Airbnb can’t go on unregulated – it does too much damage to cities


Remember the “sharing economy”? That rhetoric looks more comically disingenuous than ever in light of the news that a single Airbnb user in Barcelona is managing a portfolio of properties that brings in an eye-watering £33,000 a day in high season. Old neighbourhoods are being overrun with short-term tourists and shops selling souvenir tat. Rents for residents are being driven up, in Barcelona as well as Berlin, New York and elsewhere. Airbnb is a parasitic monster that squats over cities and hoovers up vast sums of money through its slimy proboscis. So what can be done?

Airbnb, short for “airbed and breakfast”, originally sold itself as a way for travellers to stay in people’s spare rooms and get an authentic feel of a foreign culture. This friendly idea is still present in the company’s vocabulary – “hosts”, not landlords, and “hospitality” in place of “business” – even though the vast majority of its listings are now for self-contained apartments or houses. In Barcelona, it used to cost €250 (£221) for a short-term rental permit. Now that such permits are no longer being issued, they change hands for up to €80,000. It’s “sharing” for the rich, maybe, but not for the rest of us.

During their early rapid growth, sharing economy companies started operations around the world without regard to local laws on the basis that existing regulations had not envisaged the radical and disruptive new ideas they embodied. But the tide slowly turned as the whizzy tech rhetoric wore off and it became clear that Uber was in fact a taxi company and Airbnb was in effect a hotel business.

So should we just ban them? No, as they can be useful services and more attractive than the alternatives. The question is how can they be made to behave better. Consumer boycotts, however well intentioned, don’t have the desired effect. The law, however, can. Uber is playing super-nice after Transport for London shocked it last year by refusing at first to renew its licence. So here comes its clean-air plan, involving a 15p-per-mile surcharge on trips to enable its driver to buy electric cars. Regulation works.

The first thing potential regulators need to know, though, is what is actually happening, which is surprisingly difficult since Airbnb keeps its data secret. But enterprising sleuthing can uncover some interesting facts. Tom Slee, the author of What’s Yours Is Mine: Against the Sharing Economy, found that the most expensive Airbnb listing in Rome was one of several luxury rentals bought for the purpose by an American tech entrepreneur.

Meanwhile, the Spanish scholars Albert Arias Sans and Alan Quaglieri in 2016 tested Airbnb’s claims against data from Barcelona to illuminating effect. Airbnb claims its business “revitalises neighbourhoods” – so it is perhaps surprising that “the neighbourhoods with the highest presence of Airbnb are the ones losing population to a larger degree”, which you might think looks like residents being forced out by higher rents.

One answer, some suggest, is for local authorities to be more responsive and fluid in their decision-making. A team of four researchers conducted a close study of Airbnb’s impact on London in 2016, and suggested that every property owner could have the “right to engage in a short-term rental for a given period of time”. These rights could be traded on a market operated by the local council, which would split revenues between local neighbourhood groups and itself. Councils could thus respond to real-time activity to avoid turning areas into hotspots.

In extreme cases such as Barcelona, the only answer might be a clampdown. (It would certainly help if Airbnb could be bothered to pay the €600,000 finethe city levied on it in 2016.) In other places, a more nuanced approach might be appropriate. Many cities now put a cap on how many nights per year a property can be rented short-term and it may be a good idea, too, to cap the number of properties a single owner can list, or limit the number of permits enabling owners to list property in a particular area. The lesson should be that no company is above the law.

In Airbnb’s case, the key to changing its behaviour will be forcing it to be more transparent about its operations. In a 2018 analysis of Airbnb in Australia, the researcher Laura Crommelin and her colleagues argued that the company should make its data about who is listing homes where available to city authorities so they can make informed decisions. After all, if the company really is all about being “open” and “sharing”, what has it got to hide?

 Steven Poole is the author of Rethink: The Surprising History of New Ideas

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