Airbnb is a peer-to-peer online marketplace and homestay network that enables people to list or rent short-term lodging in residential properties. The cost of such accommodation set by the property owner. It is the world’s fastest-growing holiday website. The company receives a percentage of service fees from both guests and hosts in conjunction with every booking. It has over 2,000,000 listings in 34,000 cities and 191 countries. It was founded in August 2008 and is privately owned and operated. The company headquarters are in San Francisco, California.
How does Airbnb work?
It works like any holiday booking site. Prospective travelers go online, select the dates they wish to travel, and pick from a list of options. It allows people to rent out their properties or spare rooms to guests. Airbnb takes 3% commission off every booking from hosts and between 6% and 12% from guests. There are various criteria to list for/search a property. You can make searches from a shared room to an entire house, to the one with a swimming pool or even a washing machine. There are photos of the property and the hosts/guests, with full map listing.
Airbnb has been fighting rental regulations in New York and all over the world since its start. It has grown to help people rent more than a million rooms in more than 190 countries. It is said to have tripled in value to $30 billion in the last two years. As we all know that New York is the largest rental market in the country. If you need a place to stay while visiting New York City, you should probably start considering options besides Airbnb.
A few days ago, Governor Andrew Cuomo signed legislation that makes it illegal for people to list entire apartments on Airbnb and similar sites for periods of less than 30 days. The new law imposes fines of up to $7,500 for violating it. On this, Assemblywoman Linda B. Rosenthal, a Manhattan Democrat who sponsored the bill said, “New York is taking a bold step that will hopefully set a standard for the rest of the country and other countries in the world that are struggling with the impact of Airbnb on affordable housing”.
Airbnb, which has tripled in value in just two years to $30 billion, is fighting hard against any regulation that would affect the number of hosts on its platform. The company cannot expand without a steadily increasing number of hosts and its rental revenue growth could slow as more cities around the world move to push potential providers of the platform.
The New York law is particularly worrisome for Airbnb. New York City is the company’s largest market in the United States. The city’s hosts generated about $1 billion in revenue last year and the company took a cut of that amount in fees. According to a report, the company said in its complaint, “The new law would impose significant immediate burdens and irreparable harm on Airbnb. In order to be assured of avoiding liability including potential criminal prosecution, Airbnb would be required to screen and review every listing a host seeks to publish”.
New York and Airbnb are at an impasse. Airbnb rejects New York’s housing laws and will not compromise unless it can help rewrite them. Politicians say they will come to the table after Airbnb removes all illegal listings. In Airbnb’s defense, Mr. Lehane, who is the head of global policy and public affairs said, “New York is the only major American city that has not worked with Airbnb to create friendlier laws. And Airbnb could someday strike a working relationship with New York lawmakers and power brokers. We haven’t been perfect and we’ve learned a lot”.