Yahoo Finance Bay City rollers: Airbnb vs. San Francisco
Airbnb is in a fight with the City by the Bay….over real estate.
San Francisco officials are accusing the alternative accommodations company of adding to the housing crunch there.
A report done by the city and county Board of Supervisors concludes that approximately 14.8% of the available rental properties in San Francisco are being kept off the market so owners can use them for short-term rentals through firms such as Airbnb.
But the company is lashing back, claiming it’s the board’s policies that are to blame for limiting housing in the city. And in a statement to Yahoo Finance Airbnb says it’s actually HELPING San Francisco’s homeowners:
Home sharing is an economic lifeline for thousands of San Franciscans who depend on the extra income to stay in their homes.
Yahoo Finance Editor-in-Chief Andy Serwer says this kind of conflict is bound to happen as governments have to deal with more and more “new economy” startups.
"Airbnb is a huge disruptor, not unlike Uber, and it’s just shaken these worlds, the markets, the regulators,” he argues. “People don’t know how to respond.”
However, the report is offering up suggestions on how the San Francisco Board should respond:
Enact legislation requiring hosting platforms to provide host address information and booking information on a quarterly basis for enforcement purposes.
Enact legislation requiring hosting platforms to only list units and hosts that are registered with the City.
Enact legislation limiting the number of un-hosted nights allowed per year.
Amend the Planning Code to allow the Planning Department to levy fines on platforms that list unregistered hosts.
But Serwer believes it’s going to be tough for city officials, since they’re wading into uncharted waters.
“We know some neighborhoods don’t allow renting, some buildings don’t allow condos and co-ops, but this is a whole new ball of wax,” he points out. "All of a sudden you can turn your home into a hotel, into a hostel, you can rent out some bedrooms. What does that mean for zoning? What about the neighbors-- what do they think? So you have jurisdictions scrambling to keep up with this stuff. That’s what’s really at the heart of it.”
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Peter Kenny, chief market strategist at Clearpool, says the booming tech economy in the area means the demand for housing isn’t going to ease anytime soon.
“San Francisco’s housing market-- based on how you measure it-- is either number one or number two in the country in how much demand there is and pricing per square foot,” he explains. “That’s not going to change. In fact, it could get worse before it gets better, primarily because the economics behind the San Francisco market are significantly more stratified than they were before.”
Yahoo Finance’s Lauren Lyster notes one of those Bay Area “new economy” firms and Uber rival, Lyft, is getting some big financial help just as the Airbnb-San Francisco battle heats up.
“Carl Icahn has invested $100 million in that company,” she points out. “Another of these startups, ride sharing, sharing economy kinds of things.”
And that plays perfectly to Serwer’s earlier point about Airbnb and the others.
“Carl’s a disruptor,” Serwer explains. “He likes to disrupt things.”
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