Student Developments Driving Out Coventry's Businesses
20th Jul 2018
One man's hero is another's villain. This is certainly the case for Airbnb, the global lodging website that launched in 2008 and has since taken the world by storm - an Airbnb guest checks in somewhere in the world every two seconds! But it turns out that disrupting the holiday letting market to the extent they have has more than ruffled the feathers of authorities and local businesses the world over who are quick to attack the site's impact on their local communities.
Early off the blocks was New York. Whilst renting out your property to others does not itself constitute a legal breach, it does risk falling foul of housing laws and regulations. In the city that never sleeps, one cannot legally rent their apartments out for periods of fewer than 30 days, unless they are cohabiting the property. Beyond this, there are also a number of tax issues that come with the activity. In many cities, short-term renters of any form of "holiday accommodation" are expected to pay hotel or tourist tax.
In the company's home city of San Francisco, the website is also under fire, where all short-term residential rentals are banned without applying for an expensive permit. In extreme cases, a number of tenants who have used Airbnb to rent their apartment have subsequently been faced with eviction notices. In the latest attack, Airbnb has been fined 30,000 EUR in Barcelona for allegedly breaching local tourism laws that state any flat rented to tourists must be filed with the Tourism Registry of Catalonia.
But it's not all bad news for the site. A number of major cities and countries have shown growing support for the practice of short term rentals to tourists. This list includes Amsterdam, France and the UK. Eric Pickles, secretary of communities and local government said, "the internet is changing the way we work and live, and the law needs to catch up".
Conventional hotel businesses have been quick to strike out against the practices of Airbnb, however, their defence is weak, at best. Following major calls that the website was ignoring tax laws, Airbnb have begun to collect hotel tax on behalf of the host. The company plans to roll out this functionality location at a time as it gets to grips with local rules and laws.
In April, the Economist forecasted that at current growth rates, Airbnb will be taking a 10% share out of the hotel industry's takings as soon as 2016. One would assume that Airbnb will find a suitable solution to dealing with local tax rules the world over. When they do, hotels will have to address the more pressing point that Airbnb are simply providing the world with a solution that it wants and is consuming in it's masses. The sooner they learn this, the better.
20th Jul 2018
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