Edit: More for discussion: For those who have long lived in locations that are now desirable, should it be illegal for them to profit from their good luck and/or foresight? Should desirable locations be limited to the exclusive use of those who were there first? Shouldn't more people get the opportunity to visit Bozeman Montana and have somewhere to stay?
"Most profitable" != "best for society at large". Ignoring (or denying) that is the core issue with all these MBA programs, McKinsey and the other consultant vampires. They all preach short-term benefits exclusively while ignoring that without a sizable mass of people who actually have the money to buy things, enough time on their hand to have a reason to buy things and children to keep up the economy, eventually the economy will just crash and burn.
The issue is the housing market is becoming so disconnected from a free market that huge supply imbalances are opening up without supply providers having the ability to close the gap (because of laws and regulations)
That's because you only look at the individual people, which is precisely my point.
For society at large, for the GDP, short term tourists are not what society / the economy needs (unless your entire society is based on tourism, which is a dangerous path on its own as many countries like Croatia discovered during Covid). Short term tourists contribute barely anything to the economy outside of eating out, museum entrance fees and where the law allows for it dedicated taxes (which many AirBnBs just skip on). In contrast, actual economic activity needs people and these people need long term stays.
Yes, towns obviously need a long term population, but this isn't usually the problem outside of smaller rural tourist towns.
Best? Debatable. For the owner? For society?
If it was totally frictionless for everyone else to collect "impaired sleep" and punitive damages from the party-animals renting a unit, that would be in a fundamentally different economic/legal/technological universe than this one.
From the article:
> Arizona even passed a law in 2016 making it illegal to regulate short-term rentals at the local level
Does state government interfering with local government count as “Lack of Government Interference”?
Of course, capitalist economists work very, very hard to conflate “economic efficiency” with “society’s long-term interest” in peoples’ minds—to make people forget that an economy is just part of a society that should serve that society’s goals. They’d prefer if you thought an economy was a society and that all other things were subordinate to it.