We agree that regulation is important for any sector, however, the impacts of this bill, as presented, are far wider than they may appear at first blush. While it is easy to say "I don't run an AirBnB, this doesn't matter to me," this view fails to account for the impact these small vacation-rental units (and the services they provide) have on the wider local economy.
To help people get their hands around the numbers, we present the following key points (each point is justified in the 'Showing Our Working' sections).
Short-term rentals are responsible for approximately 16% of the GDP of Barbados and a similar percentage of jobs (direct, indirect and induced effects).
Short-term rentals generate over a $1,000,000USD per day (on average) in direct on-island spending. This is based on data from BTMI that is likely outdated, and the actual number is likely substantially higher today.
Based on Government estimates this (very conservative estimate of) spending would be distributed within the local economy as follows:
$160,000USD/day - meals and drinks ($116.8M BBD/year)
$80,000USD/day - entertainment and recreation ($58.4M BBD/year)
$70,000USD/day - transportation ($51M BBD/year)
$70,000USD/day - shopping ($51M BBD/year)
$30,000USD/day - souvenirs ($21.9M BBD/year)
Short-term rental guests tend to spend more off-property and short-term rental operators tend to pay higher wages.
Unlike major hotel chains, the vast majority of foreign-exchange generated by short-term rental properties stays in Barbados.
Short-term rentals significantly expand bed capacity, spread spending into communities, and generate hundreds of millions USD annually in direct visitor spend, with knock-on effects across restaurants, bars, shops, taxis, tours, and maintenance services. With a multiplier of ~1.7–1.8×, STR activity amplifies total economic impact, consistent with tourism’s ~31% share of GDP. Rather than displacing hotels, STRs complement them by diversifying product offerings and broadening benefits to micro and small enterprises island-wide.
The UNDP estimates that 31% of Barbados's total GDP and 33% of all jobs on the island is derived from tourism (direct, indirect and induced). Source (pdf)
In 2023, BTMI reported there were 637,000 stay-over tourists who visited Barbados. Source
BTMI also reports an average guest stay of between 9 and 12 days. Source (BTMI report archives)
Official government statistics from 2023 place the number of hotel rooms at 5,757, with another roughly 1,200 rooms coming from registered apartments and guest houses. Source
While no official report from government exists for the short-term rental space (which is, in and of itself, somewhat inexcusable to be missed before legislating the sector), independent industry research (Terra Group) places the number of short-term rental bedrooms at over 13,000. Source. While there will be obvious overlap between this number and the roughly 1,200 rooms mentioned in point 3, it should be exclusive of the hotel room count from the same point.
Based on those 5 simple points above, we can do some very basic calculations to see what the impact and importance of the short-term rental market is to Barbados and its economy:
Total stay-over tourists: 637,000
Average stay: 10 nights (the mid-point of the BTMI estimate)
Total nights requiring accommodation: 6,370,000 guest nights
Hotel capacity: 5,757 rooms
Average number of nights in a year: 365
Total available guest nights at hotels: 2,101,305 guest nights at single-occupancy and 4,202,610 guest nights at double-occupancy.
While no hard data exists on the percentage of bookings that are double-occupancy within the hotel space in Barbados, industry estimates for the larger region place the figure at 70% double-occupancy. Using this number, we arrive at an available inventory of hotel room furnished guest nights of 3,572,218.5; this is 2,797,782 guest nights short of the total demand for accommodation in Barbados in 2023. Expressed as a percentage, 43% of tourism revenue would vanish from Barbados should short-term rentals not exist and function.
It should be noted that the above is also a very naive approach to the calculation, not accounting for seasonality. When accounting for seasonality, an argument can be made that removing or severely limiting the short-term rental market would remove more than 50% of the tourism revenue from Barbados, or approximately 16% of our entire GDP, and a commensurate number of jobs.
If ~35% of 2023 stay-over nights occurred in STRs, STR visitors would account for US $365–430 million in direct on-island spend (US $183/day × 10–12 nights × 223,000-267,000 STR-equivalent visitors).
Truth be told, we don't have much working to show for this section. We simply applied the percentages from the Government's Tourism Master Plan 2014-2023 that can be found here.
Villas and short-term rentals employ between 2,000-3,000 Bajans directly and pay wages roughly 30% higher than hotels for similar work. Source
STR guests tend to spend more off-property (as would be expected, as there are few to no 'all-inclusive' short-term rentals Source (BTMI archive). This provides more support for the spending estimates made earlier being conservative, as they are based on a blended average.
STR guests also tend to spend more on transportation (rental cars, taxis) and tours by the nature of the decentralized location of many short-term properties, not all of which are located on the transportation corridors along the coast.
Terra Caribbean estimates that >99% of operating expenses for short-term rental properties are paid on-island and in local currency. Source
Short-term rentals will often purchase furnishings, building materials, linens, etc., locally, while several large hotel chains take advantage of their duty-free concessions to ship in items of this nature. While this is already unfair to the smaller operators, it is even more unfair to the island of Barbados as a whole, and an argument can be made that the local economic impact of a single short-term rental room substantially outpaces the local economic impact of a large chain hotel room.
Additionally, many large hotels receive and process their funds through accounts that are not on the island; Barbados never sees the full foreign exchange generated by these facilities.