Is Airbnb still a good business model? Online rental platforms on the rise in Europe

The Airbnb app as shown on mobile - Copyright Media assets Airbnb-

By Greta Ruffino

Published on 11/01/2024 - 12:33•Updated 13:15

Euronews Business looks at the new data on how tourist online platforms are performing and identifies the top destinations to head to.

Airbnb has been around for over a decade and a half. The online platform, which was launched to connect people interested in renting out their homes as holiday rentals with those seeking accommodation, is now valued at over $90 billion (€82 billion) as of 10 January.

The company's revenue primarily comes from fees paid by both guests and hosts, usually a percentage of the booking cost for each. The exact amount depends on the location and booking details.

In an interview for CBS Mornings, Airbnb's Chief Executive Officer Brian Chesky said that the firm has a "pretty resilient model".

Today, the company operates in over 220 countries and regions, including the US, Europe, Australia, and Asia. However, it has faced its fair share of challenges over the years.

Most recently, in December it agreed to pay €576 million to settle a dispute with Italian tax authorities spanning the period between 2017 and 2021. At other times, it has been accused of allegedly not providing enough assistance to guests, such as when a guest was allegedly thrown out of a rental with their possessions dumped in the streets outside in the middle of the night in Washington DC, due to an overbooking.

However, despite controversies, the online platform, along with others, still seems to be a flourishing business.

The growth in numbers

In Europe, during the third quarter of 2023, guests spent 309.4 million nights in short-term rental accommodations booked via Airbnb, Booking, Expedia Group, or TripAdvisor. This is 13.4% more compared with the same period in 2022, according to new data released by Eurostat.

In the first nine months of 2023, guests booked over 546.2 million nights in EU short-term rentals through online platforms, experiencing a growth of 11.8% compared to the same period in 2022, and surpassing pre-pandemic levels (423.7 million nights in the first nine months of 2019; 28.9%).

Where are people travelling to?

In the second quarter of 2023, the most popular places for short-term rentals booked online in the EEA were Spain (7.1 million nights), Croatia (6.5 million) and France (5.8 million), according to Eurostat.