Window into Airbnb’s hidden impact on SF
sfchronicle.com
sfchronicle.com
As property listing sites go, Airbnb did not produce any true innovation. And although they clearly must have done some things really well to generate so many people using their service(a.k.a. probably taking them out of craigslist), the really true 'innovation' they did was getting away from abiding regulation.
Now that they are big, they are going to cooperate as much as possible to build regulatory walls so that another Airbnb wouldnt be able to show up and contest those rates.
I have the same feeling from Uber/Lyft. The traditional taxi service is terrible for drivers, and they present true benefits to them: but only because they found a way to bypass the law by paying with the apps instead of giving money to the driver. (If I made a site on my own, and picked up people from the street and the gave me money in hand, i would be breaking the law).
Now that they are big enough, they can also influence the rules enough to make it harder for future competition.
These strategies can only work when the companies get big enough to influence the law making, or when they have such a strong market dominance(or monopoly) that they can now afford to abide by the rules (or to make them).
So, in terms of Airbnb , the only innovative thing they did was finding a law loophole. Woohoo.
Or lived basically anywhere which has uni students.
Many places (like NY for example) actually have laws that expressly protect tenants rights to sublet.
Landlord tenant laws mostly are there to protect the tenant from unfair slumlords.
I've never had a problem with uni students in the city I used to live in and a couple lived in my building.
I suppose you wouldn't mind living next to this place then - http://www.latimes.com/local/lanow/la-me-ln-airbnb-party-hou...
I like my neighbors (except one... that's a different story...) They are friendly. We help each other clean off our cars in the winter. We check on each other's mail, pets, plants, and houses while we are on vacation. We help each other carry heavy items into the house. We are known to each other. I personally wouldn't feel safe with neighbors who revolve every day who have no ties to the community that we built.
Not to mention I wouldn't want to pay double rent because of all the houses that are taken off the market.
It's crazy stupid that Marriot or Hyatt have not tried to acquire Air BnB.
The traditional taxi service, if bad for drivers, is simply because there are enough drivers that will work and be treated like that to make it terrible for the group as a whole.
This happens in any employment situation where supply exceeds demand.
Because there is a low barrier to entry to be a driver as well as lack of other opportunities for drivers the people in charge get leverage.
Likewise "superstar" developers are treated like royalty and well paid in this industry. If all the sudden there were 4 times the superstar developers vying for jobs (assuming demand stays fixed and a superstar is a superstar) all that would go out the window and wages and benefits would almost certainly drop.
I'm a pretty good photographer but decided many years ago that since photography had a low barrier to entry, and only a few made it to the top, wages were decreased by competition to make it a non attractive career.
That is until human is immortal, energy is unlimited (to a first approximation), and/ or the Singularity happened.
And also, in the particular taxi-driving business, the problem is not supply/demand of drivers, its of city permits to be a taxi driver. Drivers working for Uber/Lyft do not take the same abuse as taxi drivers.
The taxi business is a racket, made by people that took that business, got an advantage in that time, and could make laws to their own benefit. Uber found a loophole in those laws, and got to be a winning player in that market. And now, they are going to be one of the actors in redefining the new set of laws regarding this,
The problem is not a mismatch between supply and demand. It is an artificial barrier between the supply and demand meeting up.
There are plenty of people who wouldn't be violating any rules or laws by being Airbnb hosts. Clearly the service could exist without anyone bypassing laws. You might instead argue that the business model requires laws to be flouted in order to turn a profit, but I don't see how you'd prove it.
Why do you dislike that? Is it because you think any business which bypasses laws is inherently bad, or is it because you think these particular laws (zoning, hotel regulations, etc.) are themselves valid and should not be broken?
It innovated so much that it enriched my own life quite substantially. I needed what I was only able to find via Airbnb. And those renting their own places needed the money.
All the benefits you and the landlord enjoyed were externalised onto others.
Don't forget this:
But on the other hand, recent technological advancements hold potential for huge improvements in almost every important industry(for ex. healthcare), but in many cases, are blocked by regulation.
Looking at the amount of value such innovations will create , it sometimes seem greatly unethical not to use that loophole.
Strongly disagree. As an Airbnb host (I rent out my master suite on Airbnb), there simply wasn't a site where I could do that before. Craigslist? Forget it--spam heaven, and no calendar or payment system. And VRBO has always been designed for "vacation homes", not "rent a single bedroom in a house you occupy" (which is why I use Airbnb.)
I live in Austin, and Austin has responded to Airbnb by making hosts pay hotel tax, and requiring us to register with the city. While an inconvenience, I'd rather do that than not be able to make extra income renting out the room. I hope San Francisco can do something similar (and I really hope Airbnb builds this into their site so I can stop filing paperwork and mailing paper checks every quarter!)
For example, I could start a service that allows people to make food in their house and sell it online. The reality is that in most municipalities you cannot simply cook food in your kitchen and sell it.
The difficult part in Airbnb, Uber and my imaginary sharing economy food service is managing to get big enough before authorities catch on. And getting big fast just happens to be something the VC model is very good at.
In my opinion it's more an innovation of hyper growth VC funding as a means to out run authorities enforcing regulations, laws and tax codes as opposed to the innovation of something built into the individual service of Airbnb, Uber etc.
http://venturebeat.com/2014/06/10/airbnbs-stealth-home-dinin...
It's quite a bit easier to die from "disruptive food" than "disruptive lodging" in my personal experience from roughing it once upon a time.
Lots of stuff sold at food co-ops and farmers' markets skirt these rules and no one bats an eye. Yet they're doing pretty much the same thing as Airbnb and Uber -- performing valuable services while entering questionable regulatory territory.
It's weird how baking pies in your own kitchen and selling them is considered a very wholesome activity, yet using your own car to drive people around is somehow objectionable.
The regulations in place don't do a huge amount to fix either of those problems, but having something in place makes people feel better.
I'm not sure you thought this through.
Some people bat an eye.
http://www.forbes.com/sites/erikkain/2011/08/03/the-inexplic...
Laws are written and interpreted within the context of old, established businesses. Innovation will inevitably produce a certain amount of tension with those old laws. One approach for to dealing with this is to ask permission / change the law first, but that will usually fail because the incumbent businesses generally don't like change (imagine trying to get Hollywood's permission to launch YouTube). The second approach is to move forward within the spirit of the law, deliver genuine value to consumers and society, and then work with legislatures and the courts to develop improved laws and understandings of the law.
Second, and more importantly, you seem to neglect the fact that some AirBnB hosts are not just violating laws, but their leases and HOA rules. These are legally-binding contracts between private individuals.
AirBnB's most ardent supporters like to focus on zoning and hospitality laws, suggesting that they're antiquated, anti-competitive, etc. Some of these arguments are quite reasonable in my opinion, but what about private contracts? I have yet to see convincing arguments around the issue of hosts who are violating their contracts with their landlords and/or homeowners associations.
Most apartment leases have strict terms around subletting and many HOAs have restrictions around property use that would be in conflict with AirBnB-style short term rentals. Even if AirBnB doesn't have a legal obligation to help enforce these, given the number of listings that are ostensibly governed by leases and/or HOA rules, it seems implausible that AirBnB isn't aware that a good number of its hosts are breaking private contracts, potentially exposing those hosts, their neighbors and even their "guests" to a variety of risks.
Does AirBnB not have a moral obligation to address this? I'd love to see more AirBnB supporters take on this issue. At least it would be more entertaining and perhaps even more enlightening than the recurrent arguments against zoning and hospitality laws.
Surely that responsibility is the host's.
Some people are not going to be covered by insurance during a sub-let. Those people might be the host or guest or apartment owner; but in the case of catastrophe someone is going to lose out.
So there is some value to customers of having listings vetted by AirBnB so that everyone knows that the sub-let is legal and insured.
> My place is available for the whole month of June, and is located at xxxx. Subletting isn't technically allowed at the building, so you would need to be careful around the staff.
It seems like your response is "AirBnB has no moral obligation to try to discourage its hosts from violating an agreement it knows likely exists", but I'm curious as to why you chose to throw this back to me as a question rather than stating a concrete opinion. Do you hold other companies to this same standard, and are you comfortable stating on record that what's good for the goose is always good for the gander? If so, why disguise your opinion as a question?
On the point of corporate morality, I'd note that companies in certain industries are frequently lambasted for acting amorally. Just look in finance. Big banks, mortgage lenders, hedge funds, high frequency traders. They face almost constant criticism for engaging in behavior or failing to prevent behavior, even when their actions do not violate the letter of the law.
Are there no AirBnB supporters who have criticized other companies for amoral behavior?
As a side note, look how often that criticism of the finance industry amounts to any real effect on those companies. If that's the model we're looking at, the prevailing wisdom says to just do it and ignore the critics.
Also I think most people just aren't that concerned about the sanctity of HOAs and residential lease agreements (compared to, say, the global economy), and those are easier to amend and negotiate on than laws.
Many financial institutions facilitate transactions. Goldman Sachs paid over half a billion dollars to settle charges related to the Abacus deal it facilitated in 2007.[1] Goldman was paid a $15 million fee for facilitating that deal, a meaningless fraction of the $46 billion in revenues it earned in 2007.
As I noted, the vast majority of apartment leases forbid subletting without the landlord's approval, and you would be hard pressed to find a single landlord who allows tenants to turn their apartments into hotel suites. As such, one could argue that as far as apartments go, this isn't a "might" proposition. There's a very reasonable argument to be made that AirBnB can safely assume that apartment listings on its site more often than not involve a tenant breaking the terms of his or her lease.
If you don't have a problem with AirBnB facilitating apartment rentals in the face of constructive knowledge that many of them are taking place in violation of the terms of the host's lease, that's fine. But then you shouldn't have a problem with financial institutions when they merely facilitate transactions that don't pass your smell test. What's good for the goose is good for the gander, right?
[1] http://sevenpillarsinstitute.org/case-studies/goldman-sachs-...
It wouldn't be rocket science to require hosts to prove that they have ownership or approval to let out their flats (i mean, you can look up property ownership info online for most US cities). Especially since, from the host's perspective it's not a 1 time transaction.
They're just skirting the law because it's convenient.
It's pretty obvious that turning an apartment into a hotel room is a legal problem in many if not most instances. Making the claim that "people just aren't that concerned about the sanctity of HOAs and residential leases" is just plain delusional. You'll get concerned when your lease gets terminated or the HOA takes up action against you.
The whole situation is a moral hazard -- the owner/lessee of the apartment/house bears almost all of the risks. AirBnB just needs to keep the PR machine churning. That's why they have figured out how to verify the identity of renters (to address the issue of some sort of psycho serial killer renting rooms), but still find it impossible to confirm that lessees of property can in fact rent those rooms.
Some HOAs are restrictive on sublets and some newer ones explicitly prohibit short-term rentals or require an owner live-in minimums. The question is why?
The spirit of such regulations is that long-term owners, who typically rule the HOA, don't want their complex/neighborhood to be used for short-term parties, which brings noise concerns, safety concerns, possibilities of vandalism, etc.
If that is going to happen, HOA has the means to nab the offending owner, usually start him off with a warning, and later move that up to penalties or whatever other means they have at their disposal. If that never happens, HOA will stay mum.
Why should AirBnb get in front of the issue that's self-solving?
So are good quality photos in order to get bookings. Yet Airbnb will make an effort to send a proper photographer around.
Thus there's the idea of "efficient breach" - where the right thing to do might be to break the terms and compensate the counterparties, leaving everyone better off:
http://en.wikipedia.org/wiki/Efficient_breach
There are many tiny breaches of leases and other contracts that leave society better off: looking the other way if a small pet or temporary houseguest arrives, or there's an occasional bit of "medicine smoking" on the premises, or some unapproved property improvements. It's tough to work up moral outrage if there's no evidence of actual harm, just technical violations. Compare malum prohibitum vs. malum in se:
While some cities will probably revise occupancy and hospitality regulations to accommodate things like Airbnb, the tension between renters and landlords w/r/t/ sublettors is quite old and quite well explored by the courts (check out your local tenants union for chapter-and-verse citations). The lease provisions that forbid Airbnb will stand up in court.
That is really a very simplistic view of the real world of real estate. For example, in 1983 when I bought a Houston house, I read every scrap of paper involved in the transaction. (Title company closers call us "readers.") The faded Nth generation copy of the deed restrictions ("an agreement between two private individuals") had horrific language about not allowing those of other than the white race to live in the property (unless in servants quarters). By that time, that language had been neutralized by the Supreme Court, but there was a good period of time where it had legal force but had to be ignored by those of good conscience. George W. Bush got the one news cycle treatment about that as the same language was in the deed restrictions he signed, as well as in many subdivisions from that era. That language carries on in the record forever.
The distinction between the two is very relevant vis-a-vis your response to 'tptacek. The terms of a lease contract are freely bargained-for between buyer and seller in the present day. Because contracts cannot bind non-parties, they will only contain provisions that at least one party considers meaningful. However, a covenant is not freely bargained-for between buyer and seller in the present day. Both the buyer and seller may be bound by provisions that both believe to be antiquated (like covenants not to sell to particular minority groups).
If you think a contractual term is antiquated, you're free to bargain with the seller to have it eliminated. With a covenant provision, however, both you and the seller might be stuck with what someone wrote-in decades ago.
So my point isn't that the black letter language of any contract must in all cases stand up in court. My point is that the restrictions in leases that block Airbnb will stand up, because despite the relative novelty of Airbnb, the lease restrictions they butt up against aren't obscure. They are central to the tensions between renters and landlords and thus well-tested.
Also: if someone puts a contract in front of you that requires you to discriminate against African Americans: no, I don't think you can ethically sign it.
Again, you make a simplistic statement that ignores the real world. When social systems are realigning, there is a period when you ignore the plain terms of the contract because you know people aren't enforcing it anymore. Whether that is happening with AirBnB or not is not my point. My point is that it is really easy to make a blanket statement about being ethical in contract law. The chance of that statement actually being the "ethical" choice in all cases is, effectively, zero. The real world is much too complicated to reduce it to the logical exactitude you are claiming.
Sorry, but the Internet has not in fact rewritten every rule that is somehow inconvenient to people on the Internet.
Landlord has been using the same faded form contract for a decade; doesn't even know for sure which provisions are in it, or still legal under recent legislation or court decisions. (But, a standard 'severability' clause protects them when they've got illegal and unenforceable terms inside their template.)
Renter skims contract, but doesn't consider its terms negotiable, practically speaking. They often ignore the precise terms regarding notices, houseguests for more than X days, small pets, drugs on the premises, new roommates, sublettors, etc. In many cases the local law, or tenants' legal support groups, will defend them for violations of such terms - because the signed lease was illegal or unreasonable.
During the course of the lease, both the landlord and the renter may deviate from the exact terms from time to time, by tacit agreement, or occasionally verbal agreement (even if the contract stipulates "no verbal amendments").
Many renter violations are essentially in the realm of "don't ask, don't tell". The landlord doesn't really care and also doesn't want to know, because knowing would force conscious acknowledgement, perhaps encouraging further violations or incurring liability. Only if there's actual property damage or risk of harm/liability (or other adversarialism has begun from other factors) does the landlord become interested in monitoring and enforcing every clause.
Into this mix comes AirBnB. Many landlords won't notice the activity. Or they'll suspect it but don't want to pry. Or they'll know, but don't want to be known to "know".
Yet they may notice the rental rates the market will bear go up, benefiting them for looking-the-other-way. They may notice the renter's treatment of the property improving – as they now share an extra interest in its appeal. Compared to an empty room/apartment, the presence of good guests can make the property and neighborhood a safer and more pleasant place. So landlords can benefit implicitly even without an explicit renegotiation of terms.
In fact, they may prefer this sort of indirect benefit – because they retain the optionality of enforcing the terms, if things go poorly, without the risk of formally approving the activity.
Real economic and social relationships are way more complicated than, "the letter of the rules is X so everyone is duty-bound to do no more nor less than X".
[1] http://en.wikipedia.org/wiki/Digital_Millennium_Copyright_Ac... [2] http://en.wikipedia.org/wiki/YouTube
That doesn't make either of those services any less fraught. They can be incredibly valuable to me and a net negative for the communities they operate in. Not everything that makes me happy is good for society.
That is at least as true of government as it is of companies that bend or break regulations.
Hollywood started in the West Coast so they could be far enough from Edison and his patents
A lot less MP3 players would be sold if only legal songs were allowed to be loaded
But more importantly, a business goes deeper than a nice website. AirBnB built a business using a website, as opposed to several cases where a website is built and the business comes after (not saying it's wrong)
If you're curious, as I was, this is a good read: http://www.history.com/news/the-renegade-roots-of-hollywood-...
I don't have some strong feeling about what AirBnB has done. I am passingly interested because I previously wanted to be an urban planner, before life got in the way. I find it intriguing that the Internet is reshaping how urban space gets used. We clearly need to create new mental models here. Our old ones are basically dinosaurs that ignore this new reality.
I don't believe Uber's only innovation is circumventing laws, because Uber can't be run using a simple spreadsheet. Airbnb can, I know that because it used to be.
It's almost as if regulations stop people from doing what they want to do and usually only serve a narrow few.
Yet year after year, politicians campaign vigorously for re-election by talking about how many new regulations they have written. And anyone who stands up and suggests that maybe a bit of deregulation might be a good idea is branded as someone who is inevitably 'a danger to children/way of life/jobs/etc'
So we have a situation where people gladly partake of services which innovate around regulations (usually because it relieves the consumer of the cost of those regulations) yet feel the need to keep returning politicians who promise to create more regulations.
The only explanation I have is that most voters think the cost-burden of regulations will always fall on another voter, and that the benefits will flow to them.
On the other, laws grow by accretion, they exist within a historical context, and they are virtually impossible to get rid of once they have outgrown that historical context. Pretty much the only way to get a law off the books is to intentionally break it and then build enough popular support during the ensuing test case that you can either get a court to strike it down or a lawmaker to introduce a bill to repeal it. So people who break these laws are sometimes (not always) performing an essential service by forcing society to re-examine the rules it governs itself by and determining whether they still serve the public interest. And you don't know whether they're heroes (think Rosa Parks, the Boston Tea Party, or Sony Betamax) or demons (think Napster or the Unabomber) until public opinion comes down one way or the other.
It's also interesting how people's reaction to this seems to illustrate Lawrence Kohlberg's Stages of Moral Reasoning quite sharply:
Stage 1 (avoiding punishment): "AirBnB is fine because it's very unlikely that people will get caught or prosecuted" or "I won't use AirBnB because I'm afraid of getting sued or fined."
Stage 2 (self-interest): "AirBnB is a good thing because it lets me rent out a resource I already have and make extra cash."
Stage 3 (social approval): "AirBnB is fine because all my friends use it."
Stage 4 (law & order): "AirBnB is a plague upon this earth because their business model involves nothing more than systematically breaking laws and profiting from it."
Stage 5 (contracts): "People have a right to freely enter into contracts to mutually benefit themselves. AirBnB facilitates these contracts, and therefore is beneficial to society. It is the individual's responsibility to respect contracts they have already entered into with other parties."
Stage 6 (justice & universal moral principles): "If I were a host, I would appreciate being able to make extra cash by renting out my place. If I were a guest, I would appreciate the extra housing options. However, if I were a neighbor of a host, I would not appreciate the extra foot traffic and possibilities for damage or altercations. In many cases in today's economy, hosts are strapped for cash, and AirBnB may be their sole source of income. A host's right to make a living and not starve outweighs a neighbor's right to peace and quiet, and so the right choice is to legalize AirBnB but with regulations that can protect the rights of neighbors to the greatest extent possible."
I really don't object to airbnb' s existence. But I do think people in some neighborhoods should be able to trade their right to run a hotel out of their house in exchange for a legally enforced expectation that their neighbors won't either. This is critical for certain types of neighborhoods and is encoded in zoning laws.
I really like AirBnB when I'm traveling or when I want a nice getaway, but it's been incredible to see how how many units around me here in SF are full-time AirBnB rentals. Walking down my block alone, I'd estimate that 30% of the units here are full-time on AirBnB. Each afternoon, I begin to see the tourists and travelers roll in with suitcases, and I've noticed an increasing number of coded lock-boxes outside of many of the houses near me
Whether or not you support rent control is an entirely different issue, but I feel like AirBnB, as it presently operates, is incompatible with the system. In the days of yore, friends of mine would have rooms open up in their apartments and would rent them out to fellow tenants (or subtenants). Now, many folks I know are converting their open rooms (against SF law) to AirBnBs, as the tenants can make a killing off of them.
There's always been bad actors in the SF rental market -- many people would sublease rooms directly to tenants for far above the rate they were paying to the landlord. I think AirBnB just makes it a bit more appealing.
The easiest thing to do would be to enforce stricter rules to push the commercial entities out of the AirBnb system... but those are also probably the people who make AirBnb the most money.
You can still defend the practice by saying you don't agree with the law. But AirBnB can't claim they expect their hosts to all abide by local laws when in this case it's clear that a majority of their hosts are not.
That seems crazy.
I like AirBnB for that.
However, I have seen in SF places that are closer to hostel's and are far from safe or sanitary. Short Term Furnished Rental Properties feel like they should be legal, but 12 people squeezed in to a two bedroom apartment shouldn't be.
There may be need for some disruption, but that should be balanced with public health and safety.
As someone who's never lived in SF (and in fact my somewhat depressed area's just beginning to recover from a ton of vacancies left by the mortgage crisis), it's amazing to me that the local government seems to be contemplating restricting supply and demand, and stifling economic activity like this.
And if you can't see why this is a problem, maybe you should go take a look at the Wikipedia list of hotel fires in the US[1], and pay particular attention to just how many of those fires were caused by either failing to follow the fire codes or could have been prevented had decent fire code regulations been in place at the time.
[1]:http://en.wikipedia.org/wiki/History_of_hotel_fires_in_the_U...
http://www.sftu.org/David%20Chiu%20-%20Hotelization%20Ordina...
also -
http://foundsf.org/index.php?title=1980-1991:_RENT_CONTROL_W...
Ride sharing services disrupted the old-school mentality that only certain, privileged people should be allowed to provide driving services and the rest of us ought to be content with being passive consumers.
Open-source software disrupted the old-school mentality that only certain, privileged people should be allowed publish software and the rest of us ought to be content with being passive consumers.
3D printers disrupted the old-school mentality that only certain, privileged people should be allowed to produce physical goods and the rest of us ought to be content with being passive consumers.
Peer-to-peer lending disrupted the old-school mentality that only certain, privileged people should be allowed provide loans and the rest of us ought to be content with being passive consumers.
The Internet disrupted the old-school mentality that only certain, privileged people should be allowed to publish all kinds of media and the rest of us ought to be content with being passive consumers.
What airbnb "disrupted" is the idea that corporations should pay the taxes they are liable for, obey zoning laws, and respect their neighbors. There is relatively limited innovation once you get past tax dodging: vrbo, homeaway, et al, existed long before airbnb.
And in what sense is consuming ride-sharing any different than paying a taxi? Unless you help drive when you're in the backseat of an uber vehicle, you're just as passive as you would be in the back seat of a taxi.
Finally, plenty of people published stuff before the internet -- zines for starters, small newspapers, etc.
It isn't.
When I think of "ride sharing" I think of friends or coworkers actually sharing rides.
I used to do it back in high school. I worked with 3 friends and we all lived within a mile of each other. We would take turns driving the gang to and from work. That is ride sharing. It worked out great too!
Or we had ride sharing boards back in college. Going back home for winter break and don't have a car? Find a fellow student who is going that way to drive you. At least drive you within 30 minutes and have a friend pick you up. Throw $20 at them for gas but you aren't paying them really and they aren't making a salary off of you. Plus they didn't just pick you up and bring you where you want to go, you just rode with them to somewhere they are going anyway.
Once there is a business model involved it, commercials on TV, and are actually making money is just a business and a service not ride sharing. There's no sharing.
Haha, what? In what world are people providing lodging services the 1%? I can picture it now - Wall Street bankers getting bored, so they buy up inner city hotels to feel alive in the cut and thrust, high margin business of providing lodging to tourists. Sounds like a dream.
Both, however, are running up against existing legislation, put in place for a variety of good and bad reasons, depending on the locality.
There are two sides to AirBnB. On the one hand, you have people who have a spare room and want to make a bit of money out of it. AirBnB is great for them: that's its raison d'être. The site disrupts the horrible process in the past of going through Craigslist or something similar, having no guarantees about who might be turning up on your doorstep, handling payment, etc. Who could object to AirBnB being used for this? Not that many people.
On the other hand, you have people who buy an entire house or block of apartments with the sole purpose being to rent the entire place out via AirBnB. This is a terrible idea for a number of reasons.
1. We, as society, have decided for better of for worse that we won't let people set up certain types of businesses in their homes without getting permits first. Bars, hotels, shops...society has decided that we want the ability to zone and keep some areas clear of commercial properties.
2. More importantly, to me at least, is that these buildings are frequently not up to fire code. Hotels need to comply with far stricter standards than residential homes, typically including mandatory sprinklers, clear signage, multiple egresses, etc.
I'm more than happy to hear libertarian arguments around how zoning laws and the like serve no purpose. I can't think of any sane argument against fire and safety regulations for hotels: and that is what these properties on AirBnB are, hotels. Before modern fire codes, hotel fires were often devastating and horrific.
These types of properties on AirBnB - and there are a fair few of them, both in SF and NY - are both a) unquestionably illegal, and b) in many cases unsafe. Say what you will about UberX, but at least you know that your driver is licensed and the car is being maintained and serviced (both being requirements for legally driving and joining Uber as a driver). You can't say the same about 'pseudo-hotels' on AirBnB.
Taking it too far.
Anyone could own a BNB or a Taxi or a Manufacturing business, or even a publishing business. There was certainly no 'privelege' in any of those fields.
Really what we are seeing is the destruction of the middle-man - the hotel booking agent, the taxi dispatcher, the publishing distributor. That allows people to get started at much lower cost and allows them to compete on quality from the start.
A medallion (to be able to legally drive a cab in NYC) alone costs more $1.3 million[1], let alone any other costs. No privilege?
[1] http://www.businessweek.com/articles/2014-02-28/if-uber-is-k...
You forget about boro taxis and car services.