Recommendation to investigate the legality of Airbnb and

Item5.a.(f)
Rent StabilizationBoard
Date:
February
23,2015
To:
BoardCommissioners
RentStabilization
From:
JesseTownley,
Chair
Commissioner
Vice-Chair
Alejandro
Soto-Vigil,
Commissioner
AsaDodsworlh
Commissioner
Commissioner
JamesChang
Subject:
RentControlled
Units
Investigate
the legalityof AirbnbandTraditional
Recommendation:
The Boardrequeststhe Rent Boardlegalstaffto investigatewhethercurrentand futurerent
websiteviolateBerkeleyMunicipalCode 13.76and
controlledunitsmarketedon the Airbnb.com
regulations.
subsequent
Jurisdictional Statement:
on this matterbecausein June of 1980Berkeleyresidents
The RentBoardhasjurisdiction
and
passedthe City'scomprehensiverent stabilization
law, knownas the Rent Stabilization
Evictionfor GoodCauseOrdinance.(BerkeleyMunicipalCode Chapter13.76.)The Ordinance
regulatesmost residentialrents in Berkeley,providestenantswith increasedprotectionagainst
unwarrantedevictionsand is intendedto maintainaffordablehousingand preservecommunity
diversity.
Backqround:
ln 2008,Air Bed and Breakfast(Airbnb)was createdto offer"short-termlivingquarters,
breakfastand a uniquebusinessnetworkingoppodunityfor attendeeswho were unableto book
"expandedfrom air bedsand shared
In 2009,airbnb.com
a hotelin the saturatedmarket."1
spacesto a varietyof propertiesincludingentirehomesand apartments,private
rooms...properties"2
to allowfor internetrentals.
1
ia.orq/wiki/Airbn
b
wikipedia see http://en.wikiped
' l d . p g .1
2125Milvia Street,Berkeley,California94704
(981-RENT)¡ TDD: (510)981-6903¡ FAX: (510)981-4940
TEL: (510)981-7368
oDINTERNET:www.cityofberkeley.info/rent/
E-MAIL: rent@citvofberkelev.info
Severaltenantshaveindicated
thattraditional
rentcontrolled
unitshavebeenplacedon the
website.
The mostrecentnoticecamefromDanielandYenliMoorewhowrotea
airbnb.com
letterto Commissioners
Dodsworth
indicating
andSoto-Vigil
thatthe landlord
at 3100College
Avenuehavelistedandrentedseveralrentcontrolled
unitson the airbnb.com
website.
Berkeley
Municipal
Code23C.060.020
and23C.060.030
requires
thatbedandbreakfast
businesses
comport
to a varietyof regulations
including:
ownersmustlivein thebuilding
and
payalltransient
license
2014,
occupant
andbusiness
tax.OnApril29,
Berkeley
City
KrissWorthington
sponsored
a council
itemthat"Referto the CityManager
Councilmember
Tax,as
creation
of a policyfor companies
suchas Airbnbto paytheTransient
Occupancy
paidby othersmalllocalbusinesses."
currently
Thisitempassedunanimously
bythe Berkeley
CityCouncil.
To date,theCityhasnotproduced
an analysis
on thisitem.
The RentBoardis awarethatthe rentalhousingstockin Berkeley
hasskyrocketed.
lf it is true
websitereduces
thattheairbnb.com
thenumberof rentalunitsavailable
to tenants,
thenrents
willcontinueto riseat an alarmingrate.lt is imperative
for the RentBoardto investigate
how
airbnb.com
effects
tenanthousino.
TheRentBoardhasa dutyandobligation
whetheror notthetraditional
to reviewanddetermine
rentcontrolled
unitsareadversely
affectedby shorttermrentalsunderservicesprovided
by
airbnb.com.
Further,
theRentBoardlegalstaffmustdetermine
whether
traditional
rent
(BMC
units
listed
on
website
violate
the
Rent
controlled
the airbnb.com
Stabilization
Ordinace
13.76)anditsprogeny
regulations.
Conclusion:
TheRentBoardmustrequestthe RentBoardlegalstaffto determine
whetherthe currentand
futurerentcontrolled
unitsmarketed
on theAirbnb.com
websiteviolateBerkeley
Municipal
regulations.
Code13.76andsubsequent
Attachments:
1.
2.
3.
4.
Wikipedia
websitehttp://en.wi
kipedia.
ki/Airbn
oro/wi
b
LetterfromDanielandYenliMoore
Margaret
Phillips
Airbnbprofilepage
9 rentalunitsby JackandMargaret
Phillips
in Berkeley
2125Milv ia Street,Berkeley,Califor nia 94704
(981-RENT)¡ TDD: (510)981-6903o FAX: (sl0) 981-4940
TEL: (510)981-7368
¡IINTERNET: www.citvofberkelev.info/rent/
E-MAIL: rent@citvofberkeley.info
Airbnb - Wikipedia,the free encyclopedia
P a g eI o f 2 1
Airbnb
FrornWikipedia,
thefreeencyclopedia
Airbnb is a websitefor peopleto rent out lodging.ill
It hasover 800,000listingsin 33,000citiesand 192
poun¿"¿in August2008 and
countries.[2Jtlì
_êIgr
headquartered
in SanFrancisco,California,the
companyis privately owned and operatedby Airbnb,
ÑmNwNNruW
Inc.[a]
Type
Usersof the site must registerand createa personal
online profile beforeusing the site. Every propertyis
associatedwith a host whoseprofile includes
recommendations
by other users,reviewsby previous
guests,as well as a responserating and private
Industry
Socialnetworkingservice
Founded
2008
California,U.S.
Headquarters SanFrancisco,
Key people
BrianChesky,CEO
JoeGebbia,CPO
NathanBlecharczyk,CTO
Website
www.airbnb.com
(https://www.airbnb.com)
messaging
system.[5]
As of July 2011,the companyhad raised$119.8
million in venturefunding from Y Combinator,
GreylockPartners,SequoiaCapital,Andreessen
Private
Horowitz, DST Global Solutions,GeneralCatalystPartners[6]
and undisclosedamountsfrom
YouniversityVentures'partners,JawedKarim, Keith Rabois,and Kevin Hartz,[1]and from A Grade
Investments'partners,Ashton Kutcher and Guy Oseary.
In April 2074,the companyclosedon an investmentof $450 million by TPG Capitalat a valuationof
approximately
$10 billion.tsl
¡Contents
I
i
l
I History
r 1.1Internationalexpansion
2 Company
t 2.7 Locationand revenue
t 2.2 Growth
T
3 Mergersand acquisitions
t
4 Businessmodel and disruption
r 5 Operation
r 5.1 Signupand reservations
t 5.2Mobile
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org/wiki/Airbnb
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Airbnb - Wikipedia,the free encyclopedia
Page2 of21
r 5.3 Security
t 5.4 Wish lists
r 5.5Neighborhoods
r 6lmpact
r 6.1 Criticalreception
t 6.2 Cultural impact
r 7 Criticism and controversies
t 7.1Useof spam
t 7.2lncidents and renters'security
t 7.3 Financial,tax, and legalliabilities
t 7.4 Privacy and terms of use
t 7.5 Etiquette
t 7.6 CustomerService
r 8 Partiallist of competitors
r 9 Seealso
r l0 References
r llExternallinks
History
Shortlyaftermoving to SanFranciscoin October2007,Brian Cheskyand Joe Gebbiacreatedthe initial
conceptfor AirBed & Breakfastduring the IndustrialDesignConferenceheld by IndustrialDesigners
Societyof America.telThe original site offeredshort-termliving quarters,breakfastand aunique
businessnetworkingopportunityfor attendeeswho were unableto book a hotel in the saturatedmarket.
ll 0l
At the time, roommatesCheskyand Gebbiacould not afford the rent for their loft in SanFrancisco.
and
They madetheir living room into a bed and breakfast,accommodatingthree guestson air mattresses
I
ll
t
providinghomemadebreakfast.
In February2008, Harvardgraduateand technicalarchitectNathanBlecharczykjoined as the third cofounderof AirBed & Breakfast.tl2lDuring the company'sinitial stages,the foundersfocusedon highprofile eventswherealternativelodging was scarce.tt3l
The site Airbedandbreakfast.com
officially
launchedon Ausust 11. 2008.tr41
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Page3of21
To help fund the site,the founderscreatedspecialedition breakfastcereals,with presidentialcandidates
BarackObamaandJohnMcCain as the inspirationfor "ObamaO's" and "Cap'n McCains".[15]
In two
months,800 boxesof cerealwere sold at $40 each,which generatedmore than $30,000for the
company'sincubationtl6land attractedY Combinator'sPaul Graham.tlTl
After its inauguration,the site expandedto include propertiesin the market betweenhotels and
CouchSurfing.ttsl
In January2009,Y Combinatorinvited Chesky,Gebbiaand Blecharczyktojoin the
incubator'swinter sessionfor threemonthsof training.t'nlV/ith the websitealreadybuilt, they usedthe
They
$20,000Y-Combinatorinvestmentto fly to New York to meet usersand promotethe site.t20l
'West
returnedto SanFranciscowith a prof,rtablebusinessmodelto presentto
Coastinvestors.
was shortenedto Airbnb.com,and the site's content
In March 2009,the nameAirbedandbreakfast.com
had expandedfrom air bedsand sharedspacesto a variety of propertiesincluding entirehomesand
apartments,privaterooms,castles,boats,manors,treehouses,tipis, igloos, private islandsand other
properties.t2ll
One year later,therewere 15 peopleworking from Cheskyand Gebbia'sloft apartmenton Rausch
Streetin SanFrancisco.To make room for employees,Brian Cheskygaveup his bedroomand lived
through the Airbnb serviceuntil the companymoved into its first office spacs.[22ì
The companycontinuedto experiencerapid growth throughthe year and in November2010 raised$7.2
million in SeriesA funding from Greylock Partnersand SequoiaCapital,and announcedthat out of
700,000nightsbooked,80% had occurredin the pastsix months.[23]
On May 25,2011, actor and partnerat A-Grade Investments,Ashton Kutcher,announceda signifrcant
investmentin the companyand his role as a strategicbrandadvisorfor the company.[24]
In July 2014,Airbnb revealeddesignrevisionsto their site and mobile app, and introduceda new logo.
["] Sont" consideredthe new icon to be visually similar to genitalia,[26]
but a consumersurveyby
Survatashowedonly a minority of respondentsthoughtthis was the case.[27]
Internationalexpansion
In May 2011,Airbnb acquireda Germancompetitor,Accoleo.This acquisitionlaunchedthe first
internationalAirbnb office in Hamburg.['8]Then, in October20lI,Airbnb establishedits second
internationaloffice in London.t2el
Given the growth of internationalusers,Airbnb opened6 additionalintemationaloffices in early 2012.
Moscow, and SãoPaulo.t30l
Theseare in
Thesecities includeParis,Milan, Barcelona,Copenhagen,
additionto existingoffices in SanFrancisco,London,Hamburg,and Berlin whereAirbnb maintainsits
Airbnb announcedin
internationalpresencefor the EMEA marketswithin a Germanincubatorspace.[31]
September2013 thatits Europeanheadquarterswould be locatedin Dublin.t32l
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At the beginningof November2012, Cheskyannouncedhis focus on Australia,the secondlargest
Airbnb marketbehind the United States,as well as Thailandand Indonesia.To supportthis effort,
Airbnb openedits l lth office in Sydney.t'31
Th" Australianconsumeraccountsfor one-tenthof the
Airbnb userbase.[34]
Weeksafter announcingthe focus on Australia,Airbnb announcedits strategyto move more
aggressivelyinto the Asian marketwith the launchof their newestheadquarters
in Singapore.The
company'sgoal is to acquirean additional2 million propertieswithin the continent.t35l
Company
Locationand revenue
The Airbnb founding team actsas the key managerialstaff for Airbnb: Brian Chesky,Co-Founderand
Chief ExecutiveOff,rcer;Joe Gebbia,Co-Founderand Chief ProductOfficer; and NathanBlecharczyk,
Co-Founderand Chief TechnicalOfficer.t36l
Airbnb hasits twelve offices in Barcelona(Spain),Berlin (Germany),Copenhagen(Denmark),Dublin
(Ireland),London (UK), Milan, (Italy), Moscow (Russia),Paris(France),SanFrancisco(US), SãoPaulo
(Brazil), Singapore,and Sydney(Australia¡.t:zJ
Airbnb's primary sourceof revenuecomesfrom servicefeesfrom bookings.t3slFees
rangebetween60lo
and I2o/odependingon the price of the booking.Airbnb also chargesthe host 3o/ofrom eachguest
booking for credit card processing.t3el
In March 2014,the companyannouncedplansto opena new "operationalheadquarters"for North
America in Portland,Oregon,in summer2014,but indicatedthat its main North Americanheadquarters
would remainin San Francisco.[a0]
Growth
In February2011,Airbnb announcedits 1 millionth bookingsinceits inceptionin Augus1296g.t+tlt+zì
Then, in January2072, Airbnb announcedits 5 millionth night bookedinternationallythroughthe
service.[43]
Of thesebookings,75o/oof thebusinesscamefrom marketsoutsideof the continentalUnited
States.In June2072,the companyannounced10 million nights booked,doubling businessin 5 months.
[441
By October2013,Airbnb had servednine million guestssinceits foundingin August2008.ta51
In
December2013,the companyreportedit had over six million new guestsin20I3, and nearly250,000
propertieswere added in2013.ta6l
Mergers and acquisitions
http:II en.wikipedia.
orglwiki/Airbnb
2l18l20r5
Airbnb - Wikinedia.the free encvclooedia
P a g e5 o f 2 l
Sincemid-2011, Airbnb has acquiredseveralof its competitors.The first of which was Accoleo based
out of Hamburg.This becamethe company'sfirst intemationaloffice.taTl
Prior to the 2012 SummerOlympics, Airbnb acquiredLondon-basedrival CrashPadder,
subsequently
addingsix thousandinternationallistingsto its existinginventory.tosl
This acquisitionmadeAirbnb the
Iargestpeer-to-peeraccommodationswebsitein the United Kingdom.laeJ
Airbnb acquiredNabeWise,a city guide that aggregates
curatedinformationfor specifiedlocations,in
November2012.ts0)
This acquisitionshiftedthe companyfocus toward offering hyperlocal
l]
recommendations
to travelers.[5
In December 2072,Airbnb announcedthe acquisitionof Localmind.t52l
Localmind is a location-based
questionand answerplatform that allows usersto post questionsabout specificlocationsonline.These
questionsare then answeredin real-timeby expertson the specifiedterritories.ts3l
Businessmodeland disruption
Airbnb runs on a marketplaceplatform model whereit connectshostsand travelersand enables
transactionswithout owning any rooms itself.t5alSuchplatformsdisrupttraditionalindustriesby creating
new sourcesof supply and relying on curationfor developingquality.tttl Unlik. traditionalhotels,
Airbnb scalesnot by scalinginventorybut by increasingthe hostsand travelersand matchingthem with
eachother.ts6l
Operation
Airbnb is an online marketplacefor vacationrentalsthat connectsuserswith propertyto rent with users
looking to rent the space.Usersare categorizedas "Hosts" and "Guests;" both of which must register
with Airbnb using a variety of means.A valid email addressand valid telephonewere initially the only
requirementsto build a unique userprofile on the website,howeveras of April 2013,a scanof a
governmentissuedID is now required.[s7]
Profilesincludedetailssuchas userreviews and sharedsocialconnectionsto build a reputationand trust
amongusersof the marketplace.ttsl
Other elementsof the Airbnb profile include userrecommendations
and a privatemessagingsystem.t5el
In additionto providing personalinformation,hostsdisplaylisting detailsincluding price, amenities,
houserules,imagery,and detailedinformationabouttheir neighborhood.Due to the natureof the
business,a merit systemis in placeto allow guestsand hoststo leavereferencesand ratingswhich are
displayedto the public in order to provide an evaluationmethod.t60l
Since2008,the websitehas developedto include socialconnectionspulling data from socialnetworking
servicessuchas Facebook.As of May 2011,the site uncoveredover 300 million connectionsbetween
Airbnb and the Facebookuser groups.[61]
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Signup and reservations
It is free to createa listing using Airbnb. Usersfill out form with initial details.Changescan be madeat
a later date.The listing will not go live until the useris readyto publish.Pricing can be determinedby
the user.User can chargedifferent prices for nightly, weekly, and monthly staysas well as seasonal
pricing. Userscan usethe Titles and Descriptionssectionto advertisetheir space.They can outline
houserules or other descriptionsregardingthe residence.Airbnb allows usersto publish up to 24
photographsof the place.Airbnb, on a limited basis,is offering free professionalphotographyin most of
Profile is a place wherethe guestscan researchmore aboutthe users.This sectionis
the listed areas.[6t]
often usedfor usersto display who they are as well as their philosophieson hosting.t63l
Guestsare requiredto messagethe user directly throughAirbnb to ask questionsregardingthe property.
Usershave 100%control over who books their place.When a potentialguestputs in a reservation
request,the host has at least24 hoursto acceptor declinethe request.[63]
After the useracceptsa reservation,they can coordinatemeetingtimes and contactinformationwith
guests.After the reservationis complete,usersare encouragedto leavea review. Reviewshelp build
validity and referencesboth for the guestsand the host.t63l
Mobile
In additionto the Airbnb website,the companyoffers mobile applicationsfor iOS and Android
customers.As of September2012,usershad downloadedthe mobile applicationover 1 million times
which accountsfor over 260/oof the company'soveralltraffic.t6al
Throughthe mobile channelusershave all functionalityof the websitewhich includesprivatemessaging
The applicationalso allows usersto f,rnd
making communicationthreetimes fasterbetweenusers.[6t]
listingsbasedon what is availableusinggeolocation.
In December2012,Apple honoredAirbnb with the Editor'sChoiceaward for the Best Mobile
Airbnb was also awardedMost Disruptive Serviceof 20I2.t671
Application of 2012in the UK market.t66l
addingthe ability for
In November 2073Airbnb launchednew versionsof its iOS and Android apps,[68]
guest
messages.
hoststo communicatewith guestsand responddirectly to
Security
reviews,and ratingsto build credibleonline reputations
Airbnb userprofiles containrecommendations,
within the platform.Additionally, the site providesa privatemessagingsystemas a channelfor usersto
Hostsare neverrequiredto
messageone anotherprivately beforebooking and acceptingreservations.t6el
After the guesthas checkedout, the partiesreview one anotherto build website
accepta reservation.ttOl
like eBay.
credibilitysimilarto onlinemarketplaces
org/wiki/Airbnb
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PageTof21
Airbnb facilitatesonline paymentsfrom guestto host throughits SecurityPaymentsfeaturewhich
processespaymenttransactions24 hoursafter checkin.tTllThis protocol offers a guaranteefor guests
and helps to uphold host cancellationspolicies beforeprocessingpayments.Additionally, the Airbnb
websitefacilitatessecuritydepositsand cleaningfees,the former of which is held until the propertyis
vacated.The company'srevenuecomesfrom a 6%oto 12o/ocommissionof the guestpaymentand 3Yoof
what the host receiv.r.[t']
Any Airbnb host can now requiretheir prospectivegueststo obtainVerified IDs beforebooking.
Initially trust was tit-for-tat so any host who requeststhis conditionmust also get verified. Howeverthis
hasbeenchangedsuchthat all guestsmust have a verified ID beforebooking.tT3l
Wish lists
In June2012, Airbnb launcheda wish list featureoffering usersthe ability to createa curatedcatalogof
desiredlisting they would like to visit.tTalCo-Founderand Chief ProductOfficer, Joe Gebbiaand his
team conceivedthe idea of changingthe websitefrom an online marketplaceto a sourcefor aspiration.
Userscan curatetheir favorite destinationsinto organizedlists and sharethesewith otherusers.[tt]Since
the launchof the Wish List functionality in June2012,engagementwith the Airbnb websiteincreased
by 30%.45o/oof usersengagewith Wish Lists and had addedover 1 million accommodations
to
personalizedlists.t76l
In creatingWish Lists, the product team designeda proprietary"info scrolling system"which allows
usersto engagewith theselists without the websiteslowing down the userexperience.Additionally,
Airbnb open sourcedthe code,Infinity.js to the softwaredevelopercommunity.tTTl
Neighborhoods
In November 2012,Airbnb launchedthe Neighborhoodsproduct.[78]
This travel guide helpstravelers
chooseto the ideal neighborhoodmatchbasedon a seriesof collaborativefilters and attributessuchas
GreatTransit,Dining, Peace& Quiet, Nightlife, Touristy, and Shopping.tTel
Currently,the
Neighborhoodsproductis enabledfor SanFrancisco,New York, London, Paris,Berlin, Washington,
D.C., and Rio de Janeirogiving in-depthinformationfor selectedneighborhoodsin thesecities through
photos,essays,maps,tagsfrom locals,and assessments
of public transportation.tsOl
The Airbnb productteamhand-mapped300 neighborhoodswithin thesesevencities and had local
editorscuratecontentfor eachneighborhood.Airbnb also added70 streetphotographerswho generated
for the project.tsrl
40,000photographs
Impact
Critical reception
The foundersof Airbnb havebeenpraisedfor tenacityand creativityby Paul Graham(co-founderof Y-
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org/wiki/Airbnb
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P a g e8 o f 2 1
Combinator,Airbnb's incubator)t821
and The Walt StreetJournal.Í831
Airbnb hasbeencomparedto Craigslist,HomeAway,Flip Key, WorldEscape,Uproost,and Groupon,
Airbnb won the "breakoutapp" awardat the 2011
other sitesthat offer spur-of-the-momentrentals.l8a]
Southby Southwestconferen...[tt] Along with Quoraand Dropbox, TheNew York Timeslisted Airbnb
Following Airbnb, other servicessuchas
amongthe next generationof multibillion dollar start-ups.[86]
Getaround,Vayable,Guidehop,myTaskAngeland Task Rabbit launchedwith a similar model.tsTl
New York's statelegislaturepasseda law in July 2010 making it illegal to rent out ClassA residential
spacefor lessthan 30 days.However,the bill's sponsor,StateSenatorLiz Krueger saidAirbnb and its
In Quebec,the governmenthasspecificallytargetedindividuals
competitorsare not the law's target.tssl
rentingout their homesand apartmentsthroughAirbnb.tsel
Cultural impact
In July 2010,the companyreceivedmore than 300 emails from peoplewho were on the brink of losing
their homesthroughforeclosuredue to financialhardshipfrom the economicrecession;thesepeople
Non
saidthat they dependedon their continuedability to subletroomsin their residences.le0l
homeowningusersalso frequentlysublettheir homesto rentersfor prolongedperiods- often a breachof
tenancy.[el]Yet a July 2014 ruling nixed a landlord'seviction plansafter his New York City tenant
sublether unit throughAirbnb. The judge found that local laws prohibiting short-termsubletsonly apply
to landlords,potentiallyopeningthe doorsto many more subletsthrough Airbnb in the coming months
and years.Thoughthis ruling setsa pro-subletprecedent,landlordswho ask tenantsto stoptheir
practiceswill still expectcompliance.te2l
Airbnb is als6 appealingto luxury homeowners.While most wealthy homeownerswould havenever
consideredrenting out their propertiesover traditionalbulletin boards,classifiedads,or Internetsites
like Craigslist,Airbnb offers a much more reliableservicefor affluent usersto earnrevenuefrom their
This phenomenonhas causedmuch discoursefor the American Hotel & Lodging
secondhomes.[e3]
Associationas short-termprivate rentalscontinueto disrupt the hospitalityindustry.teal
In November2012,Airbnb commissionedHR&A Advisors to conducta study which measuredthe
marketimpactof collaborativeconsumptionby userswithin urbanpopulations.Specifically,the study
The study found that
measuredthe impact thesecompanieshad on the economyof SanFrancisco.les]
from April 2011 to }i4ay2012,guestsand hostsutilizing the servicecontributed$56 million in spending
Over 90% of
within the SanFranciscoeconomy,$43.1million of which supportedlocal busin"sses.[e6]
hostssurveyedrentedtheir primary residencesto visitors on an occasionalbasis,and spentnearly half
the incomethey make on living expenses.The study also found the averagegueststaywas 5.5 days,
comparedto 3.5 daysfor hotel guests,and the averageguestspent$1,045during their stay,comparedto
the $840spentby hotel guests.teTl
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In the aftermathof HurricaneSandy,Airbnb partneredwith New York City Mayor Michael Bloomberg
Airbnb built a micrositefor this effort alone
to offer fi'eehousingfor personsdisplacedby the storm.[e8]
Additionally, Airbnb
wherevictims registerfor housingand meetpropertyownerswith free housing.teel
waivedall servicefeesassociatedwith theselistinss while maintaininethe Host Guaranteefor all
propertieslisted.tIool
Criticism and controversies
Usc of spam
In June2011,bloggerand competitorDave Goodenclaimedthat questionablesalespracticesincluding
sendingmass,automatedemails to propertyownerson Craigslistled to Airbnb's successas an Internet
startupcompany.t'0llThis user acquisitiontactic was usedalong with severalotherswhen building the
companybusinessin2009. However, the companyfound the practicelargely ineffective.tr02l
lncidentsand rentersfsecurity
In July 2011,therewere first reportsfrom a host, "EJ", who had her apartmentburglarizedand
Aft". 14 hoursof no response,Airbnb initially indicatedthat they
vandalizedby an Airbnb guest.tr03l[t0o]
Th.y laterreversedthis decisionamidst
would not compensate
the host for damages.t'03ltlOslll06l[l0t]
public backlash.tl03l
After three days of helping the victim, sheclaimsAirbnb encouragedher to remove
her cornplaintnoting the "potentially negativeimpact" it could have on the company,and stopped
po11o*ingthe incident,more hostscameforward expressing
contactingher completely.tl03Ìtlo0ltt07J
similar experiences,including a man whosehomehad beenrentedthrough Airbnb to a meth addictwho
later stolethe host'sbirth certificate,went through "everythinghe owned," and causedthousandsof
He expressedsimilar dissatisfactionwith Airbnb's responseto the situation.
dollarsin damage.[107][108]
lrOsllrOel
Airbnb recommendshostsobtain insurancewhich coversdamagescausedby guests.tll0lAirbnb offers
calling it a hostguarantee.[lll]
secondaryinsurance,
In responseto the propertydamagesclaims,Airbnb launchedits "The Airbnb Host Guarantee"property
protectionprogramin August 2011 which coveredpropertyloss or damagedue to vandalismand theft
the companyinitiateda24-hourcustomerservicehotline,
for up to $50,000.tll2lAdditionally,
establisheda taskforceto review suspiciousactivity, and implementeda suite of securityfeatures.['13]
In2012, two prostitutesrentedan apartmentwhich the police raided.tlral
In March 2014,comedianand entrepreneur,Ari Teman,leasedhis New York apartment.Under the
guiseof using the spacefor relatives,it was rentedfor the purposesof an orgy. Teman saidthat $87,000
in damageswere causedand that the building is consideringhis eviction.The guestshad referencesand
I5]
verifiedtheir account.Il
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In New York, a numberof cooperativesand condominiumsnow scanAirBnb seekingto determineif
any apartmentsin their buildings are listed for rent.Irl6]
Financialotax, and legalliabilities
In January2013,Airbnb userNigel Warren facedthe prospectof paying fines to New York City for
renting his room on Airbnb. The casewas madethat certainlanguagein New York's administrativecode
allowed temporaryrentersto lawfully stay for periodsunder30 days.On 20 May 2013 a New York City
administrativelaw judge, Clive Morrick, disagreedwith this interpretationciting Mr. Warrena $2,400
fine.[ll7]This new ruling doesnot makeusingthe service"illegal",as long as staysare for more than29
tal
days.If not, usersdo standthe chanceof facing fines per New York City.tt
In January2014 the FederalCourt of Germanyruled that a transferof residenceto touristsis not covered
by a permissionto sublet.In this casethe tenantwas previouslywarnedby the landlords.A pendingnew
casecentersaroundthe questionif even a terminationwithout notice is possibleif no explicit permission
from the landlordis obtained.tllel
by Airbnb itself,in fiscal year20ll-2072, Airbnb shouldhave
Accordingto a studycommissioned
collectedandremitted$ 1.9million to the City of SanFrancisco,but they haveyet to do so as of 2014.
lr20l
whetheryou rent or own your
In SanFrancisco,Airbnb hostingis illegal undermost circumstances
property.Airbnb hostshave beenfined by the city and receivedeviction noticesfrom landlords.I12l]
Airbnb hostingis also illegal in New York City undermany circumstances.[122]
Privacy and terms of use
is perceived
The new identity verification system"Verified ID" (initially announcedin April 20131123\
Jt requiresthree layersof
by customersas excessivelyintrusiveand "creepy."[124)Ít2slu26][r27]tl28l
customeridentification:telephone,photo of ID (suchas passportor driver'slicense),and verificationof
Facebook,Linkedin or Google* account.It is impossibleto usethe systemif one of thesedatais not
provided.
New userswho do not have a suitablesocialmediaaccountor one that Airbnb considerunacceptable
(suchas a Facebookaccountwith fewer than 100 friends)are requiredto submit a webcamvideo
recordingof themselvesto Airbnb as an alternativeform of i¿. ttzelttr0ì
Linguist Mark Libermanhas criticizedthe extremelengthof the legal agreementsthat Airbnb members
are requiredto accept,with the site'sterms of service,privacy policy and other policies amountingto
"55081words,or aboutthe size of a shortnovel, thoughmuch lessreadable",requiring severalhoursof
readingtime.tl3ll
org/wiki/Airbnb
http://en.wikipedia.
2t18/2015
Airbnb - Wikipedia, the free encyclopedia
Page1I ofZl
Despitehaving no explicit ban on hostsfilming guests,Airbnb updatedits terms of use in November
2014to requirehoststo fully disclosethe useto surveillanceequipmentand securitycamerasto guests.
[132]
Previously,no suchdisclosurewas requirs¿.tI33ì
Etiquette
The etiquetteof Airbnb hostshas also come under criticism, citing unreasonablecheckoutduties,long
wait times for hosts' keys and unkemptrentalproperties.[l3a]
CustomerService
Airbnb scoresbad on TrustPilotwith a scoreof 2.9 out of 10tl3slandhasover 130complaintslistedon
PissedConsu.".."o*.[''u]
Partial list of competitors
r 9flats
r Alterkeys
¡ BeWelcome
r CouchSurfing
r Flat-Club
r HomeAway
r Hospitality Club
r Hospitalityservice
r HouseTrip
r PasportaServo
r Roomorama
r ServasOpen Doors
r SleepOut.com
r Travelmob
r Tripping
r VacationRentalsBy Owner
r Wimdu
Seealso
r Online platforms for collaborativeconsumption
http://en.wikipedia.org/wiki/Airbnb
2t18t201s
D a n i eal n dY e n lM
i oore
3100College
ave.#6
Berkeley,
CA94705
To the membersof the CityCouncil:
apartment
I'mwritingto requestyourattentionto the growingthreatfrom Airbnbandothershort-term
rental
market
in
Berkeley.
rentalbusinesses
to the
My wife and I havelivedin Berkeleyfor elevenyearsin the samebuilding.Our landlords,
Jackand
MargaretPhillips,
Services,
currentlyhavenine Airbnblistingsamongseveral
dba Trust Management
Asof today,threeof the twelveunitsin our buildingarebeing
apartment
buildings
theyown in Berkeley.
offeredas Airbnbrentals.Thesewere oncerent-controlled
apartments
and are no longeravailable
to
thoseseeking
long-term
tenancy.
Citiessuchas NewYorkandSanFrancisco
haverecognized
the seriousthreatthat the lossof apartment
rentalhousingto
rentalsposeand haveenactedstrictnew lawsto ensurethe availability
of affordable
theirresidents.
Avenuewas builtin 1920and
I wishto adda morepersonalpointas well.Our buildingat 3L00College
has very poor sound insulation.lt has been professionally
tested and found not to meet modern
standards.
Onlywhen all our building's
occupants
are awareof the challenges
of livingquietlytogether
canit remaina placeof quietenjoyment,
to whichwe areall entitled.
Airbnbhasreplacedour quiet environment
with noise,anxietyand the nuisance
of a steadyflow of
who haveno investment
in livinghere.Thelandlordhassetthe minimumstayon Airbnbunits
transients
to onlythreedays.Thatmeansthat in aslittleaseverythreedayswe couldbe facedwith the impactfrom
yet anothernewsetof transients
with no stakein our homeenvironment.
The introduction
of Airbnbto the buildinghasturnedthe home of a quiet and respectfulgroupof
-professionalswith the knowledgeand understanding
of what it takesto live comfortably
with each
other-- into an unpredictable,
sometimes
chaotic"anythinggoes"environment.
As lwrite, there is a
familyof fivefloppingin the one-bedroom
unitaboveus,andit'sbeen,an unpleasant
experience,
to put
it kindly.Theseintolerable
newconditions
aredrivingusout of the apartmentwe'veenjoyedfor so many
years.We are lookingfor a new placeto live,but that'sgettinghardereverydaydueto the incentive
of
guests,but if we'resuccessful,
rakingin muchhigherprofitsvia suchshort-term
it will leaveone more
vacantapartment
to be filledwith high-paying
vagabonds.
The Berkeley
Department
of Planning
& Development
hasinformedus that underBerkeley
Municipal
CodeSection
23C.06.O2O
and23C.06.030,
whatour landlordis doingis illegal.
P l e a sceo n s i d e r t hdea m a g e
t h i sp o p u l a r t r e nidsd o i n g t oB e r k e l e yp' sr e s e nat n df u t u r er e s i d e n tasn di t s
shrinking
rentalmarketand adoptand enforcerestrictive
measures
suchas havebeenimposedby the
citiesof 5anFrancisco
and NewYorkto reduceor eliminate
thissignificant
andgrowingthreat.
Sihcerely,
i oore
D a n i eal n dY e n lM
ffin
5Êâri¡ rlii¡r Gtr)çti.j
Ë¡
¿$ u*rhnb
l.J!.a:rÊ éiÈ yoù
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s
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tlelp
H*yoI'm Margaretl
Sån Cárlos.
CI
+
Californla,
United Stâtês . Member
sirìce Augüs:
2013
Borñ irì :nglaÊd, ùcv! llv¡tìgìn CEliforniÈfor mañ't yea¡Ð. Tvro {i} gradunte degrees frúm iJC Eerkeley. Frequew
lravel - l¡red rí chain hôîels. I håÌÊ beeÐ ån A¡rhih g{Áesl in thÈ lls erri sê,!,eíalcll€r ccullries ånd have
àtÞreci3led the erperieÐce oi âi6y¡ng ;n a reFl â9mÉ, ô pls!ìÊ'iJith vJårñ1thêrd Êhãrñcle¡, iã ðn inlårestinU r"¡elkabìe
ìe¡qhhorhood, ThâÌ's \abet my co'hðsr (mt, hushand Jâck) Énd I Õfip,f ydtr, fôr, in BÊ.kgiÊry - ã vil)ráot iÕ'¡r'n vJilh ên
:ôlertrat¡oÐaliy r;nowned
uÐìversitt, distirìcii\.e :rclriteqt$Íe, irrevñiive resl¡urêsts. sÈríèur cofies hsrsçs.
bookstores, Farks, musÐurìlsr thêatÐr, a lively nusìc scena * and carvsÌrîenlly clcsp lc Sar Fra¡cÍscc,
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Greêt st¡rdio spåc,e. ñot â1 âlÌ sniâll-iÊÉ¡1Ð9, âîd rc,ally nifrel./ T[r!ì:shÊd: I .¡¡ã5 the tirst qüesi to
eler stãy herÉ énd I hrdi't e-vë* reeÐ pholDs bËfsie I bookedihoug¡
I'm reùlv glõ,:lI did. ThËrË
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,About Me
School
l:e:r:r+ary 2'i15
tJC Berkeley
jì uiiiè
^
Lè
Work
l'lt.i fì'i"r
llü\lùçC
ijlì;dìq
Freclaåce
À,1srEèrai'shouse was thè kêy to my sùccesstul lr:p'ie Eerkål€ylli On thè i.( al lie( I åfl'Jq¿ !p
goìng to tiìê ËR, sÌlir ÇoilsequeilGsu lhíìL I aru slilì lõr:ìr:9,yel. îll 1liß l¡ail been oveiçur¡e bf tht¡
M à r g¡ r€l's A¡r bn b $Ì,mbol
wcndÊrfü? hÐusp. Ðr6ep:ional localigl v¿av¿are il, ârìd âow well !.JÐ*.ÈaÉ tsking cerê cl, TiÞ
l¡{,ql11ã
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i/ìsit crÉiÉte.alìb9[,crÊì
We slayed lor Ltìiee day3, vîsÌfing our 9oâ !"ho ¡s stud./ìng å1 ûetlaÐ|"y. LÐte;ly áç4lErtment. Niti
Þ
v{oÞdËF flocrs, hiçh c":lir'qs and fa:lefqlly decciåted¡ ãs ehov{r in the phètos. 10 ñiñs rÊlk Ìo
tha Êèmpil5, ånd íust r iÞu nínu1Ês yralk arla). Irom ihe Eeíglibúurhoùrd erÈa oi Ëimroc.d. i¿lê
w
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Our slay âi Margar€t's liace wås Épdeci: \Sp rsêll)' íeli si home, T!ìÉ splrtm€ni was sÞãc¡ous,
clFlÐ aÐd cmtortêb:e,
The neÌghborhrcd is qulet aîd rÊaìly iiÉsDtifü!, close to UC 8ârkelÊ!,
üÐpus. Margarcl Ii an ÐrcellÐnt húrl. ghe wa€ ¡vailtn:c. fsÞiled t" eut nìessíOsâ cu¡cklt, !ild
s'âower.l súppoÉr sllìenp-vÊr wÉ reeded lt^ | hlghly recÐmmerd
fhis plecp- for a sboñ or iorgpr
etay- Thankå [4årgaretl
,ia?>,.iÃïl '?1.J1í
'i1 Í:tiiiriiì :lr¡rA ¡ÍÉ.jit.,ifr¡Ìirisü
iri!,,íiiiíir.l
-fhc
À4årqaret's f)lace wáç i.le;i.
aÞaf,se$t is is 6Ê-sc.;llâd í¡ the flrst åÐd íi r.'.s Feú"911{:r ne.
! êtien,led a tra¡rinc gÊ tbe UC Bel:eley c;nprs
and it r"/as ã short 15 Ðinule l,r'nlk. l,,largãrÈÍ
W
was 50 thoug¡rtiul to providÉ lrÊsiì lrdit, iu¡ce, à¡d ñilk. I hÉ sFace !va3 clean ard beautijul- f h"
cireck-in p.oçeFs'dJa5ð breeze, as I w¿s nìel;mme{,iêlefy by Binyõñ, tularqaíel's ploperty
nìanagcr. Shaüld | ûlake my lvây to Berkeiey egair, l.¡1ould rÐs¡ d9f¡¡;tely sley at cne cf
Margðrct's lìsti!ìgâ.
,iatw¿:!
2ûiii
'ì ti'jii-sh ôrç h..ti((3,)..'. i:r:ülaii
ilea
Vi':1,.;¡ìJiÌst¡iì!5
Mirgãret is rn excellent hcst, ThÉ BFãFreql
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lccãtÞC i5 yDU a¡È
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.i¿¡:r¡ery 2üi5
l> ç>f,aßri&rJ ¡i Spàcictir lilrì-;wñcrj lilJi:,)
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