Those of you who are in the real estate industry are likely well aware of Airbnb. The new sharing-economy service that allows for average, everyday citizens to rent out their homes to other, everyday citizens. It’s an incredibly popular service that is still gaining traction. But it is still not without its controversy.
Created in 2008, Airbnb was founded on a simple premise: anyone can become a landlord. And while that premise is as simple as can be on paper, in practice, it can become incredibly complicated. The young but rising company had to learn this the hard way; in fact, it is still learning this. Over the last year or so, Airbnb has been threatened by multiple states in regards to their business practices. Many states are skeptical of the service’s ability to ensure safe and healthy lodging to its customers. And that is only one problem facing the sharing-economy company.
Since Airbnb’s rise in popularity over the last few years, several reports have surfaced claiming that landlords have evicted tenants from their homes in order to make way for Airbnb customers. Airbnb is also deeply affecting the traditional hospitality industry. Several of the largest hotel chains in the world are fighting against Airbnb’s business model, since it is such a major disruptor to the industry.
However, one industry is also feeling the negative implications of Airbnb: real estate. Because the sharing-economy industry in general is still so new, many local governments and industry experts are struggling to keep up. A report from the Washington Post describes a conference last year where a panel of real estate experts discussed the implications of services such as Airbnb for over an hour. One of the co-moderators of the conference, Christopher McElroy, explained one of the biggest issues concerning short-term rental services very simply: it creates pressure on availability and affordability. There are even more problems stemming from short-term rentals and the shared-economy service, like zoning laws, property value and the second-home market. These are all questions that need to be answered, because services like Airbnb do not seem to be going away anytime soon.
What are your thoughts on Airbnb and the sharing-economy as a whole? Will it hurt the real estate industry or is it simply a small nuisance that will never truly amount to anything?