Airbnb says cap may be the key to combat greedy investment landlords

LONG-TERM renters being ditched by landlords hungry for some Airbnb profits is a problem created by the business, but it could soon be fixed.

Airbnb has a blueprint to help governments deal with greedy landlords kicking long-tern renters out on the street to chase short-term rental dollars.

AIRBNB has a plan to deal with the problem of money-hungry landlords booting out long-term tenants to cash in on the short-term rental tourist accommodation market.

Now it’s up to Australian governments to adopt it.

That was the message from Airbnb head of global policy and public affairs Chris Lehane as he discussed the growth of the business.

Sydney is number five in the world for the most Airbnb visitors — behind only Paris, London, New York and Los Angeles in terms of user numbers — and number eight globally for the number of listings.

Mr Lehane said Airbnb is continuing to work with state governments across Australia to regulate the short-term holiday rental market amid claims the online company was making Australia’s housing crisis worse, especially for renters.

The Australian Airbnb market has grown 200 per cent in the past year thanks to travellers eager to save some money, and residents wanting to make some cash letting out either a spare room or the whole property.

But with Australia, especially Sydney, in the grip of a housing affordability crisis, that success has also seen landlords in some in-demand suburbs ditch their long-term tenants in favour of richer pickings from short-term rentals.

Sydney has hit number five on the list of most popular cities with Airbnb travellers.

Recent data from the University of Sydney’s Urban Housing Lab suggests Airbnb listings are contributing to a shortage in rental homes in some high-demand Sydney suburbs.

Asked what Airbnb was doing about the damage to rental markets, Mr Lehane said Airbnb offered regulators a range of “tools”.

They include a two-tiered system where “primary” listers — those who are renting out their own homes — may be capped for a certain number of nights they are able to rent out their premises, with more stringent caps for “secondary listings” by limiting the number allowed on Airbnb.

Despite the horror tales of greedy landlords, Mr Lehane said more than 80 per cent of Airbnb listings in Australia were “primary residences” — owned and occupied by the advertised.

“Affordability is an issue a bunch of cities deal with, and the causes behind it can be very different,” Mr Lehane said.

“Where there are housing affordability issues it’s important to focus on primary listings.”

He said the ‘cap’ plan had been used in other cities.

“You can develop a regulatory approach that has a light touch for those who are genuinely using Airbnb and conducting it out of their primary residence, the homes that they live in, so that they are not necessarily impacting the long-term housing market, because these are homes that they actually lived in,” Mr Lehane said.

“Then what you do — and places like Philadelphia ... have done this and some European cities — is you put a second track in that has a heavier regulatory construct around it to deal with activities taking place in non-primary residences (which would take in investment properties).

“You’d identify these and identify places where it would make more sense to have the properties on the long-term rental market than the short-term rental market.”

He cited Amsterdam and London as cities where recent deals had been made to put caps in place.

“In some places we have created a registration system so that cities can follow it and understand what’s going on,” Mr Lehane said.

The NSW Government has been investigating the issue for the past 18 months, and in October released a report, canvassing some of this options as a way of regulating the home sharing economy.

Meanwhile, Mr Lehane also addressed one of the many bugbears for people being surrounded by Airbnb users, especially in city apartment blocks, who don’t want strangers around where they live, and cite noise, security and safety concerns as a result of short-term rentals.

“The vast majority of people who travel on the platform conduct themselves in good ways. The whole platform is based on trust,” he said.

“We have a process to identify those ‘party houses’ — which is typically what you are getting at.

“There is not very many of them, but we can work with the governments to identify them, and — we have done this in a number of places — we create a process where we will just take them off the platform.”

The threat to renters and housing affordability is ironic, given that the business was born in 2008 after two university students, struggling to pay their rent, bought some air-mattresses and rented out short-term floor space to capitalise on a local event in San Francisco.

Eight years on more than 3.5 million Australians have an Airbnb account, and 78.4 per cent of Australian adults have visited the Airbnb platform.

In Australia, listers make an average of $4500 a year and the average number of nights sold by a lister is 28, according to Airbnb.