An Open Letter to Airbnb The pitchforks are coming
survivingtomorrow.org
survivingtomorrow.org
The wealthy and powerful have figured this out. They are operating under the assumption of zero/negligible pitchfork risk. Externalities? Just ignore them. If regulation looks like it might interfere with your business, capture the regulatory environment. If that doesn't work, just ignore the laws until governments can get their act together to enforce them (if they even bother).
If the government can't get its act together, people's recourse is to use the sluggish mechanisms of democracy to achieve incremental change. Meanwhile, you're moving fast and breaking things! Breaking whole economic sectors while the city council debates proposed legislation for a 0.25% surcharge.
"But eventually people will get fed up!" Maybe. But what are they going to do about it? They're not literally going to burn your corporate headquarters down. They're not going to pelt you with rocks. The few impulsive types who do commit violence and destruction will be dealt with. The rest of us will just go on the internet and complain.
If the government is sluggish and defanged (as it is in much of the U.S.), and there's no other realistic threat to business as usual, why SHOULD any of these powerful jerks change their ways?
Giant democracies seem like an inefficiency waiting to happen. Too many people, too many interests, too much muck in the machine. We need more local government.
Personally, I think that is a hilariously awful prediction with effectively zero chance of coming true and I would love to take the other side of a bet about it.
A little skepticism of his other claims is warranted.
Big if!
You can do this buy purchasing shares of ABNB. I own some, and this article did not change my thesis.
Is there anything beyond the 'app' experience that makes Airbnb fundamentally different than VRBO, which was more or less in the same industry since the 90's?
All I know is that I can't stand hotels and resorts, and would really miss it if something like Airbnb wasn't available when travelling.
During this time Airbnb was STILL letting the host (with 40 properties!) continue to rent. We were monitoring the reviews and it was clear that they were scamming people continuously. The reviews were constantly reporting being moved at the last minute to other houses/apartments than what the people payed for. In our case we were lucky because we were driving and could just turn around and drive home. Airbnb is riddled with scams and the company is complicit.
Learn from our mistakes, skip Airbnb.
If they rented for 21 days and paid $5,000 total, that’s $250/night which will get you a decent hotel in Columbus but no dogs, no yard, living in a hotel versus a house…
So I’d say the price is about spot on for what I’d expect.
The fact that they f'd this up in the US is... not good.
Well everything rots in the end. Thank you google for that pixel that I paid for on a CC that went 1:1 to AirBnB credit, we had a lot of fun burning through that.
Other than that we've had exactly one bummer AirBnB, in Queretaro MX. Our place on the penultimate floor of a very US looking apartment complex apparently was located under some sort of factory on the top floor, and produced vibrations all night long that I kid you not caused eg various phones to walk along whatever surface they were placed on.
Owner of room apparently leaves the door key in a mailbox. Previous renter apparently took it with him when he left leaving no way of getting in. Owner obviously did not live nearby. I eventually waited for someone to exit the complex so I could get in. The door to the apartment had a computerized lock but that basically meant I could not leave the room at all. Room of course was also not cleaned from the previous customer since all the towels didn't appear to be thoroughly washed if at all. After waking up at 4AM to bug bites I basically frantically made sure none of them got into my luggage for the last 3 hours or so I was there.
What did airbnb do? They "refunded" my cleaning bill and ended it at that. For 2 weeks I had to go through their support on the website only to be stonewalled or ignored. I sent them pictures of my hand that had bug bites, I sent them the text messages the owner sent, even though it was on the Airbnb platform. No dice. Finally I ended up getting through to someone via their Twitter account and was eventually able to get a refund for the night.
Of course I left a negative review on their page warning others about the possibility of being stranded if the previous guest forgets the key and also their lack of cleaning, but it got immediately buried by their algorithms.
That was about 4-5 years ago, never used Airbnb again.
One simple fact Airbnb does not understand is: vacation rental biz is built on repeat customers coming back to the platform often. If folks like us get such a bad experience in staying first and then dealing constantly for weeks with AirBnb customer reps, that experience would make sure we would never rent again on Airbnb. This is the biggest problem with their business right now...their customer service is just terrible.
"Good customer service interferes with our exponential growth plans and makes our investors nervous, so we ain't gonna do it."
Oh right, google has no customer service. No one to call.
What does it mean that customer service is so terrible in the disruption/replacement companies? That it's hard? Or that customer service is soooo old economy?
I fear for when all companies with semi-functioning terrible customer service are replaced with even more "disruptive" dystopian service models.
Can it be? Is "Brazil" a documentary?
I stayed at a supposedly four star hotel in Memphis once that not only gave me the wrong room where the faucets and most everything else was broken, and didn't care to change it, they also got in an accident with my rental car when the valet was going to park it. They didn't want to deduct any charges and didn't much care about any of it, so I called Amex and they put a hold on all charges. Four or five weeks later they told me I didn't have to pay for any of my stay, and since there was a hold on the charges I obviously didn't have to pay that part of the credit card bill either so I was never out of pocket in the meantime either.
Most of the time traveling I've never really had any issues, but when I have it's been a god send not to have to deal with any of it myself.
There is enormous demand for both temporary and permanent housing in many places, and to some degree it is fungible. If it wasn't Airbnb, some other agency or company would be servicing the need.
The only solution to the underlying problem is to allow construction to meet the underlying demand.
And the author's premise that short-term housing is more ethical than long-term housing just makes me think he has an axe to grind.
Anyway now the people that actually live in these locations can no longer afford to rent, let alone buy (again, the point of the article). If you don't see the problems with that (starting with airy concepts of 'community' and ending with your anger that there are no longer any nurses or teachers in your town) then you are even more of a wilfully ignorant passive-aggressive libertarian dork than the hacker news average (a bar which is set extremely high).
While I do think that allowing more construction would be great, there's probably other things that could help alleviate the problem.
1. Limit the number of units that can be rented by a single landlord in an area 2. Limit the proportion of units in an area which can be rented (maybe creates a sort of taxi-shield problem which might be it's own weird thing, but that's a problem for multi-property landowners, not single family homeowners). 3. (as OP suggests) limit the number of nights/year which can be rented to some number which would be very reasonable for a resident-owner who's out of town sometimes but very unreasonable for owner-investors. 4. Maybe some kind of hybrid approach - you can rent out space in your primary residence all you want, but your nth residence is only rentable 1/f(n)% of the time (for some reasonable f(n))
All of the above are presumably best implemented by governments rather than a well-meaning airbnb (who, even if they existed could presumably be overpowered by a less-well-meaning competitor)
Those taxes get paid by the renters, but they also reduce the profitability of the rentals (at least if they are competing with options that don't have those taxes).
Another option may be abolition of all commercial use of or non-private ownership of residential property in toto. Renting is illegal. Using it for your business is illegal. Apartments are illegal. Speculative ownership of housing is illegal. Housing prices implode, but you don’t have AirBNB tycoons.
I’m not serious, but “stop being greedy AirBNB or, boy, you’ll be sorry” isn’t much of a serious argument.
Airbnb's response was okay, and implied this was a "common scam". After that, I bailed. Not staying on a platform that can't implement basic security (at the time) like 2FA.
Hearing about all of the other problems people are experiencing on Airbnb now makes me glad I stopped using Airbnb. I guess I got lucky with the customer support on my issue.
These companies that disrupt industries seem to all have a common arc to them. At some point, the benefit they provided stops, and they start causing more harm than good.
It just... doesn't make sense. On some level I think people want to think this way because it avoids blaming ourselves for failing to elect representatives and pass legislature that would've prevented these problems. Or even do that now. That's hard, though! It'd be so much easier if companies just "Did the right thing™".
Of course, they won't, they never have, and we should never expect they will. Organizations will almost always seek to do whatever is best for them, everyone else be damned, and we as a society need to plan for that. Turns out it's just not so easy.
It's too easy to point the finger at some specific entity rather than our structural issues. Pet peeve of mine.
Imagine if there were no articles written about Amazon, or Airbnb, and instead there were only article written about exploitation of workers or skirting the hotel laws as bad things that are happening (either in theory or out there in the wild). In that case, the public won't actualize it or internalize it enough to take action with who they vote for, and in turn elected officials won't bother taking action because their constituents don't know/don't care and so it's not important for them either.
But that just doesn't generate the clicks like "Amazon is evil" does.
You can flog governments by highlighting how companies like Amazon exploit people and the rules. You could write the exact same article and then instead of demanding AirBnB change, demand the government to change.
The solution is to construct a system where selfishness is harnessed for the betterment of society. People will work 10x harder for themselves than for others. Fortunately, we know what such a system is - free markets. Free markets in America produced the highest living standard in the world.
A bit dubious. If I were asked which place in the world I thought had the highest standard of living, it sure as fuck wouldn't be the states.
As someone who wasted a lot of 2018 and 2019 trying to get uncorrupted Democrats into office the problem is that huge swaths of the population in the US have just given up. They are so overworked, barely able to stay above water and cannot get any simple break. Of the ~10-15% of a district that comes out to vote for a primary they always heavily lean towards a known brand unless that incumbent has royally screwed up or did not truly fight for his seat to begin with.
Examples:
AOC (NY-14): Joe Crowley was given the seat through a loophole and because he was THE top dog in terms of his connections to Wall Street, the Democrats would give him whatever he wanted. It took someone like AOC who better represents the community working extremely hard to unseat him. And he lost because he never really understood how to win an election so she ran circles around him.
Cenk Uygur (CA-25): This very red district was won by Katie Hill in an amazing victory only after an enormous amount of voter outreach. She had to build a massive amount of voter recognition very quickly and it was still a tough race. When the election came around to vote her replacement after her resignation, voters went with a party loyalist who had been on the ballot more than 5 times already and had been seen around the district vs someone who had pledged no lobbyist money and aligned with Bernie Sanders. I watched firsthand how we managed to convert Trump and old school Republicans (the Ronald Reagan library is in this district) to be for the policies of Bernie Sanders. In the end, we just couldn't overcome that threshold to convince enough of that 10-15% of the voters to vote for us over the person who was familiar.
There are other stories but they all follow the same format. Crushing losses because these all these districts with 700k people just have such poor turnout for elections. Even elections like 2020 had ~66% turnout and typically it is is mid 50s. So many people just have checked out.
I agree with the author that there will be a reckoning not only for AirBNB but for the rest of the elite. A vast swath of the country is sinking further and further and something will eventually have to give.
But in the meantime, it is not entirely the populations fault. When you whole life has been being lied to by previous politicians eventually you will think the system is too far gone.
"Airbnb consistently undermines the City's efforts to preserve affordable housing, and regularly attempts to thwart regulations put in place to protect New York City residents... Despite claims to self-regulate and crack down on illegal listings, Airbnb continues to be complacent in the illegal practices of over half of their hosts."
I agree that it's probably pointless to appeal to a company that has no interest in following laws that impact the bottom line, but at some point externalizing the costs of regulation shouldn't be a business model.
If you're a business and you embrace something like uber eats or Airbnb, you're giving away the most valuable thing your business has - your direct relationship with your customers. Once they start going through and intermediary platform, they're no longer your customers, they're the platform's customers. You now have exactly one customer, the platform. And that's a really nasty place to be since your one customer now has control over 100% of your revenue.
I understand that it's tough to not be part of these platforms, and you'll definitely make less money in the short-term. But if you embrace them, sooner or later you're going to get screwed big time.
This is all caused by investments no longer offering the same yield. Yields and interest rates have dropped artificially, due to the Fed and government pouring liquidity into the market.
The abnormally cheap credit then flows through the system into whatever is left to buy, including housing, stocks, and CryptoPunks.
However, we might just get a tapering soon, because even the powers that be are deeming the situation risky, and hopefully prices return to a reasonable level.
https://www.cnbc.com/2021/08/27/housing-price-bubble-will-wi...
(well I now remember that Twitter is thinking about doing the same [1] so I guess that's just how Internet works in 2021)
Airbnbs response: tough luck. You only have 1 day to report if the host lies. After that, it doesn't matter how much they lied, it's your responsibility.
And it's not worth the credit card challenge if you are a frequent traveler because you will get banned from the platform and they have an almost total monopoly on a certain type of property.
Thanks for stranding me in a foreign country where I had no support network airbnb.
There is another issue in US, not related to the Airbnb, which is zoning law that makes houses artificially low inventory. With or without Airbnb, investors and funds are going to buy those houses becuase long term the price is going up as long as zoning law is in effect.
It doesn't. There's always more tourists coming into a city than AirBnBs can handle, especially in big cities. I currently live in Dublin, and AirBnB is a huge issue here. And these people know they can keep charging their prices and raising them because tourists will keep coming. In doing so, they've taken over a thousand units (and probably several thousands, honestly; 1600 is the number that went back on the market when the pandemic hit) off the long term rent market, making the housing crisis here even worse.
Do they really think airbnb will self-regulate and solve the affordable housing problem? Just because the author asked them to?
These problems need to be tackled by local and state governments. We should never trust a corporation to act in the people's best interest. The goal is to make money.
I don't know, and it's clear the author doesn't, as he didn't tell us.
Stuff like this really turns me off from an article. The author is not sincere in asking. He wants to put an idea into your head subversively, while keeping the option of saying "I didn't claim it - I was just asking!"
The other interesting part is that he's drawing a line of convenience: He's OK with people owning houses and renting them out (as he lives in one and wants to keep it that way) - just not OK with short term rentals. As someone who follows the RE market, I know that in higher COL areas, people who buy houses and rent them out are considered to be part of the problem and are lumped in with the AirBnB folks.
At the end of the day, he just wants what is convenient for him, but is trying to couch it as a moral problem.
> How many million houses has Airbnb taken off the market so far
Is AirBnB expected to know which houses are owner occupied, and which are only occasionally listed? I mean, they can likely infer it from how often a unit is listed as available, but I doubt they make people disclose that. Same point for the other one.
There are independent ways to study this. You don't need to rely on AirBnB to find it out. A simple Google search reveals this: https://fivethirtyeight.com/features/airbnb-probably-isnt-dr...
Granted, it's a bit old, but could he have not done this before posting it?
I'm not saying that ours is a good system, nor am I saying that it is well-executed. But an honest discussion of renting should include the fact that some of the "felt squeeze" of rent ultimately reaches back to pension funds that want to disburse regular payments to pensioners. (Regular payments come from having a certain percentage return on the money in the fund. The percentage return comes, in part, from investing in real estate redevelopment deals, which increase in value when the value/profit from a property is increased. Value/profit are increased via more units and higher rents.)
This being said, the medium author does make some good points after accounting for the performative open letter tone, like about AirBnb's suing-cities-as-a-service as a business model, and the effect of Airbnb on local markets.
The dynamics here are actually backwards from most markets. Normally by diffusing ownership over a large population you decrease the power of the owner lobby, since no individual cares enough to vote on it; whereas the concentrated owners have the resources and motivation to be a powerful special interest group.
However, for housing, even with individual ownership the house would still be most people's largest asset. Further, in the concentrated ownership situation the class of renters is still motivated to vote on the issue because housing is such a major portion of their lives.
source: California resident