The "Sharing" Economy: Issues Facing Platforms, Participants, and Regulators A Federal Trade Commission Workshop #01045

Submission Number:
Steven Unger
Initiative Name:
The "Sharing" Economy: Issues Facing Platforms, Participants, and Regulators A Federal Trade Commission Workshop
Will the real airbnb please stand up? For the past 3 years I have worked with the City of Portland to implement a short-term rental policy that would appropriately regulate airbnb. After Portland's new ordinance was passed I shared what we had learned and added to it in a BLOG . I have attached a presentation I made in March 2015 to the Oregon Bed and Breakfast Guild at their annual meeting along with a summary slide for city planners. At a high level, my view is that airbnb host-resident "Private Room" rentals are generally benign, help people stay in their homes, and offer true value to the traveling public. I call this the "good" airbnb. This is the part of airbnb that airbnb talks about. And airbnb encourages "Private Room" rental hosts to speak at public hearings. On the other hand, airbnb host-absent "Entire Place" rentals create the airbnb horror stories, irritate neighbors and reduce housing stock by converting long-term (month-to-month) rentals to short-term transient lodging. When host-absent "Entire Place" rentals are offered on an on-going basis these are really just vacation rentals. I call this the "bad" airbnb. "Entire Place" rentals hosts almost generally will not testify at public hearings, especially if they have multiple listings. In cities like San Francisco and New York City where there is a hyper-inflated real estate market, a housing shortage, and a predominance of apartments and condos, the impact of airbnb host-absent "Entire Place" rentals are particularly toxic. airbnb "talks the talk" about wanting reasonable regulation and working with cities, but in practice does not "walk the walk". For example, Portland, Oregon has a requirement that all online listings need to display a permit number. airbnb could easily display only listings with permit numbers. The just refuse to do so. Also, Portland and San Francisco have new ordinances that limit host-absent "Entire Place" rentals to 60 nights a year. Again, airbnb could implement this limitation in their software, but refuse to do so. This leaves cities with little choice but to require airbnb to provide them with the otherwise hidden host name, address and phone number. Again, airbnb refuses to do so. airbnb presents itself as a humble home sharing service, but in reality it is a mega corporation. Airbnb requires guests to pay when the reservation is made an pays the host after the guest arrives. Airbnb earns interest on the guest's money for the days, weeks and months between booking and arrival. While this is perfectly legal and a highly effective business strategy, it is a traditional form of profiteering and hardly an example of the "sharing economy". Cities have traditionally protected neighbors and the travelling public by regulating shot-term rentals whether they be hotels, bed and breakfasts or vacation rentals. Depending on the city, fire and safety inspections and liability insurance may be required. The collection of a lodging tax is also often required. While airbnb has taken steps in some cities in some of these areas it has a very long way to go. In many cities airbnb encourages and profits from illegal short-term rentals. This is why I ask "will the real airbnb please stand up"? Steve Unger, Innkeeper and Editor of The airbnb Analyst BLOG and [REDACTED]