Based on data scraped from Airbnb’s site rather than the service itself, the analysis isn’t perfect and the article doesn’t fully live up to its headline, but the Chronicle’s “Window into Airbnb’s hidden impact on S.F.” piece does provide some interesting nuggets and numbers with respect to Airbnb’s business and growth in San Francisco:
- Number of Airbnb listings for San Francisco properties in early 2012: 1,938
- Number of Airbnb listings for San Francisco properties today: 4,798
- Share of listings for rooms (versus entire home or apartment) : 38 percent
- Average price for a shared room on Airbnb in San Francisco: $80 per night
- Average price for a private room: $116 per night
- Average price for an entire apartment or home: $226 per night
- Neighborhood with the most listings: Mission District (681)
- Most expensive neighborhood: Russian Hill ($308 per night)
- Most expensive listing: $6,000 per night for the former Alioto mansion in Pac Heights
Once again, renting an apartment for less than 30 days is currently illegal in San Francisco and both a ballot measure and a new law have been drafted in an attempt to regulate the practice. It can be difficult for those who are interested in renting out their vacation rentals to potential customers. Luckily, if you are one of these people there are resources available online that could help you with marketing your villa and getting attention for your rentals.
Yes. And how many of these are being listed at these outrageous prices by people in rent-controlled units who don’t have permission from the landlord (who can’t evict them easily) to do so? Massive disrespect of property rights aided by AIRBNB and SF City Laws
And how many are unlawful <30 day apartment/flat rentals by the owners? Massive disrespect of the criminal laws aided by AirBnB due to a lack of enforcement by the city.
BTW, any landlord who becomes aware that a tenant is illegally subletting via AirBnB would be advised to start eviction proceedings immediately (yes, that is a valid ground for eviction, and the courts will support you on this). If you are aware of the conduct but do nothing about it, you will likely be precluded from trying to evict on this basis later (you will be deemed to have waived the violation).
You’re naive. It’s much harder, more time consuming and expensive to exist, even with just cause, then you lead on to believe.
As for landlords right to airbnb? We own the joint bub! If a law passes permitting airbnb type leasing, certainly landlords should be permitted, and tenants not. Most leases written today forbid subleasing w/o landlord’s permission.
Well, landlords don’t have the legal right to rent for under 30 days any more than tenants do. Just like a landlord couldn’t open up a dynamite storage facility in an apartment by claiming “we own the joint bub” neither can he violate other laws, such as those prohibiting short term rentals. I was just providing the obvious flip side to GMJ3’s “bad rent-controlled tenants” post.
And it is not that hard to exist a tenant, or to evict a tenant for that matter, when the facts on which just cause are based are undisputed, as when the tenant is openly advertising an illegal short term rental. I see it in court all the time – doesn’t even go to a jury; the landlord wins on summary judgment and it’s over. Granted, takes a lawyer and some money, so it is neither free nor painless. But it is among the simpler and quicker legal processes.
My point was, if the new legislation allowing short term renting passes, it should automatically apply to owners BUT NOT for tenants (unless the tenants lease expressly permits sub leasing.) In other words, this should be a de facto benefit to the older home owner who needs some extra income to pay for house upkeep. It should not be a vehicle for hoarder-loser-rent-control tenants to further milk the system.
How many are rooms vs. whole homes? Seems like this is the most important distinction with respect to any effect on SF housing supply. Regardless, the city is short tens of thousands of housing units, so even on the high side, AirBnB is not killing the SF home market by itself.
[Editor’s Note: See that very stat above.]
The truth is the AiBNB business was a direct result of doing something illegal in San Francisco – renting out apartments where the landlord is not notified.
END RENT CONTROL- and give back these rentals to San Franciscans.
It would not be profitable in SF if the rental laws here protected property owners.
My properties all have cameras on them, and anyone who decides to illegally sublet the apartments will be evicted.
I can see how rent control might cause more AirbnB renting by unit owners who can make lots more money running a form of hotel without the concern of having a long term tenant. But I don’t see how rent control would cause more AirbnB rentals by the tenants.
If you imagine a tenant with a rent controlled long term apartment (so called “Rent Control Royalty”) that tenant would have the least incentive to engage in AirbnB rentals. Their rent is below market and their rent controlled apartment is essentially their major “asset”. It would seem unlikely that they would knowingly put that asset at risk or certainly they wouldn’t have as much incentive to do AirbnB as a market rate, non rent controlled tenant. If I pay $1000 for a one bedroom rent-controlled apartment I would be a lot less willing to do AirbnB than if I paid $3000 for a non rent-controlled apartment.
A below-market-rate unit gives the tenant a competitive edge: They can charge less than large hotel chains, and still make it worth it. They are essentially triaging the price difference between rent control and market rent. Assuming you get the same amount of airbnb money each month, the rent-controlled tenant is getting a much higher return on his ‘asset’.
In addition, rent control only allows you to charge a roommate an equal share of the rent if you are a master tenant. No such restriction applies if you are airbnb’ing the 2nd bedroom of a rent controlled place.
I think that the word you meant is “arbitrage”. “triage” means to quickly sort problems so the most urgent issues with the greatest chance of success are addressed first.
I don’t really follow what you are saying. A rent control tenant has a whole bunch to lose if they are undermarket. A non rent control tenant has less to lose and has a much higher “carrying cost” for the unit. I think the incentives would not be for the rent control tenant to “risk it all” to get a nightly rent that might be a higher percentage of their monthly rent than if they were at a market rent. I don’t understand why the reduced rent control tenant has any more of a “competitive advantage” against a large hotel chain than a non rent controlled tenant. If I pay $3000 a month for a non rent controlled apartment, I am paying $100 per night for my place and if I rent it for 5 nights a month at $200 per night I make $1000 per month reducing my effective rent to $2000 per month without risking losing a below market tenancy. If a rent control tenant truly has a lock on a way below market rent, wouldn’t they be less likely to risk losing it by illegally subletting it using AirbnB, where the listing is publicly available? I certainly think rent control and AirbnB are topics for discussion but I don’t see how rent control tenants are the culprits here anymore than the welfare queen that Reagan claimed was buying vodka with food stamps.
rent controlled tenants have a much larger incentive to rent out rooms via AirBnB because:
1. they have a lower cost basis, and thus have much higher margins
2. they don’t consider (or care about) the possibility of getting evicted.
1. Non rent controlled tenants have a higher cost basis and that much more incentive to lay it off through AirbnB. “Margins” in this scenario really make no sense. If I’m paying more rent than I can afford I have a much larger incentive to lay off some of the cost, irrespective of margins.
2. If a rent controlled apartment is in and of itself a valuable asset, why would the rent controlled tenant not but much more inclined to consider the possibility of getting evicted?
Sorry still makes no sense. I understand some folks hate rent control but really if it is a cause of AirbnB it’s that the landlords are and have been effectively taking units off the market to use them for AirbnB or VRBO.
the margin argument is irrelevant. Rent is a sunk cost
Alright then. So why the opposition to the proposed SF law outlawing tenants from doing this?
Because the proposed laws don’t actually do that. In fact,at least one of them may make it easier for people wanting to sublet or rent a condo unit to challenge a landlord or CC&Rs standing in their way.
1. Tenants don’t own the building.
2. Tenants don’t carry the insurance or have any liability.
3. Tenants doing this show no concern for other occupants in the building.
4. Tenants are not faced w/ the rental laws that owners have to contend with.
5. Tenants don’t perform a full credit/background check on someone using such a service.
I could go on and on. In any case I think AirBnB is terrible and not worth the hassle for an owner (unless they live in a duplex and have 1 unit to rent), or a renter – because they will get evicted and will cause a nuisance to the other occupants.
Comments seem to focus on tenants subletting. Those of us who own condominium homes also have a lot to worry about. Even long-term rentals in a condo building can lead to maintenance,noise and other issues, but strangers streaming in and out on a regular basis also pose security and other issues. My HOA has rules limiting rentals to 4 per year and banning “hotel services”, but it’s a big building and I don’t believe our full time, on-site management staff routinely checks Airbnb listings for violations.
I hate them too.
Rent controlled master tenants who are allowed to sublet (usually older leases) currently lease spare rooms at market rate, often covering more than their own rent. Fixing rent-control is a more pressing issue than nitpicking about some people renting their space a few times a month.
What about the other side of it? Airbnb isn’t only a way for people to make money, it’s also a way for people to save money travelling; it’s an alternative to high priced hotels, it’s a way to stay somewhere and feel like a native instead of a tourist. There’s value to the service that can’t be summarily dismissed.
In SF some of the savings have been by not paying required taxes.
It will be much easier to assess the value of the service when it complies with the law.
If Chiu’s proposal passes, then there will be some small additional costs to “host”.
Tomslee.net has more analysis of Airbnb listings. Two interesting items:
* in SF, around 40% of visits are to hosts with multiple listings on the site.
* 2/3 of the “hosts” are renting out entire homes, not rooms.
Safe to say most Airbnb hosts are owners.
Wonkster is right: tenants in RC units who use AirBnB (illegally sublet) have a lot to lose by getting caught. There are anti-gouging laws enforced by the Rent Board against Master Tenants who charge than they pay for rent, and those who are caught are liable to reimburse tenants who they’ve gouged. Chiu’s legislation covers this by requiring all AirBnB rentals to adhere to all local laws. Landlords who catch their tenants illegally subletting can evict- it is one of the 14 ‘Just Causes’ for eviction and people have been caught and summarily evicted. IMHO, the largest issue with AirBnB is the loss of revenue generated by the hotel tax. This tax pays for infrastructure, local arts and other features that make SF a great place for tourists to visit. By skirting these taxes, AirBnB hosts are profiting off the city without paying for the services that their guests use. Hotels pay these taxes, adding cost to their accommodations, which gives AirBnB hosts an unfair advantage in addition to costing SF millions that it needs to maintain our infrastructure.