Boston Airbnb Exploratory Analysis
By: Felipe Mascolo
Tags: Data Presentation, Editors Pick, Data Science, Data Visualization, Data Analytics

Analysis Background

One of the most well known short-term rental online, Airbnb, Inc is an American company based in San Francisco, California. It’s specialised in accommodation deals, homestay and tourism experiences, even without being an owner of any real state listings.

Showing a constant growth year by year since the foundation, it’s natural that Airbnb turns an attractive market for anyone who has the interest to make investments. Along with that arise, lots of queries about how to be guided to get the best possible decision-making.

In this project, we will explore Airbnb business in Boston city through the data analysis, identifying which options could be more profitable and interesting to invest.

Dataset

For find the answers, we will use the files from Airbnb Boston, provided by Data.World. That dataset consists of three main files: listings, reviews and calendar, starting in 2009 until 2016.

In additions, external searches were carried out regarding additional information about Boston City.

Data Exploration

Boston’s Airbnb Listings and High Season

Firstly, we will bring a general overview regardless of listings, high season and price variation, in which will helping us to have an idea about what we can expect as an investor.

The chart above shows us the listings growth by year, in which it’s possible to observe the substantial and constant growth since 2009. However, we can note the growth losing strength year after year.

Based on the average growth by year as an initial parameter, the increase along the last five years its around 124% of new listings. Comparing the last years, we can see the weakest growth into the analysed period. The estimative of new listings show us a rise around 26% in 2016, way smaller in comparison the previous year (2015), with 157% of new listings.

As we don’t have further information about the bookings in the dataset, we crossed the number of reviews and minimum stay nights, into the period of March 2009 and September 2016. This estimative show us a conservative result since possibly will exist more bookings, and the guests could stay further than the minimum required days.

The High Season chart indicates that the period between July and September is the busiest time in Boston city, especially taking the period starting from 2013 until 2016. The peak was in 2016, reaching the amount of 9.502 visitors, with average growth in the same year around 49%.

The next graph demonstrates the price variation between October 2015 and October 2016. The highest average price charger per day also happens in the third trimester, with a price peak in September, reaching an almost 37% higher prices, at $249 per day.

The more significant fall of prices occurs in December, when the average price decrease around 31% regarding the peak, achieving in $199 daily. The lowest value observed appears in the first semester, with $188 per day.

As in the “High Season” chart, it’s observed the tendency of increase in the third trimester and the decrease in the fourth trimester, when the low demand drops the prices proportionally.

Property Type Analysis

The Airbnb Boston offer lots of different properties for rent. The visitant can choose since an entire house or apartment until the boat, Camper R/V or just a single affordable Room. However, we will keep the focus on the kind of property that present more listings and likely more demand.

Checking the dataset, we can find available the total 2880 properties, where 7% are condominiums, 16% are houses, and 77% are apartments, spreads along 23 neighbourhoods.

Another relevant information concerns what kind of property has the preference for hosts and super hosts. 78% of the total hosts have apartments or even apartments besides other properties, and 65% of super hosts have apartments among other properties.

From now on, we must keep the focus on the apartments proprieties.

The analysis above show us the guests preference regarding room type in each neighbourhood.

The majority of guests who search for apartments have a preference to rent the entire place, resulting in 1528 of the total proprieties, corresponding to 70%. The private room is the second preferred option with 605 units and corresponding to 28% of the total. Far from the previous options, shared room respond for only 2% of the preference, with 38 units.

Considering the entire apartment options, Back Bay, South End and Fenway-Kenmore are the neighbourhoods with more number of units. If we take into account all rent options, arise Allston-Brighton neighbourhood as a new option. Anyway, we can see a pretty similar number of listing among them.

The highlight table above presents the average prices charged only in the entire apartment, regarding the number of rooms in each neighbourhood.

As the number of room arise, the price increases as well, despite to have some outliers. We can also observe as the room’s number and daily prices increase, the apartments offer falls. Besides that, we can realize that almost every neighbourhood has two rooms properties.

Likening average daily price by rooms number, we can realize the increasing of the prices around 27% on average. Still, the highest price difference happens between 1 and 2 bedrooms, when the second is 38% more expensive. It’s possible to find studios with the prices under $100 in Dorchester, Mission Hill and Roslindale. In the other hand, Back Bay, Beacon Hill, Roxbury, South Boston, South End e Theatre District have general prices higher, above $400.

Analysis of Distance Impact on the Price

The neighbourhood distance from Downtown has a significant impact on the average prices. The chart above presents the relation between the average price per day and distance regarding the Downtown area.

The numbers show that as higher the Downtown distance more the prices tend to fall. For comparison, if we take in account places more than 7 km far from the Downtown, the average price per day will be $170 while price charged for properties less than 1.5 km far from Downtown is $245, in average.

Analysing the following chart below we can see the relationship between distance and occupancy rate, in which we can realise an occupancy rate average around 89%, spread along with all neighbourhoods.

It’s noticeable some areas with occupancy far below the average, despite some proprieties being in neighbourhoods closer to Downtown. As these areas have higher prices, likely the guests are more sensitive regarding price than distance.

The next graph explores the relationship among occupancy rate, average price and number of properties per neighbourhood. As we realised from the previous chart before, the average price has more impact in occupancy rate than the distance from the Downtown.

For places that feature prices from $210 to $340 per day, the occupancy rate is 85% and slightly above to 2 km far from Downtown. In places, with prices starting from $138 to around $200, corresponding to 93% of occupancy rate. These areas are just above 8km of distance from the city centre.

Taking the listings number as a reference, we can see a considerable concentration of apartments nearby Downtown. The total of 1528 units, around 78% it’s located less than 4.1 km from the city centre. The remaining 22% of units are more distant, over to 5.7km. As expected, the properties near to Downtown has an average price of $240 and $177 charged for places far from the city centre.

Analysing ratings per neighbourhood, we can notice again, some connection concerning to property distance of the city centre.

Checking specifically the localisation ratings, 39% of the entire neighbourhoods (Financial District, West End, Beacon Hill, North End, Back Bay, South End, Fenway/Kenmore and Downtown) with a score above 98 points are located less than 4.1km from the city centre. Analysing only places with ratings over to 98 points, 78% are under 2Km far from the centre.

Overall ratings and value ratings seem to be more impacted by the price. If we select a range of highest-rated proprieties with value and general ratings above to 95 points (Roslindale, West Roxbury, Hyde Park, Jamaica Plain, Charleston and East Boston), the average price per day in those places is $180.

Most Profitable Areas

Closing the analysis, we will bring some final charts that will show us the most lucrative areas and hence, more interesting for possible investment.

The graph above presents total revenue by neighbourhood, measured from January 2009 until September 2016.

Back Bay, Fenway/Kenmore and South End have the highest total revenues, with respective numbers of $13.6, $10.6 and $9.3 Million. The sum of these values responds for 40% of all total neighbourhood revenue.

For comparison, the fourth-highest revenue neighbourhood South Boston had the total of$5.9Million, 63% less revenue than the South End, the third place.

The chart above brings us the daily revenue by neighbourhood, in which it’s observed that the three areas with highest total revenues, according to the previous graphic, still keep an interesting positioning, especially Fenway/Kenmore and Back Bay.

Those three areas, Back Bay, Fenway/Kenmore e South End have the average daily price, ranging between $222 and $307 per day. Even the lowest value of $222 paid in South End neighbourhood, is above the average daily revenue for all neighbourhoods, at $214.

Here we can see the highest total revenues areas backing to the first positions. Back Bay, Fenway/Kenmore e South End have the highest apartments listings per neighbourhoods, with 220, 200 and 180 units, respectively.

Gathering all three neighbourhoods, we have a total of almost 40% of the whole apartments range in every area, and they have an average of $241 charged daily.

In the localisation rating per neighbourhood, we have Back Bay, Fenway/Kenmore and South End among the best areas reviews, presenting ratings above 98 points from the maximum possible of 100 points.

From a total of 23, only nine neighbourhoods have above 98 points, and just 5 have over 99 points, like Back Bay. Furthermore, Back Bay, Fenway/Kenmore and South End are located, on average, only 3km far from Downtown.

General conclusions

Closing the analysis, let’s review the main insights gathered along with this exploratory search;

Q3 is the busiest period in Boston city. Between July and September, it’s also the most expensive moment to visit the city, translated into the highest prices, reaching almost 31% in September;

70% of hosts and 65% of super hosts have apartments or, among different properties, also have apartments;

70% of guests prefer to rent the whole apartments instead room or shared room and apartments with two rooms has the higher number of listings in the all neighbourhoods range, identifying a possible guests preference for this kind of property;

Neighbourhoods closer to the Downtown have the highest daily prices and total revenue;

Properties further from the city centre has the lowest daily prices. Dorchester, Mission Hill and Roslindale, located 7.7 km far from the Downtown, have options around $100.

Best areas for hosts

Back Bay, Fenway/Kenmore and South End have the highest total revenues, between $13.6, $10.6 and $9.3 Million.

Back Bay, Fenway/Kenmore and South End have, all together, an average daily price of $270, more than 25% above the average paid in all neighbourhoods.

Back Bay, Fenway/Kenmore and South End also have the highest apartments listings, with 220, 200 and 180 units, respectively.

Back Bay, Fenway/Kenmore and South End are among the best localisation rating reviews, above 98 points from the 100 points possible.

I hope you like it! Thanks for reading!

The data used for analysis can be accessed here.