The silent displacement: How Mexico City’s residents are being pushed out by the rise of Airbnb | Society

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Alexandra Dunnet, a 35-year-old screenwriter, has seen the future of a ruined city. The last remaining tenant of a building located in the Condesa neighborhood of downtown Mexico City, she discovered online that apartments recently occupied by her neighbors are now being offered on Airbnb as temporary accommodation for tourists at exorbitant prices. Apartments on her block – she pays 10,000 pesos ($512) a month in rent – are being advertised for 91,800 pesos ($4,700) to so-called “digital nomads”, people with high purchasing power who move around countries with higher incomes low where their money is worth even more.

Earlier this year, the tenants of the building where Alexandra lives were forced to leave because the owners refused to renew their annual contract. She will have to leave her apartment, where she has lived for five years, in January. “What is happening is that people who live in Mexico City will not be able to stay here. We will have to move to other countries and travel to work here. And in these centers, everything will belong to tourism, not the citizens”, she says.

Tourists in the Condesa neighborhood of Mexico City.
Tourists in the Condesa neighborhood of Mexico City. Quetzallee Nicte Ha

In Mexico’s capital, a new kind of silent and forced displacement is taking place. While in other cities in Mexico and Latin America, residents are forced to leave their homes due to insecurity and violence, in Mexico City it is market forces and corporate interests that are forcing people to leave. The rental model of platforms like Airbnb, which promises substantial profits for property owners, is causing mass evictions of tenants in the metropolis. The city government, headed by leftist Claudia Sheinbaum, has opened the doors to the booming tourist rental business.

On October 26, Sheinbaum announced a collaboration with Airbnb and the United Nations Educational, Scientific and Cultural Organization (UNESCO) to promote Mexico City as a “digital tourism hub” for foreign workers staying for periods lasting weeks or months , but which have a higher level. purchasing power than the residents of the cities they choose. “We don’t want rents to skyrocket,” Sheinbaum said during the announcement. “We are not aware of the increase [in prices] related to Airbnb, but rather than Airbnb coming to places that already had higher rents.” However, the evidence shows that there is a strong correlation between increased global platform reach, tenant displacement and rent increases.

The rise of Airbnb

No other rental housing provider is expanding as much as Airbnb in Mexico City. According to a study prepared by the Sheinbaum administration, the number of temporary homes tripled between 2000 and 2020, from 22,122 to 71,780. At the same time, the report acknowledges, more than 20,000 families from lower income groups are forced to leave the city each year due to a lack of affordable housing options. Those people have literally been marginalized, banished to the suburbs. “A large part of this population continues to work and consume basic services in Mexico City, which causes more than 1.5 million daily trips between the metropolitan and central municipalities of CDMX,” the report states.

The most affected area is Cuauhtémoc, home to the historic center of Mexico City and the Zócalo, where the Aztecs founded Tenochtitlan in 1521. According to the study, there are more than 10,000 houses designated for temporary use in the municipality, or 5% of the total number of registered dwellings.

Airbnb does not publish data about its properties in the cities where it operates. What is known is that during the last three months alone, temporary housing reservations increased by 33% in Mexico, according to the platform’s latest report to its investors. The website Inside Airbnb, a user-driven engineering effort, notes that the market has shifted toward longer stays. Further, urban planning specialists point out that the company has grown under the protection of the global housing finance phenomenon, which has turned housing into a commodity, little more than another financial asset.

“Housing finds itself in an uncomfortable position where, while it is the greatest source of wealth on the planet, designed to enrich those who gamble on the stock market and invest in pension funds, it is also a human right protected by The Mexican Constitution and international law”, explains María Silvia Emanuelli, coordinator of the Latin American office of the International Habitat Coalition. “Financialization, which at one point focused on home ownership, is moving towards rental housing. And on platforms like Airbnb she has access to a phenomenal formula to position homes on the market that are effectively targeted at tourists, those who spend a short time in a particular place and who can pay a higher figure than someone who lives here. and needs an annual contract.”

Airbnb declined an interview request from EL PAÍS for access to the agreement signed with the capital’s government. The Sheinbaum administration did not make the document public either. A spokeswoman said deals of this type are usually not disclosed. Specialists and people affected by displacement have criticized a self-described left-wing government for promoting a housing scheme that grows greedily at the expense of the city’s most vulnerable residents.

The Victoria Building in the historic center of Mexico City.
The Victoria Building in the historic center of Mexico City.Quetzallee Nicte Ha

Baruch Sanginés, a geographer who trained at the National Autonomous University of Mexico and holds a master’s degree in demography from the Faculty of Social Sciences of Latin America (FLACSO), compiled data collected by Inside Airbnb to build a graphical analysis of the growth from 324%. the platform has experienced in the Mexican capital over the past 10 years. “What immediately stands out is the focus on the downtown area. The best transport services, museums, restaurants, bars, etc. are located there, and also the most desirable jobs are mostly in this area, where the largest number of Airbnb properties are also located,” he says.

Sanginés points to the accumulation of real estate in the downtown area that has resulted in the displacement of citizens and the increase in the cost of services. “At first it started as an application for people with a specific need, but what has happened, and this is where the criticism lies, is that there are people who suddenly have the resources to invest heavily in real estate. They are able to get a few apartments in a building, a few properties and then everything goes up in price.”

The growth of AirBnb in Mexico City since 2009.
The growth of AirBnb in Mexico City since 2009. Dateviewer

After just over a decade of operating in Mexico, Airbnb is no longer interested in offering one-night stays. In a brief press release, the platform said its goal is to “promote the city as a global hub for remote workers and develop and showcase cultural and creative stays and experiences on Airbnb that enhance Mexico City’s reputation as the Capital of Tourism Creative”. This statement has been interpreted as an attempt to expand the market in popular neighborhoods that, until now, have remained relatively insulated from the influence of the platform.

A giant billboard on the front of a building offers an irresistible deal: the sale of apartments to Airbnb. The sale announcement is a sign of the platform’s expanding business, which is moving away from the already saturated Roma neighborhoods of Condesa and Juárez. “You can live in it or rent it out on Airbnb, it’s not prohibited,” one of the sellers responded to a request for information. In another property in the Roma Norte neighborhood, another pre-sale apartment business is being promoted: “Invest in rental apartments for foreigners”. Its catalog states that the return on investment can be achieved in about 15 months, depending on the rent charged on Airbnb. Prices per apartment range from five to seven million pesos ($256,000 to $358,000) for spaces between 50 and 75 square meters.

Neighborhood organizations have identified cases of silent evictions, where tenants are evicted by landlords so they can rent out their apartments to tourists. In the Centro neighborhood, there are families packing up to make way for new luxury residents. Diana Gatica, 55, is due to leave her apartment, near the Zócalo area, on December 31. “They told me that when the contract ended, I had to leave. I told them, ‘I know I pay a little rent, so if you want to raise it, that’s fine.’ They said, ‘No, your apartment is very important to our Airbnb business because it has the best view.’ I told them, ‘But this Airbnb thing is going to be fixed and then it’s going to go out of business.’ He shrugged and said, ‘We’re in Mexico.'” Diana pays rent of 10,000 pesos ($512) a month, a budget she now has to find elsewhere to live on. “Honestly, the apartments I can afford are depressing. Everything is growing so much. I’m wasting too much time searching and can’t afford anything. I have anxiety: I wake up at night thinking about where I will live now,” she says.

On the other side of the coin, Airbnb is much more profitable than the traditional rental model for property owners. “I found it attractive, a good source of income that gave me a better return than the normal income in the market, which has been on a downward trend in recent years,” says Jorge, who prefers not to give his name his full and, until a few months ago, there were three apartments for rent in the Condesa neighborhood through the platform.

As a businessman, Jorge has explored various investments. Airbnb, he says, has been the best so far. “The traditional rental scheme has some disadvantages,” he says. “The main one is safety issues, especially here in Mexico City, as the law is very protective of the tenant and if you’re unlucky enough to have one taking advantage of that, they can stop paying rent.” The landlord also believes the negative effects of higher prices are good for the neighborhoods where Airbnb operates. “If I’m someone who lives in the area and I earn more, I spend even more. And where do I spend it? Well, in my area. Not everything is black and white, there are many gray areas and these Airbnb rentals have many benefits.”

A sign advertising property sales for Airbnb rentals in Mexico City.
A sign advertising property sales for Airbnb rentals in Mexico City. Quetzallee Nicte Ha

Emanuelli of the International Habitat Coalition says the city government should impose restrictions on the Airbnb model to stem the tide of displacement due to high rents. She adds that there should be official information available about how many apartments are offered by the platform and where they are located, in order to limit the number of Airbnb properties in certain areas. Another measure, she says, would be to limit Airbnb rentals to properties where the owner lives, to avoid entire floors or buildings being occupied by apartments available on the platform. “This is the original formula that Airbnb was based on, within the sharing economy, of sharing an extra room with someone from another city. This does not increase the prices as much as when an entire house is rented out”, explains Emanuelli.

Forced to pack her things and look for another place to live, Diana Gatica once again becomes anxious about the possibility of history repeating itself: “I can find something, but will I be evicted again in three years? What should I do?”

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