Not the city, but the locals who are not in tech.
The problem obviously exists beyond AirBnB, but AirBnB massively escalated the problem.
It really is so problematic that cities like Berlin, Amsterdam (and I believe Venice) and many more crack down on AirBnBs. Hard. You are allowed to rent out the apartment where you live, but for limited time and with high fines or even extradiction on renting out beyond the limits (e.g. 90 days per year). You are certainly no longer allowed to have AirBnBs for the sole purpose of renting out to AirBnb.
Edit: and in e.g. Berlin, AirBnB does not hand over the data of their users/renters (which Is good, I presume). So they have people scanning the renting-websites, visting homes and even posting outside to find evidence something is rented out beyond the allowed duration.
That's a ridiculous requirement. Owning real estate for the sole purpose of renting has been an income source for ever. Just because Airbnb exploded this practice in popularity doesn't give governments the right to say what purpose owners can use their property for. If Airbnb is causing issues, then address those specifically, not ban the practice of owning property exclusively used for renting.
Even laissez faire countries like America use things like 'zoning' and 'setbacks' to control what you're allowed to do on your own property.
Banning short-term rental properties feels like a quick bandaid to gain political points, not a solution to a market with a large demand.
Seems more that you want government to facilitate running a business where it's not in the interest of that government, nor in the interest of the locals. Airbnb's aren't beneficial, plus they aren't checked as properly as a hotel.
Usually it isn't banned, what they're after is that it is limited (days/year), plus the AirBnB income is properly taxed.
So bad, that you often cannot even have a neighborhood café, corner pub, or local shop in modern suburbs. So bad, that you need to take the car to do shopping. For someone from western Europe, this is mind blowing insane: you need to take the car to buy your milk!
But short-term rentals are basically identical with hotels which are commercial properties and have substantially different requirements - the people staying there will not frequent supermarkets, etc as much as they will restaurants, etc. They will not be sending their children to the local school, and so on.
Mixed use property can be (and should be!) encouraged, but it does have externalities that have to be handled and accounted for.
of course the government is gonna govern.
quoting you here
"governments told what purpose owners can use their property for, for ever"
That’s true.
The power of government to govern does not originate with AirBnB, but predates it considerably.
The particular use of the power may be responsive to situations created by AirBnB, though.
The original idea of AirBnB was to easily rent your couch or guest room for a few nights and I think regulations should be made to keep it this way.