Just how revolutionary is AirBnB?


To believe the hype one would have to agree that AirBnB is changing the lodging world. It is the sharing economy, with individuals finally able to participate rather than only large companies offering up lodging. And then there are the two stories I read in the past week or so which call that into question.

First up is the tale from San Francisco where a long-term houseguest is claiming that they were unduly evicted from a room. The short version is that after 70+ days of staying on the property, with bookings ranging from 1-5 days at a time, the guest was evicted after falling behind on her rent. And now she is claiming that she was unduly removed from the property outside the scope of San Francisco and California tenant laws. Is it just the sharing economy, or should she have been counted as a guest with a lease? Of course, AirBnB is suggesting that the laws don’t cover this “new economy” type of arrangement, though it is not entirely clear why they feel that way other than that it is beneficial to them.

The second story is more of data analysis on exactly who is renting out what types of units to whom. And in big cities it seems the answer is decidedly less “sharing economy” than not. The numbers suggest that while many hosts are, in fact, normal people renting out their apartment or a room in it that’s not the whole story. Many more rooms are rented by people who have multiple listings (55% across the data set) and 44% of the total revenue is coming from multi-property owners. On the flipside, only 1% of the revenue is coming from the couchsurfing model. But that hasn’t stopped AirBnB from pressing that peer-to-perr story forward.

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I’m hoping to stay in this unit in a few weeks. It is a spare entrance to the main home where the owner lives, so I’m less concerned about the rental implications it has.

I like the idea of AirBnB and I’ve had a few successful bookings with it over the past several months. I’ve also had some incredible frustrating experiences with it and I have seen first hand the impact it can have on rent prices in major cities where a landlord makes more money running an illegal hotel than renting the units out to long-term residents.

And so it becomes a question of what to do. I’m hoping to use AirBnB for a booking in a few weeks in Canada where there are not many hotels and where the regular B&Bs I’ve contacted seem to be full. And I want a similar booking (though I may use HomeAway or VRBO) in St. Maartin later this year. But I’m also skeptical of using it in more urban areas, the places where the savings are arguably the most significant, as I wonder about how it impacts the real world rental rates there. Should I even bother?

I honestly don’t really know.

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, LinkedIn and .

4 Comments

  1. Venice, Italy is probably an interesting city to study when comparing local resident rental rates vs tourist rental rates and how it impacts local residents. Sure, some locals occasionally rent out a room or their flat while they’re gone but there’s also the property management teams/booking services which hold a large portions of the listings. Tourism growth edging out what locals are willing to pay has wider ripples, too, where tourist services replace everyday local services.

    There’s some interesting discussion around that here
    http://www.fodors.com/community/europe/venice-an-interesting-story-on-trying-to-stem-more-tourist-development.cfm

  2. Used AirBnB to book an apartment in London in about two weeks. The cost was about half of what a nearby 3-star chain hotel was charging. All the reviews were very positive so I’m looking forward to a positive experience. Fingers crossed.

    1. Odds are it will be fine. And if it is someone renting a spare room then good for them. If it is a broker running an unlicensed hotel I’m a bit less optimistic about the whole thing.

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