The Airbnb Dilemma: Navigating the Ethics of the Housing Crisis
Airbnb: the inbetweener accommodation
Airbnb was launched in 2008 by founders Joe Gebbia and Brian Chesky who identified a significant gap in the accommodation market. Airbnb was conceived as a platform where individuals could rent out spare rooms, studios, or entire homes to others in exchange for extra income. Since its inception, Airbnb has amassed over 4 million hosts in more than 220 countries and regions. The company’s substantial success can be attributed to its ability to satisfy the evolving needs of the market.
Travellers sought the flexibility to choose accommodations that suited their personal preferences. Budget-friendly travellers were content with modestly sized rooms so long as they had a comfortable bed and a working bathroom. Families were drawn to the idea of staying in a home with a functional kitchen, which hotels often lack. Some travellers sought after unique experiences, like renting out a farm stay. Airbnb seemed to offer it all. Moreover, the platform fostered a sense of community connection. Instead of feeling like customers in a transactional relationship with a corporate hotel chain, Airbnb guests could often engage with a personable local host who could offer personal recommendations and hands-on support for any issues they had.
For hosts, Airbnb presented an opportunity to earn additional income in a unique way. In contrast to less profitable long-term tenants, hosts had the flexibility to offer short stays with quick turnovers. They could charge higher rates during peak holiday seasons, and still manage to secure bookings during off-peak periods. Managing and advertising their home, as well as communicating with guests could be conveniently done through the Airbnb app. Support from Airbnb was also easily accessible in case of guest complaints or issues.
Airbnb enjoyed a decade of impressive success. However, the company has encountered challenges in recent years, suggesting that we might be witnessing the beginning of Airbnb’s decline.
To Airbnb or not to Airbnb?
Housing analysts have noted a shift among many landlords from offering long-term rentals to more profitable short-term leases. In Australia, which leans toward individualism, it is understandable that hosts are pursuing self-interest by using Airbnb to expand their wealth and financial security. However, this choice has not been without its critics.
Over time, communities have grown critical of Airbnb, claiming that the company has driven up rental prices and reduced the availability of housing for long-term renters, leading to the "hollowing out" of neighbourhoods. It appears that the market’s pursuit of self-interest has come at the expense of the broader community, with Airbnb hosts favouring tourists with deep pockets over the housing needs of their neighbours. The dire situation has prompted many to question the ethics involved in renting properties to holidaymakers during a housing crisis. We must consider: is it justifiable to deny someone a necessity, in order to afford another person a luxury?
Who’s really to blame?
In contemplating this ethical dilemma, a segment of former Airbnb hosts have elected to return their properties to the long-term rental market. Nevertheless, analysts argue that individual decisions alone won’t lead to any significant change. “Individuals choosing not to Airbnb because of a housing shortage is all great, but the big decision that needs to be made is government disincentivising landlords from those practices”, states Professor Keith Jacobs from the University of Tasmania. Ultimately, Professor Jacobs claims that the government bears the responsibility for the commodification of housing, and should be held accountable for the consequences of this issue.
Indeed, an increasing amount of jurisdictions are recognising their role in the housing crisis, and have introduced regulations to mitigate the negative impacts of Airbnb. Legislation restricting Airbnb and similar platforms has been enacted in cities such as Barcelona, Los Angeles, and New York, among others. For the first time, the regulations have reached our own backyard.
Just last month, the NSW government approved the Byron Shire Council to limit the duration of short-stay rentals to a maximum of 60 days. Mayors of other popular tourist destinations, such as Kiama and the Blue Mountains, have publicly expressed support for these short-term rental limits. Meanwhile, in Victoria, the government has imposed a 7.5% tax on short-stay accommodation to tackle the problem further. Former Victorian Premier Dan Andrews has stated that this tax was a modest measure expected to generate approximately $70 million in funds, supposedly devoted to social and affordable housing. Here in NSW, Premier Chris Minns has refrained from immediately endorsing a similar tax, but has promised to review the leasing rules, stating that “all options are on the table when it comes to confronting the housing crisis.”
While some form of regulation on Airbnb here in NSW seems inevitable, it’s likely to face significant backlash. Despite the public’s strong desire to address housing affordability, many homeowners firmly believe that regulation would deprive them of their right to benefit from their property investments. For a large portion of hosts, the additional income from Airbnb assists them in battling their own mortgage repayments and cost-of-living stresses.
Therefore, we must recognise that Airbnb is not solely the problem; it is also a symptom of a more complex issue. As we continue to tackle the current housing context, a mere tax or cap on Airbnb accommodation will fall short of effectively addressing the broader crisis. Rethinking government regulations will be the key to unlocking the door to housing solutions.
Airbnb: the inbetweener accommodation
Airbnb was launched in 2008 by founders Joe Gebbia and Brian Chesky who identified a significant gap in the accommodation market. Airbnb was conceived as a platform where individuals could rent out spare rooms, studios, or entire homes to others in exchange for extra income. Since its inception, Airbnb has amassed over 4 million hosts in more than 220 countries and regions. The company’s substantial success can be attributed to its ability to satisfy the evolving needs of the market.
Travellers sought the flexibility to choose accommodations that suited their personal preferences. Budget-friendly travellers were content with modestly sized rooms so long as they had a comfortable bed and a working bathroom. Families were drawn to the idea of staying in a home with a functional kitchen, which hotels often lack. Some travellers sought after unique experiences, like renting out a farm stay. Airbnb seemed to offer it all. Moreover, the platform fostered a sense of community connection. Instead of feeling like customers in a transactional relationship with a corporate hotel chain, Airbnb guests could often engage with a personable local host who could offer personal recommendations and hands-on support for any issues they had.
For hosts, Airbnb presented an opportunity to earn additional income in a unique way. In contrast to less profitable long-term tenants, hosts had the flexibility to offer short stays with quick turnovers. They could charge higher rates during peak holiday seasons, and still manage to secure bookings during off-peak periods. Managing and advertising their home, as well as communicating with guests could be conveniently done through the Airbnb app. Support from Airbnb was also easily accessible in case of guest complaints or issues.
Airbnb enjoyed a decade of impressive success. However, the company has encountered challenges in recent years, suggesting that we might be witnessing the beginning of Airbnb’s decline.
To Airbnb or not to Airbnb?
Housing analysts have noted a shift among many landlords from offering long-term rentals to more profitable short-term leases. In Australia, which leans toward individualism, it is understandable that hosts are pursuing self-interest by using Airbnb to expand their wealth and financial security. However, this choice has not been without its critics.
Over time, communities have grown critical of Airbnb, claiming that the company has driven up rental prices and reduced the availability of housing for long-term renters, leading to the "hollowing out" of neighbourhoods. It appears that the market’s pursuit of self-interest has come at the expense of the broader community, with Airbnb hosts favouring tourists with deep pockets over the housing needs of their neighbours. The dire situation has prompted many to question the ethics involved in renting properties to holidaymakers during a housing crisis. We must consider: is it justifiable to deny someone a necessity, in order to afford another person a luxury?
Who’s really to blame?
In contemplating this ethical dilemma, a segment of former Airbnb hosts have elected to return their properties to the long-term rental market. Nevertheless, analysts argue that individual decisions alone won’t lead to any significant change. “Individuals choosing not to Airbnb because of a housing shortage is all great, but the big decision that needs to be made is government disincentivising landlords from those practices”, states Professor Keith Jacobs from the University of Tasmania. Ultimately, Professor Jacobs claims that the government bears the responsibility for the commodification of housing, and should be held accountable for the consequences of this issue.
Indeed, an increasing amount of jurisdictions are recognising their role in the housing crisis, and have introduced regulations to mitigate the negative impacts of Airbnb. Legislation restricting Airbnb and similar platforms has been enacted in cities such as Barcelona, Los Angeles, and New York, among others. For the first time, the regulations have reached our own backyard.
Just last month, the NSW government approved the Byron Shire Council to limit the duration of short-stay rentals to a maximum of 60 days. Mayors of other popular tourist destinations, such as Kiama and the Blue Mountains, have publicly expressed support for these short-term rental limits. Meanwhile, in Victoria, the government has imposed a 7.5% tax on short-stay accommodation to tackle the problem further. Former Victorian Premier Dan Andrews has stated that this tax was a modest measure expected to generate approximately $70 million in funds, supposedly devoted to social and affordable housing. Here in NSW, Premier Chris Minns has refrained from immediately endorsing a similar tax, but has promised to review the leasing rules, stating that “all options are on the table when it comes to confronting the housing crisis.”
While some form of regulation on Airbnb here in NSW seems inevitable, it’s likely to face significant backlash. Despite the public’s strong desire to address housing affordability, many homeowners firmly believe that regulation would deprive them of their right to benefit from their property investments. For a large portion of hosts, the additional income from Airbnb assists them in battling their own mortgage repayments and cost-of-living stresses.
Therefore, we must recognise that Airbnb is not solely the problem; it is also a symptom of a more complex issue. As we continue to tackle the current housing context, a mere tax or cap on Airbnb accommodation will fall short of effectively addressing the broader crisis. Rethinking government regulations will be the key to unlocking the door to housing solutions.
