prices for non-traditional lodging facilities (ABNB, EXPE) are actually falling. The fact that rental housing is saturated, combined with the sports federation releasing hotel rooms with excessive reservations, means that rental prices have dropped from 30% to 60%.