Revenues are down nearly 50% in cities like Phoenix and Austin.
Watch out for a wave of forced selling from Airbnb owners later this year in the areas hit hardest by the revenue collapse.
1) What's scary for the US Housing Market is just how many Airbnbs there are.
Data from AllTheRooms shows 1 million Airbnb / VRBO rentals.
Compared to only 570k homes for sale.
Creates huge home price downside if struggling Airbnb owners elect to sell.
2) Ground zero for this Airbnb collapse is a city like PHOENIX.
Where the number of short-term rentals (18k) is more than DOUBLE the number of for sale listings (8k).
Mix the huge Airbnb supply with revenues down -50% and you get a cocktail for massive forced selling.
3) Another area with huge exposure is Eastern Tennessee.
Particularly a vacation town called Sevierville in the Smokey Mountains.
In this county there's 10x as many Airbnbs as homes listed for sale. While the revenue per owner is down nearly 50%.
Yikes.
4) Another area to watch out for is Central Texas.
Data from AllTheRooms shows that Airbnb revenues are down 40-50% yoy across most of the area.
Particularly in Austin, San Antonio, Uvalde.
5) Another area that is getting smoked by the Airbnb Crash is the Pacific Northwest / Mountain Region.
States like Montana, Idaho, and Oregon.
Fewer people playing out their Yellowstone fantasies + way more supply = 40% declines in revenue per listing.
6) And ultimately this Airbnb crash was to be expected.
The pandemic is over. Fewer people are working from home / vacationing in states like Montana, Texas, and Tennessee.
So the demand is way down. Just as the Airbnb supply went way up. So you get a crash.
7) What will be interesting is how "stubborn" Airbnb owners are in holding their properties.
Many of them are just now seeing their revenues down 50%.
But the mainstream narrative hasn't caught up to it yet. So owners might not realize the Airbnb crash is a broader trend.
8) Some Airbnb owners might elect to do a long-term rental in their properties instead.
But the problem with that is that there has already been a huge surge in long-term rentals hitting the market.
With vacant rentals in cities like Nashville exploding over the last year.
9) So if Airbnb owners "pivot" to long-term rentals, they'll likely crash that market as well.
Especially in dense urban areas. Which is where the majority of Airbnbs are located.
Check out the Airbnb heatmap in a metro like Phoenix to see areas with most exposure.
10) I think "newbie" Airbnb owners who bought over the last 1-2 years with a mortgage are in trouble.
They got in at a high price. And have a high monthly payment. And little margin for error.
They could be some of the first to sell later in 2023 when the season ends.
11) However, some of the more seasoned Airbnb operators who got in before the pandemic likely have room to work with.
They paid less for their Airbnb. Have a cheaper mortgage rate. And more experience.
They will be less inclined to sell.
12) I'll have more content and data on the Airbnb crash in coming weeks.
The data used in this Tweet thread came from AllTheRooms. They're a short-term rental data provider who tracks Airbnb supply, rates, and revenue for every market in the country.
The biggest problem in today's housing market is not mortgage rates.
Rather - it's homeowners clutching onto an unsustainable amount of homeowner equity.
Today, homeowners have over $34 trillion in equity on their houses - more than 2x higher than the 2006 bubble.
It's the biggest homeowner equity bubble ever. And it's keeping hard-working Americans locked out from buying a house (because prices are too high).
Sellers who come to market today are often refusing to cut the price to the market-clearing price, and even de-listing their homes. This is further perpetuating the worst housing affordability crisis we've seen in 40 years.
The solution: home prices need to correct, by around 15-20% on a national basis, to bring the market back into balance with homebuyer incomes and interest rates. This type of correction will not be that damaging to the economy, since most homeowners would still have plenty of equity. (in this scenario, homeowner equity would drop to around $25 trillion - still almost double 2006).
It's important that lenders, realtors, investors, and government officials understand that unsustainable prices and homeowner equity levels are what is creating the worst home sales transaction market in decades.
Not mortgage rates.
1) For perspective, today's homeowner equity levels are north of 115% of GDP, the highest level of all-time.
Indicating that home prices and equity growth have far outstripped the growth of the economy, incomes, and inflation.
It's not sustainable, and needs to correct.
2) There's a whole host of reasons why this happened, the most obvious being Fed manipulation of the interest rate cycle over the last 20+ years.
Starting with the Fed Chair in 2001, the Fed became overly accommodative, lowering interest rates well below the rate of inflation.
Nashville's housing market was previously one of the biggest boom markets.
Now it has one of the biggest gluts of unsold inventory of any metro.
With nearly 11,000 homes for sale, the highest level in almost 10 years.
Nashville's inventory surplus is now at 62.7% above the long-term average. Indicative of a market that is in correction.
1) Home values in Nashville dropped -0.18% in June 2025 every month.
And the year-over-year value metrics in Nashville are now essentially flat, at +0.1% June 2024-25.
At Reventure, we are forecasting a -7.2% over the next 12 months.
2) The true story in Nashville is a normalization in demand to go along with a pandemic boomerang effect that is resulting in quite a people who moved to the city during the pandemic now selling their houses.
Of course - there is also a lot of new construction, of both houses and apartments, that is putting downward pressure on the market.
Home builders have 9.8 months of supply on their lots.
Has only happened 6 other times in U.S. history.
5 times it led to a recession.
1) Long-term median Months of Supply is around 5.8 months.
Meaning today's home building market is 70% more oversupplied than normal.
2) Months of Supply takes the number of homes builders have for sale, and divides by monthly sales volume, giving a relative indicator of demand.
The data is sourced from the U.S. Census Bureau, which has been tracking builder Months of Supply for over 60 years, making it one of the most consistent and reliable indicators of home building activity.
Home prices in the U.S. are 16.5% overvalued in 2025.
This is a higher level of overvaluation than what we saw at the heights of the 2006 bubble.
After that last bubble, prices became undervalued, and the period from 2008-2019 was a great time to buy a house.
However, today the market has become too expensive, with home prices outpacing wage growth.
The result is an overvalued and unaffordable market.
This is the main reason why homebuyer demand is so low in 2025. Fix the overvaluation, fix the homebuyer demand problem.
1) This overvaluation data is based on the relationship of Home Values and Incomes in the U.S. Housing Market.
Home prices during the pandemic went up way faster than incomes, pricing out homebuyers, and resulting in the highest overvaluation we've seen in decades.
2) The median household in the U.S. earns around $83,000.
While the annual mortgage payment to buy a house is $33,000.
WIth the resulting payment/income ratio close to 40%.
That's simply too expensive for first-time buyers.