Rising rent and housing evictions, the effect of gentrification without regulations in this regard: specialists

After the Covid-19 pandemic, Mexico City (CDMX) became one of the favorite destinations for foreigners who decide to carry out their work activities remotely, while living new experiences in flexible and more accessible places than in their countries of origin. source.

In order to take advantage of this trend, the capital government signed a collaboration agreement with Airbnb, a temporary accommodation firm, to attract digital nomads to CDMX and generate an income of up to 1,400 million dollars annually, but the idea raised concerns about the impact that this agreement can generate, especially in terms of living place y access to the city for people with lower incomes.

Maria Silvia Emanuelli, coordinator of the Latin American office of the Habitat International Coalition (HIC-AL), explained that renting entire apartments through this digital platform can make prices more expensive. rental prices up to 7% in certain areas.

“Other cities have suffered the onslaught of Airbnb and have tried to regulate when they see that the situation is getting out of control, since they have realized that rental prices can rise up to 7%,” explained Emanuelli.

Prices that become unattainable

It is estimated that in Mexico, around 5.8 million households son rentedof which in many cases (51%), are rented by people who do not have access to credit or do not have sufficient resources to acquire a property.

In Mexico City, many households Complete houses and apartments begin to adapt to be able to offer accommodation services to foreigners, through Airbnb, which has a direct impact on the rental values ​​of the areas that are most popular with foreigners.

A recent study by Benvi and Quinto Andar places Mexico City as one of the most expensive cities in Latin America in terms of rentals, from 50,000 to 90,000 pesos per month, in the most expensive areas.

“Accessibility indicators reveal a dissonance between the formal real estate market and the reality of Mexican families with average incomes (17,933 pesos per month according to the 2020 National Household Income Expenditure Survey),” said Vinicius Oike Reginatto, in charge of research and specialist in economics and data in Quinto Andar.

In Mexico City, there is a housing stock of just over 3 million households and it is estimated that the Airbnb offer in the capital is 22,948 accommodations, of which 61% corresponds to entire houses and apartments, 36.2% to private rooms, 1.5% to shared rooms and 0.7% to hotel rooms.

According to the Inside Airbnb platform, the largest offer from the foreign firm is concentrated in the Miguel Hidalgo, Cuauhtémoc and Benito Juárez delegations, where the average rental prices monthly are as follows:

Fuente: Propiedades.com

Although these values ​​are at a delegation level, in neighborhoods visited by foreigners, such as Roma Norte or Condesa, the average prices of Apartment rental range from 21,150 pesos to 27,053 pesos per month, while in the house rentals the average values ​​range from 49,187 pesos to 53,738 pesos per month.

With houses and apartments becoming less accessible, the population of the big city is forced to migrate to other areas. It is estimated that every year, around 20,000 people who cannot buy or washso they choose to settle in peripheral areas, while another 7,000 go to live in precarious and high-risk settlements.

The risk of evictions

But the “boom” of apartments for rent of short stay has not only impacted the cost of renting or buying living placeis also linked to another problem that set off the alarms of 53 organizations and 835 people who spoke out against the agreement, that is, evictions.

After a consultation with the Secretary of Citizen Security (SSC), the Evictions Network and the HIC-AL found that around 3,000 housing evictions a year in Mexico City: “We have followed up on the causes and among them is the gentrification and tourism, so they could increase from the agreement with Airbnb”, assured Emanuelli.

Judith Reséndiz, representative of the Eviction Network, shared that, so far, there is knowledge of at least eight residential buildings that are going through dispossession processes to cede them to the platform, which are located in the streets of the Historic Center: Justo Sierra , San Ildefonso, Bolívar, Isabel la Católica, Luis Moya, López and Revillagigedo.

“This is part of the excessive gentrification that is taking place in the capital, in which real estate firms monopolize the buildings in the best areas to offer them to tourism, without taking into account the housing needs that the population of origin has”, added Reséndiz.

Data from Inside Airbnb shows that there are hosts who concentrate up to 200 units offered: “That is, who renta a small room in his living place it is not the real business, but those who even participate in the stock market with real estate funds”, argued the coordinator of HIC-AL.

Both representatives of the organizations agreed that tourism and digital nomads are a market that can reactivate and benefit the economy of Mexico City, while small property owners can earn extra income through the rents short term.

However, they pointed out, the main problem with the agreement with Airbnb is that there is no prior regulation that measures the impact and regulates the transnational, as cities like Paris, Rome, Miami or New York have tried.

That is why they propose a series of measures, among them: make the data transparent; oblige owners to register their property and pay taxes; limit the number of units offered per area; regulate the rental of complete houses; as well as, reduce the maximum stay times.

So far, the organizations that signed a statement against the agreement have not received a response from the capital’s government; however, they plan to insist to find out the reasons why “they went from protecting the historic centers that are world heritage sites to favoring appropriation by a transnational firm,” declared Emanuelli.