How the Airbnb Market in Athens was Impacted by COVID-19
Exploring the greek Airbnb Market by using data analysis, visualization and natural language processing
The COVID-19 pandemic had a devastating impact on most aspects of human activity. Tourism is one of the industries that have been significantly affected, as many companies associated with it are struggling to survive during these challenging times. In this article, we are going to focus on the Airbnb market in Athens, the capital city of Greece, and the ways it was affected by COVID-19. Most people are familiar with Airbnb, the short-term rental platform that is used by millions of people in their travels. Airbnb has transformed the hospitality industry, by becoming a fundamental part of the so-called sharing economy. On the other hand, the effect of Airbnb in cities and local communities has been criticized by numerous researchers, who claim that it leads to higher rents and gentrification¹.
Data Analysis and Visualization
Inside Airbnb is a website that provides free datasets about Airbnb listings on numerous cities all over the world. The datasets of Inside Airbnb are considered reliable, and have been used in various types of research about the effects of short-term rentals². Our analysis is based on the latest dataset available for the city of Athens. Unfortunately Airbnb doesn’t disclose the number of bookings for every listing, so we’ll have to calculate it based on other data. According to the Inside Airbnb team, it is reasonable to assume that about 50% of bookings get a review, so we are going to base our estimation on that rate.
As seen on figure A, the Airbnb market in Athens grew significantly in the period between 2015 and 2019. The number of bookings increased at impressive rates, ranging from 50% to 100% compared to the previous year. That substantial growth came to a halt in 2020, when bookings decreased by nearly 60%, dropping to 2017 levels. The Airbnb market collapse of last year can only be attributed to the COVID-19 pandemic. Other factors may have contributed as well, but identifying them is beyond the scope of this article. Looking at the trend of past years, we can assume the market would continue to grow if the pandemic hadn’t occured, but this is only a speculation.
Let’s take a closer look at the data of 2020, so we can have a better understanding of what happened. As it is evident on figure B, the Athens Airbnb market kept growing in January and February of last year, at a rate of approximately 40%. This is a clear indication it might have been a great year for the market, under different circumstances. Bookings decreased on March, when the greek government imposed a number of strict measures to fight the pandemic, leading to a national lockdown on March 23. The market collapsed on April and May, with a decrease of more than 90% compared to 2019.
The national lockdown was eventually lifted, and the majority of measures were eased by the greek government. This led to a gradual increase in bookings during the Summer, which is peak tourist season in Greece. Regardless of that improvement, bookings in the months of July to October were about 50% fewer compared to the previous year. Due to the significant surge of COVID-19 cases, the greek government imposed a second national lockdown in early November. As a consequence of that, Airbnb bookings dropped again in the last two months of 2020.
Understanding the Athens Airbnb market as a whole, requires shifting our focus to the individual neighbourhoods of the city. This can be accomplished with a choropleth map chart, as seen on figure C. Evidently, the most popular neighbourhoods in 2019 were Omonoia, Syntagma, Monastiraki and Plaka, with more than 50000 bookings in total. This isn’t surprising, as those neighbourhoods comprise the center of Athens, and contain some of the most important buildings and landmarks, like the Hellenic Parliament in Syntagma. A great number of cafes, restaurants and shops are located in the scenic neighbourhoods of Plaka and Monastiraki, making them attractive to tourists and travelers of all kinds.
Another popular neighbourhood is of course Acropolis, where the ancient temple of Parthenon is located, a famous landmark that is visited by millions of people every year. The popularity rankings of neighbourhoods didn’t change significantly in 2020, but the number of bookings was significantly lower for all of them. Omonoia, Syntagma, Monastiraki and Plaka lost around 50% of their bookings, with the decrease in other neighbourhoods ranging from 15% to 70%.
So far, our analysis focused on bookings, but the impact of COVID-19 on the Airbnb market can be assessed by examining other metrics as well. The Inside Airbnb datasets include text reviews that can be used to extract valuable insights. Converting text to quantitative data is a challenging task that can be accomplished with sentiment analysis. This technique is part of the broad field of Natural Language Processing (NLP), and we applied it to evaluate the satisfaction of Airbnb users that visited Athens in 2019 and 2020. The sentiment analysis algorithm was specifically developed for text like social media posts or reviews, and outputs a score from -1 to 1 for every user review, with -1 being the most negative sentiment and 1 the most positive.
As we can see on figure D, Acropolis was the best-reviewed neighbourhood in Athens for 2019, with a score of 0.85. Other neighbourhoods with high scores include Lycabettus and Thiseio. It should be noted that the popular neighbourhoods of Omonoia, Syntagma, Monastiraki and Plaka rank relatively lower with a score of 0.83. This fact suggests that tourists in Athens don’t always have a great experience when they choose to stay in the crowded city center. Sentiment rankings didn’t change significantly in 2020, but the score of most neighbourhoods dropped. The average score of all neighbourhoods for 2019 was 0.82, while the value decreased to 0.77 in the following year. This can be attributed to a number of possible factors, such as Airbnb users being frustrated by the various COVID-19 measures and restrictions, that hindered their experience when they visited Athens.
Conclusion
As expected, the Airbnb market in Athens was severely impacted by COVID-19. This was a direct consequence of the various measures imposed by the greek government to deal with the pandemic and protect the citizens of Greece, as well as the National Health System. Making any predictions is risky, as the situation is volatile and it is impossible to know when the pandemic will be over. Regardless of that, vaccinations for COVID-19 have started in Greece, and all the high risk groups will be vaccinated in the following months according to the greek authorities. If everything goes according to plan, the measures will be lifted and tourists will be able to visit Greece without any problems. Hopefully, this will lead to a quick rebound of the Airbnb market as well. Feel free to share your thoughts in the comments, or follow me on LinkedIn where I regularly post content about data science and other topics. You can also visit my personal website or check my latest book, titled Simplifying Machine Learning with PyCaret.
References
[1] Wachsmuth, David, and Alexander Weisler. “Airbnb and the rent gap: Gentrification through the sharing economy.” Environment and Planning A: Economy and Space 50.6 (2018): 1147–1170.
[2] Gutiérrez, Javier, et al. “The eruption of Airbnb in tourist cities: Comparing spatial patterns of hotels and peer-to-peer accommodation in Barcelona.” Tourism Management 62 (2017): 278–291.
