The Problem with Airbnb

Airbnb has been in the spotlight a lot lately for a variety of reasons, and those within the B&B community seem to either be very for, or very against them. The big issue seems to be the fact that those who rent illegally prefer to post on Airbnb for some reason, most likely because Airbnb has become a popular site for travelers, meaning postings on Airbnb get a lot of exposure.

As we use Airbnb to get bookings for our property GringoWasi, I have taken an interest in this and so far, I cannot find any problems with the way that they operate. Some of the other property owners on the LinkedIn discussion groups feel that Airbnb is responsible for the illegal renting problem, so let’s discuss some of these points.

The main point that most people seem to cling to is that Airbnb is breaking the law by advertising these illegal properties, but to the best of my knowledge there are now laws against advertising. Let’s assume for a minute that I posted an add in a newspaper or other source, that I had cocaine for sale, while this might cause the authorities to come knocking on my door, unless they actually found cocaine I would not have broken any laws. This is of course an extreme example and I really doubt that I could place an ad like this as the ad would be for a blatantly illegal product.

A much better comparison would be with the Illegal prostitution in Las Vegas. All around the strip and downtown you will find magazines that advertise strippers that will go straight to your room, the problem here is that often times these ads are placed by prostitutes as a way to get business. Is the Publisher liable for these ads? No, as long as the ad is placed for a legal activity (stripping) they have no idea if the purpose of the ad is for legal or illegal use, as such they cannot be held liable for the actions of those placing the ads.

So when someone posts an ad for a property on Airbnb, Airbnb has no way of knowing if the property is operating legally and within its local laws. They do however have a paragraph that posters are supposed to acknowledge they have read, this paragraph notifies the poster that they are responsible for knowing, and are operating according to their local laws. This is the same thing that you find on other sited like Booking.com, Hostlebookers.com and other such posting sites, so in my opinion they are following standard industry practice.

Then there are those that like to say “Wait until states create laws requiring Airbnb to provide information”. The problem with this statement of course is that fact that any state only has jurisdiction within its own borders. Considering Airbnb is based in California, I believe that is the only state that could force them to do anything.

Next there is the issue of cooperation; I am constantly hearing that Airbnb should hand over customer information to the local agencies, the problem here of course is that there are privacy laws that must be considered, Airbnb can’t just hand over everyone’s personal information. They actually did just recently provide New York with a list of listings within New York, the catch here is they have assigned an individual code to each listing to avoid disclosing any personal information. If any addresses are found to be operating without proper licensing, Airbnb will provide the owner information for that listing, sounds like a good plan to me.

Airbnb actually appears to be interested in solving this problem, as they are not only working with New York, but they are currently working with the state of Oregon as well. With Oregon they are working on a way to actually be able to collect the rental taxes from the guest, and then transfer them to the state. This I believe will ultimately be a good thing for the industry as it will require those posting rentals to provide a tax ID, which should ultimately ensure they are operating legally.

As I see it, the only real problem with Airbnb is their popularity; because of this they have captured a large portion of the market in a fairly short period of time, which has exposed a weakness in the on-line availability of rentals through sources like Airbnb, Booking.com, and other on line booking systems. The weakness I am referring to is the inability of these sites to validate the legal status of those posting the ads, basically anyone with a room to rent, legal or not, can post an ad on any of these sites. Yes Airbnb also has categories for a much larger range of rentals than any of the other sites I have seen, but just because you can list things that may not be legal in some places like an Igloo, Cave, Treehouse or even an Island, this does not mean that they are not legal someplace else, and remember, Airbnb offers rentals worldwide and besides, who wouldn’t want to stay in a Yurt.

So while there are those in the industry that see Airbnb as pure evil, I think they are a pioneer in the travel industry blazing a trail that others will ultimately follow. Yes there are going to be some bumps that they will have to work through, but their willingness to work with New York and Oregon to resolve some of these issues is encouraging, and I believe will ultimately aid in reducing illegal rentals.

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About Lyle

I love travel and currently own and operate a Bed and Breakfast called GringoWasi with my beautiful Peruvian wife, the property is located in the small town of Huarocondo, and about 30 minutes West of Cusco Peru.
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