Making a Fortune With Airbnb? It May Not Last

Making a Fortune With Airbnb? It May Not Last

Since its inception Airbnb has taken off. Thousands of people around the world have a found a listing or rented out their own homes and made plenty of cash doing so. But the waters seem to be changing. Many people are unhappy with Airbnb and their operations. Those who have previously made plenty of money through the website, may need to start tightening their belts as new laws and legislations are currently being drawn up to stamp out this crowd sourcing practice once and for all.

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Airbnb now has over 1,500,000 listings in over 34,000 cities and 190 countries. The company boasts the ability to let you stay in unique locations, such as ‘igloos and castles’, while being hosted by friendly locals. Airbnb was founded in 2008 and its headquarters are situated in San Fransisco, California. It is privately owned by Airbnb Inc.

It is an incredibly simple way for people to make money. If you have space to rent in your home for a short period of time, and want to make some cash with it, you can easily sign up with the website and get in touch with many people who want to rent in your location for short stays.

Through studies conducted regarding the impact of Airbnb on local economies, there is evidence to show that economies are actually boosted. Guest stays are estimated at 5.5 days compared to 3.5 in conventional hotels. They are also more likely to spend more money in local businesses.

What Has Changed?

When Airbnb first took off it went largely uncontested and many users of the website reaped the benefits of finding cheapProp F accommodation and earning some cash by renting out their rooms and apartments. In 2010 however, New York’s state legislature made it illegal to rent out a Class A residential space for less than thirty days. Though it was stated that this was not directly targeting Airbnb, it certainly made a hit with users of the site.

Not to mention the legal problems that have started to come to the surface. Over 190 countries are using Airbnb, and each country and regions within each country have their own laws for renting and subletting, their own taxation rules that can be overlooked and downright ignored when it comes to renting out your place with Airbnb. Whether renters on Airbnb are legally landlords or inkeepers is still up for debate, and either way, many have been bi-passing fees and regulations by ignoring the laws in their locality. Governments and regulatory authorities are now attempting to crack down on this and force Airbnb and its users to pay attention to the laws and pay up when it comes to taxes. The company is having to deal with an onslaught of problems beginning with local authorities and governments creating new laws to prevent them taking possible profits and opportunities from needy people and hotels in the area.

New York City

While New York councilmen and women have called for serious fines on what they term as Airbnb’s ‘illegal hotels’. Though the company claims to support serious reprimands for those abusing their company name, they also feel that the enormous fines would harm their legitimate renters as well, but council officials were not buying it. Critics of the company say that the company adds to the affordable-housing crisis in New York and elsewhere, renting homes to tourists rather than locals who need homes. Numerous protests have been held across the country by housing committees and locals to get rid of Airbnb from their towns and cities.

Many renters have a monopoly on a lot of areas and rent out numerous properties to turn a larger profit. Add this to the not numerous, but still significant complaints that have been made by renters who use Airbnb, and have had their properties damaged. One user’s property was used for a continuous party and damages of up to 50,000 dollars was done. The company has been criticized for its handling of these sorts of complaints and in some cases has not given renters compensation for their troubles or has given unsatisfactory customer service regards these matters.

San Fransisco

And this year in San Fransisco, the company’s hometown, a group of homeowners, neighborhoods, and advocates for tenants Prop Fcollected over 200,000 signatures to instigate Proposition F, which would severely crack down on the business of Airbnb and require users to submit reports on when they were living in the properties and make it a misdemeanor to unlawfully list a house as a short term rental. This was after concerns were raised that none of the properties listed on Airbnb are properly checked for safety or fire hazards, and with no background checks on renters, and the ability to create a rental profile on the site with unbelievable ease. Airbnb countered these claims by assuring critics that they operate on a ‘gold standard’, yet are unable to show any evidence of such a standard. Lately, due to Airbnb spending over $8 million to oppose the proposition, protestors’ efforts were largely ignored by voters and Proposition F was not voted in.

If Airbnb are to become a reputable company they need to work with local authorities and communities, set up real guidelines and regulatory systems to protect locals, local businesses, and renters alike, and in general just start giving a damn.

The Airbnb method has made many people a lot of money in the last eight years, but at what true cost? New complaints and taxation laws seem to be turning the tide for the multi-billion dollar company. This doesn’t yet look like the end of crowdsourcing places to stay or the company itself, but the belts will be tightened. It could also mark much tighter margins for eligibility on the site and could possibly mean that renters are required to brush up on their local renting laws before setting up an account. Either way it’s important to know what your rights and obligations are before beginning to use or continuing to use the site.



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