Amid growing concerns about climate change, the topic of sustainability in travel is often at the centre of public debate. Air travel, tourism and short-term rentals are frequently blamed for environmental degradation and community displacement. While some of these concerns are valid, the conversation deserves far more nuance. Unlike most industries, which tend to focus on one specific area (e.g. aviation, food security or the local community), tourism is at the intersection of many areas where the lines aren’t so clear-cut.
As highlighted in a recent Forbes article by Emese Maczko, flying can serve as a catalyst for sustainable innovation, and tourism (especially in its decentralised, local forms) can bring essential benefits to communities.
Let’s have a closer look at how short-term rentals, travel and tourism and can be part of the solution rather than the problem. Instead of accepting emissions at face value, let’s consider the consequences of not having the luxury of travel, and how it’s not just about reducing travel, but also about adapting and retrofitting to the new era.
Air Travel Drives Innovation and Economic Development
While critics of air travel often focus on emissions, especially with short-haul flights, the industry’s active transformation in response to pressure is often overlooked. Airlines are accelerating the adoption of sustainable aviation fuels (SAFs), modernising their fleets and investing in direct air capture and carbon offset programmes.
However, progress is happening, albeit slowly. According to the International Air Transport Association (IATA), SAF could reduce aviation’s carbon emissions by up to 65%, and over 450,000 commercial flights have already used SAF blends as of mid-2023. They may be under great public scrutiny, but increasing pressure on this active area of research will set the bar for how we move in the future and pave the way for sustainable aviation.
At the same time, aviation continues to play a vital role in facilitating trade and connectivity, as well as promoting tourism development, particularly in countries where overland infrastructure is limited. Disrupting this mode of transport would not only hinder innovation, but also harm regions that depend on tourism for employment and investment. Another factor, often overlooked, is the positive impacts of tourism on local wildlife conservation and the prevention of the poaching and hunting of local animals. While isolated incidents—such as the case of a US influencer who notoriously removed a baby wombat from its mother in Australia for social media content—can attract criticism and raise legitimate concerns, they are not representative of the broader role that tourism plays. In most cases, travellers are drawn to the natural and cultural richness of a destination, and tourism efforts often aim to preserve, not exploit, what makes these places special.
Tourism Spreads Income to Regions That Need It Most
Tourism is frequently criticised for concentrating its benefits in a few major cities, with visitors unaware of the needs of the land and culture. However, current data reveals a different trend. According to a 2024 report from Oxford Economics, short-term rentals (STRs) generated an economic impact of €149 billion in the European Union in 2023, which has supported 2.1 million jobs, where over 50% of these stays occurring outside major urban areas. This influx of wealth beyond the major cities has enabled tourist wealth to be distributed more widely to smaller towns and rural areas, which would otherwise be vulnerable to economic stagnation, particularly in Europe.
This shows that short-term rentals (STRs) provide a way to tap into tourism demand without building new infrastructure or displacing communities, as they offer decentralised lodging options. This positive externality is often hidden and taken for granted in travel. Recognising it enables us to gain a more balanced view of how tourism can benefit local communities.
Short-Term Rentals (STR) Empower Residents and Local Economies
To highlight this positive aspect further, In the United States, STRs have proven to be a valuable source of income for both municipalities and individual residents. In 2024, Airbnb reported that its platform alone had contributed $90 billion to the US economy, supported one million jobs and generated over $25 billion in tax revenue.
Interestingly, studies have shown that guests spend roughly half of their expenditures on goods and services in the same neighbourhoods as their accommodation, thereby supporting the local economy and suppliers. Here, at Sustonica, we account for this positive side effect, which forms one of the many criteria within Sustonica’s framework for creating a sustainable dwellings globally.
Let’s not forget that, moreover, short-term rentals provide a significant source of income for many hosts. According to an Airbnb report, 64% of U.S. hosts reported using their income to cover rising living costs. In Connecticut, for instance, STRs contributed $306 million to the state’s gross domestic product (GDP) in 2023, while also helping residents manage inflation and mortgage costs.(CT Insider).
The Housing Impact of STRs: A Manageable Challenge
There is no denying that short-term rentals can affect housing availability in certain contexts. For example, a widely cited study published in Regional Science and Urban Economics (Barron et al., 2020) found that a 1% increase in Airbnb listings is associated with a 0.018% rise in rents and a 0.026% rise in house prices across U.S. cities. While these percentages may seem small at first glance, they suggest that as the number of short-term rentals grows, even modest increases can have a cumulative effect on affordability. For instance, in a city with an average rent of $1,500, a 0.018% increase translates to about 27 cents more per month. However, if Airbnb listings increase by 20% over time, the resulting impact could add several dollars to monthly rents and hundreds to property prices. This illustrates how the expansion of platforms like Airbnb may gradually contribute to upward pressure on housing costs, particularly in high-demand areas.
However, the impact is far from uniform. In housing-constrained urban centres like Barcelona or Athens, over-tourism and excessive STR concentration can contribute to gentrification and displacement of local culture and infrastructure. This is called ‘Overtourism’ and is an existing, yet manageable concern, and as we shall see can actually be a positive force to encourage local development.
In response, numerous cities have taken action: Madrid recently closed 10 illegal tourist flats following resident complaints of unsanitary and unsafe conditions (The Guardian). Greece has frozen new STR licences in central Athens, aiming to reduce pressure on the housing market (AP News). Barcelona has pledged to eliminate STRs by 2028, citing concerns about affordability and quality of life (The Times).
Overtourism is also present in Japan, which has experienced its busiest period in recent years, with ‘record-breaking’ numbers in May 2025, in the middle of the infamous cherry blossom season. However, Japan has responded by introducing guidelines to promote a more balanced tourism experience that honours both the local area and the lifestyle of its residents. These include encouraging timed entries to local attractions, imposing fines for entering restricted areas, and distributing tourist wealth to less popular areas. The country has seized the opportunity to improve public transport and reduce congestion, demonstrating how increased pressure can lead to better infrastructure for tourists and locals alike.
These actions suggest that the issue lies not with STRs themselves, but with their concentration and poor regulation in certain contexts. They also highlight how constructive management can create a win-win situation for all parties involved. If managed appropriately, STRs can remain compatible with affordable housing policies and even support them through tax contributions.
The Impact of STRs: Paving the ways in Retrofitting
Our recent webinar highlighted one of the most sobering facts about short-term rentals:
80% of the buildings used for STRs today will still be standing in 2050.
These buildings cannot simply be replaced with sustainable alternatives; they must be transformed through retrofitting, which involves upgrading appliances, improving infrastructure and fostering habits that benefit people, property owners and the planet.
While this shift is undoubtedly driven by sustainability, it also represents a smart long-term strategy for ensuring business viability, creating lasting value, and respecting existing assets. Short-term rentals (STRs) naturally follow a product-as-a-service model, emphasising regular maintenance of appliances and properties instead of disposal. This approach helps to ensure that the property remains competitive in the market and that guests have a consistently high-quality experience.
By setting new, desirable standards for how we live, more consciously and responsibly, the STR industry can lead the way. This transformation occurs when infrastructure, culture and everyday behaviour come together to model a better way of living.
At Sustonica, we believe that helping people to adopt better habits within their current means and realities is essential to real progress. That’s why one of Sustonica’s many criteria focuses on upgrading properties to make sustainable choices more accessible and actionable for both hosts and guests, and meeting them where they are at.
A Blueprint for Responsible, Sustainable Travel
The solution is not to stop people from flying or using short-term rentals. Rather, the focus should be on regulation, transparency, and community alignment. The World Travel & Tourism Council (WTTC) has developed a framework for integrating STRs into local planning. This includes data-sharing agreements, zoning restrictions, capped nights, and taxation mechanisms that ensure hosts contribute to public services and housing development (WTTC, 2023). This means that, despite the tourists who come and go, investments and resources will be directed towards the local communities they visit.
In parallel, travellers themselves are evolving. According to Booking.com’s 2023 Sustainable Travel Report, 74% of global travellers say they want their travel to be more sustainable, and 43% are willing to pay more for accommodation with sustainability certifications (Booking.com). This change in demand is pushing property owners, airlines, and tourism businesses to adopt greener practices, from reducing energy use to promoting local food and culture.
Tourism in Perspective: How Its Climate Impact Compares to Other Global Industries
While tourism is often singled out in climate discussions, it’s important to place its impact in context of other industries. The aviation sector, for instance, contributes approximately 2.5% of global CO₂ emissions, a figure that includes both leisure and business travel (Our World in Data). In contrast, the fashion industry is responsible for an estimated 10% of global emissions (UN Environment Programme), while food production, particularly industrial meat and dairy, accounts for over 25% of global greenhouse gases (UN Environment Programme).
These figures highlight the need for a more balanced public discourse. Unlike many extractive or high-emission industries, tourism has the capacity to directly benefit local communities, incentivise environmental conservation, and foster cross-cultural understanding – outcomes that are nuanced and difficult to replicate in most other sectors.
Travel as a Force for Good
Flying, tourism and short-term rentals do not necessarily undermine sustainability in travel. Instead, they serve as a litmus test for how far industries such as aviation, food systems and infrastructure still need to go to become truly sustainable. These sectors converge in tourism, creating a perfect storm that reflects the combined environmental and social impact of many industries.
When managed thoughtfully, however, tourism and short-term rentals can become powerful enablers of sustainable transformation. They reveal points of friction in the system, some of which are easier to change than others. Just as the aviation sector has driven innovation in clean technology, tourism helps to redistribute economic opportunities, particularly in regions outside wealthy capital cities and advance travel infrastructure in others. This would involve experimenting with ways to work with the people and planet rather than against it.
Short-term rentals, in particular, provide households with income, support small businesses, and create opportunities to revitalise under-visited regions.
The challenge lies not in rejecting these sectors, but in reshaping how they operate and the impact they leave behind.
While blanket restrictions or stigmatisation may offer short-term political appeal, they risk harming the very people and places that sustainable development aims to protect. A more constructive approach would be to regulate wisely, invest in data and align incentives so that travel continues to enrich lives, of both tourists and locals, without undermining the planet.
It isn’t a matter of choosing one at the expense of the others, but about knowing how to couple both to set a new and improved standard of living. After all, isn’t that what going abroad is all about?
Collaborative article written by Dr. Camilla Pang and Delphine Darja Hurter
