AirBnB, Regulators Mount Up!
With listings in over 34,000 cities throughout the world, AirBnB is on target to clear 80 million bookings this year, but will regulators soon run them out of town?
Which side are you on? don’t hate? or regulate? The AirBnB backlash has come in three forms, we covered Trust and Safety in the previous blog, if you haven’t already, check it now and come back; here, we’ll dig into the third, Regulations, and later take a closer look at ways they can hold customers they grab and offer a more complete travel experience.
If you haven’t heard, AirBnB has been the target of regulators... not these regulators... but city regulators wanting to reign in their disruption of the travel industry. In my city, San Francisco, next month, we’re voting on a ballot measure attempting to add even more regulations on short term rentals. But beyond SF, the crux of the issues center around:
Taxes - hotels cry foul and cities want their share
Dwelling Laws - who can rent what when?
Safety - who decides if an AirBnB room is unsafe?
While keeping focus on product, and not on politics, let’s take a closer look at ways the AirBnB Mobile App can address these issues. Add your thoughts in the comments, it’s what we do here.
One way to relieve the Host’s tax burden is to not pay them. Say what? As a Host, I want the option to not accept payment. AirBnB would still charge their fee to the Guest, but the Host’s portion would be converted - tax free - to AirBnB Credits, used at a later date, when the Host is a Guest. Similar to airline or Amex reward miles, I could book my next AirBnB stay with AirBnB Credits. I admit in advance, this may need more research into tax law, but it’s worth considering. And this is AirBnB we’re talking about, so disrupt now, ask for forgiveness later.
Charge Occupancy Tax
Hey here’s an idea: automate this already, com on! At this time, AirBnB collects occupancy tax for just 18 cities throughout the world (and all of India). If a city has hotel occupancy tax, AirBnB should pass it through to its guests; remove this from the conversation. Because, eventually, the tax man cometh, ask Amazon.
If Google can map every street in the world, AirBnB can keep track of legal restrictions in all 34,000 of their cities. At least start with major cities, like Paris, with over 60,000 AirBnB listings. The AirBnB, self help, host community is nice, but not enough. These rules must be built into the user experience, with logic to, say, prevent me from breaking the law. okay! The stakes are high enough; since their Hosts hesitating to list would be a sea-change difficult for AirBnB to navigate.
Here’s some example rules for the San Francisco Law:
Countdown timer for the 14 tax-free days per year
Prevent the 91st rental day within each year
DocuSign or other digital proof of landlord approval
These rules should guide the user experience with regulations related reminders in the Message Center. I mean, you can be laissez-faire about this when you're a startup selling cereal, but if you want to be worth the $40 billion price tag, time to deal with these less fun issues.
To spruce up your online listing, AirBnB offers professional photographers - it’s a great service and it free! AirBnB should offer the same for safety inspectors. This option would give Guests and Hosts piece of mind and maybe reason to offer these listings at a premium. Also, categories, like “childproofed” could be used to help parents filter listings.
AirBnB is an awesome service and the mobile app is clean, well designed. But there’s an opportunity to carefully address regulators while instilling in Hosts a sense of confidence that they’re keeping up with short term rental regulations, improving their user experience. Otherwise, fear, uncertainty, and doubt will creep in, causing Hosts to rethink listing and with them go AirBnB’s room inventory.