The City of Boston recently enacted regulations that severely restrict property owners from renting out their homes by the night, unless the owner lives in the unit - a move aimed squarely at Airbnb.
I don't have a dog in this hunt, but it seems to me that restricting an owner's use of his own private property without compensation is just reprehensible, so long as it doesn't cause a hardship to others
Placing a pig farm in a residential neighborhood seems like an unreasonable burden to others. Having guests sleep in your property doesn't.
Well, Airbnb is fighting back. They've sued the City of Boston.
"The lawsuit filed Tuesday in federal court says the ordinance violates state and federal law by forcing home-sharing platforms to share information about clients with the city and requiring the platforms to enforce the new rules."
https://boston.cbslocal.com/2018/11/13/airbnb-sues...
Godspeed, Airbnb. Enough of Regulation Nation.
The argument that the government is taking away home owners rights is BS. If the owner does not live full time in the property he is not a home owner. If investors are not allowed to do what they want they don't invest. They go else where or invest in something else. No crime no fowl.
That seems like a bizarre standard. if I own a car that I do not commute to work in on a daily basis, does this mean that I do not own this car?
@Charlie MacPherson it seems reasonable to me. They are just protecting the quality of the community. It is no different than limiting any other commercial business in a residential neighborhood.
A community is built through long term residents. Continually having strangers coming and going does not improve a neighborhood. There is no pride of ownership, because nobody is living there. In some cases the owners don't even live in state.
Laws are just catching up with Airbnb as they should.
Exactly. I don't understand why people make it so difficult. They get mad when they want to operate a hotel without regulation. They feel like they are being singled out, but they should ask all the hotels that have been complying with these laws for decades. Don't complain. Its the cost of doing business.
@Eric C.
@Eric C.
Wow, where do I begin?
1) we absolutely can compare Airbnb’s to hotels. If we are talking about what’s best for locals then hell yes strs are way Way better than hotels. There is a cheap motel a half mile away from me and the cops are always there. I am (and Airbnb/vrbo in general) is way better at limiting crime and benefiting the citizens of my city than hotels.
2) are my “assumptions” wrong. I have a vacation rental and you don’t. You are telling me that my experiences are assumptions? I brushed my teeth this morning, is that an assumption? Based on me cleaning my own property for the first 6 months, seeing what ppl leave and based on what guests tell me, yes I assume they spend money even more locally than if they stayed at a hotel. Don’t tell me my experiences are assumptions. I “assume” you are not an expert on this matter but you are still in favor of regulating me!
3) the question is not about legality, it’s about what’s the law should be. The law should be: what’s best for the people? I am illustrating that strs are good for all the parties involved including a third party that is often disregarded in these discussions: the cleaners and other professionals I employ.
4) again, you clearly do not own a str and yes, you made up that number. They #1 thing guests search by are by review and some guests can be very fickle. They’ve even gotten mad at me for problems they cause. There is an element of customer service that you need to be careful of. You may be able to get by renting a 4 star rating hotel, but with strs, customers don’t know what to expect so they are trusting reviews a lot more. 80%? Try 98%.
5) it seems that you are conceding my point but you are saying it still doesn’t matter because we need to regulate every industry. I pay my taxes (more reliably than my neighbors). Regulating me out of business will hurt the community.
By the way: my roi, or success, or failure is none of your business if I’m not hurting anybody. I took a sober risk when investing and yes, part of that risk is gov regulation. That remains my #1 biggest risk but it is based on people fearing a new industry. That’s it: fear. People always fear new industries abd successful market dIsruptors and look to the gov to regulate their fears away. Strs are not destroying your community they are enriching it. Live and let live!
1). Cool if we compare hotels to a Airbnb then you yourself are stating it doesn’t belong in a residential neighborhood, glad we agree on that point.
2). If you have to use the word assume a lot... did you also previously clean hotel rooms to have good comparison to spout your mouth off like an expert.
3). STR's are not good for all people involved, it's good for YOU, but as a community as a whole it is horrible. I use facts and logic with my asserations. What do you use? You ROI that you won't disclose... that's more to my point that you are part of the problem and not a problem solver.
4). Again I don't own one, but I do own a home and I live an in area that has STR's and seen first hand how they negatively effect the locals.
5). I'm not conceding anything. I am using logic and facts. Your using emotion and ramblings. Your STR is nothing more an unregulated hotel that has a different flavor to it. Once you have to start paying your fair share of taxes for each booking you will have to join the world of reality.
Again not knocking STR, but I am saying that short term gain for you is nothing more then long term loss for the community. If you want to do STR rentals that's your right, for now, but eventually like everything the government will come and get their seven pounds of flesh.
Yes you are hurting people, you just turn a blind eye to it because it’s easier then seeing things from the other persons point of view. I see your POV but I can also see the big picture and how without regulation you are hurting the community at your own personal gain.
@Eric C.
@Eric C.
That remains my #1 biggest risk but it is based on people fearing a new industry. That’s it: fear. People always fear new industries abd successful market dIsruptors and look to the gov to regulate their fears away. Strs are not destroying your community they are enriching it. Live and let live!
That is an incorrect assumption I believe. I do not believe that the people who want str's regulated fear them. Im an avid user of short term rentals. I prefer them to hotels because I find staying in them is easier with my dog than staying in hotels.
However I dont want them in my neighborhood. I was just part of a lobbying effort for their restriction in my locale, which is larger than the city of Boston. I think everyone involved were users of short term rentals and no one feared them. We simply wanted restrictions and regulations on their use. We were able to get the regulations passed fairly easily as no one really opposed them, so it passed our county council with a unanimous vote. (Maryland operates on a County govt system, not a city like other areas)
There were no mass protests by short term rental owners, because they represent only a tiny fraction of the population, at least here, compared against home owners.
It's like a game of hot potato and more then likely situation is the STR crowd overpaid for their property and once the rule of law catches up to them they will be caught holding the bag of an upside down or zero equity home with only a negative cash flowing long term rental situation to maintain them for decades to dig themselves out.
The STR rights end where my rights begin. I love the debate. And Boston will win this fight which I've seen in the past. Every investment strategy has risk, welcome to the beginning of the end.
STR are simply hotels disguised as houses. They should be regulated just as any other hotel. There are many areas with mixed use zoning where you'll see business & residential side by side. That's a fine place for a STR / hotel as that's what everyone who lives or operates a business in the mixed use zone signed up for.
Likewise there are neighborhoods that are zoned purely residential. The people who live there signed up to live in a neighborhood with no businesses next to their homes. To think you can just slap a hotel in the middle of a residentially zoned cul de sac is naive.
STR are simply hotels disguised as houses. They should be regulated just as any other hotel. There are many areas with mixed use zoning where you'll see business & residential side by side. That's a fine place for a STR / hotel as that's what everyone who lives or operates a business in the mixed use zone signed up for.
Likewise there are neighborhoods that are zoned purely residential. The people who live there signed up to live in a neighborhood with no businesses next to their homes. To think you can just slap a hotel in the middle of a residentially zoned cul de sac is naive.
Calling a STR the same as a hotel is whats naive. You're judging a book by its cover here. Even worse your judging one book by its cover but your judgin solely on the fact that it looks similar to another book thats on the same topic but completely different. They are similar in a lot of ways but not the same. You might as well call a 2 story 4-plex and a 7 story mid rise 40 unit apt tower the same thing because thats about how similar they are to each other. The thing you, and everyone wanting to outright ban STR in residential zones, have to consider here is scale. Comparing a hotel that houses dozens to hundreds of people and employes just as many as well is completely different. How they are operated, taxed, regulated, zoned, built, its market, its offerings and client expectations are completely different. About the only thing that is the same is that someone is renting a bed to sleep in for a couple nights.
As its been mentioned before but whats your definition of a business? So anyone working from home in any field can no longer work from home? Should we make home offices illegal in residences that are in in mix use zones? Can I no longer make something in my garage and sell it online?
I'm all for imposing regulations, taxes, permits, etc. but outright bans, in any area, is a foolish thing to do 99% of the time. The only reason I see bans being reasonable, and even then I think there could be a better solution than a ban, is tiny vacation towns that dont have the economy of scale on their side and the lose of business and lose of affordable local housing is actually at risk. But large cities and their suburbs shouldn't have this kind of problem and really most small towns wont either.
Personal opinions aside, like it or not, courts have ruled time and time again that cities are within their rights to regulate STR's as they see fit, and many are planning to do so if they haven't already. The question of whether or not they can was decided years ago, now the question is to what degree can they. STR's have consistently been ruled as commercial activity and thereby subject to zoning, taxes and regulations like any other business. The assertion that STR regulations infringe on personal property rights has limited legal basis, as overwhelmingly courts have ruled that the rights of STR owner/operators does not supersede the rights of their neighbors who bought in with the expectation that commercial activity would not be allowed in a residentially zoned area.
AirBNB knows they wouldn't win a case to overturn any of Boston's regulations, as they've lost every similar battle against other cities, even in their own hometown San Francisco, so the legal precedent is extremely strong against them. The current suit against Boston is not about overturning regulations. AirBNB is suing because in addition to regulating Boston also wants to make online listing providers entirely responsible for enforcement and liable for the actions of the sites users, which is a step beyond what even the strictest cities such as Santa Barbara and Jackson Hole have done. What AirBNB is trying to achieve with this suit is to shed liability to their hosts, to not be responsible for enforcement, and to stem the flow of the tide against them as DC and other areas get ready to kick their own new rules into gear.
There is so much rhetoric in comments made here but seems to be based in hear say and prejudice rather than fact. AirBnb may have started as a crash pad, couch surfing, frat party crowd but it is not that way now from my experience. Sure, there is still probably some of that out there but to say that as a blanket comment is purely out of touch with how it operates today. It's not a downgrade to the hotel experience. In many cases it's an upgrade. Half of my bookings come from AirBnb and they are families, couples, people with discretionary income paying over $200/night. These are folks seeking a different type of experience from a hotel and are not direct competitors to hotels. They want the comforts of home and this is just how they travel. Most of the time our guests are paying higher to us than a night in a hotel. I'm all for playing by the rules to make sure that it's safe for guests (health inspections), permitted, abiding by city ordinances, and paying room taxes and the sales tax that all the other industries have to pay. Rather than restricting they should be creating regulations around how AirBnb's can be operated within reasonable guidelines and then enforcing those guidelines. They should be looking to other municipalities that are doing this well. It's a good source of additional revenue if they let it be. This is especially true when demand for lodging is high (i.e. Boston Marathon). I spoke to our local REIA the other night about vacation rentals and one of the biggest things I run into is that people don't know they aren't operating legally. In one county we operate though, they watch the platforms and contact owners when new listings come up. They help owners become legal and get their tax revenues in the process. Restricting STR is not a winning situation for anyone and is really small thinking.
@Mike V. your post clearly, in my opinion, gives support to Boston's implement regulations requiring STRs to have the owner in residence. All the examples you give of businesses operating out of a private home have the home owner living in the property. Boston is only requiring STRs to do the same. To me that is a compromise as opposed to banning them entirely and would be consistent with all other business operations conducted out of persons homes.
If you want your property to be 100% business locate in a business district. If you want to set it up in a residential community do as all others do and be a home owner in residence. That is all that is required and a logical compromise.
Building codes will not permit me to convert a store on the main street business district in your town into a personal home so conversely it makes scenes that a home in my community should not be permitted to be turned into a full time business. Home/business I can live with that within reason based on local codes.
Bigger pockets is supposed to be a community of investors, PROFIT motivates us. I might be speaking for myself. Why any of you all would want government over reach, regulations, is beyond my understanding.
Less government, not more.
Bigger pockets is supposed to be a community of investors, PROFIT motivates us. I might be speaking for myself. Why any of you all would want government over reach, regulations, is beyond my understanding.
Less government, not more.
My single largest position in any asset is my primary residence and that is the case for most investors. Some of us want to protect the PROFIT in that asset.
@Russell Brazil Nice point but do STR's lower property value ?
@Russell Brazil Nice point but do STR's lower property value ?
A blanket statement for any 1 cause have a singularly same effect on all types of real estate in all places would be wrong.
Are there properties whose value would be diminished by strs? Absolutely. Are there properties whose value would go up because of strs? Absolutely.
But for any specific location, it should be the choice of the residents there to choose whether to allow them or not. When we lobbied to have them regulated here in Montgomery County MD, (the largest jurisdiction in the DC area) what the residents wanted was overwhelmingly clear, and was such so that the vote to regulate them happened with a unanimous vote.
Now I doubt that residents of beach towns would want restrictions on their strs. And that is up to them then to lobby their officials to make sure that doesnt happen.
@Maugno M. There's no way to prove that an STR will lower property values by itself, there are too many variables that contribute to the increases or decreases of property values. Nowhere will you find on a RE sales document the property is being sold at a loss due to the STR next door.
Unfortunately most people in business don't have the vision or understanding of the entire business processes for any given business they are participating in. You're asking why government overreach would be ok, it's about more profit. You're looking at this from your tunneled vision position of making money off of your rental asset only, look at it from a complete business cycle position, you're basically saying do regulate me, but regulate everyone I use to build or rehab my money making asset.
Yo want no regulation or industry standards for the STR's, you're ok with this because it works for you, imagine now if the Natural Stone Institute had no standards or regulations for the countertops you're installing in your units and now you're emitting toxic chemicals for all of your guest, then take this scenario onto the plumbing pipes, now look at the flooring requirements, If everyone who has some sort of profit benefit in your Asset took the same position and wanted no government oversight or regulation in the name of individual tunneled vision profit, we'll be back where we were in the 60 and 70 with mass numbers dying from asbestos and lead poisoning all from renting your units.
In haste to debate the shiny object in the room, are STRs hotels, most in this thread, except for @Steve K., has entirely glossed over the true purpose of AirBnB's suit against the city.
"The lawsuit filed Tuesday in federal court says the ordinance violates state and federal law by forcing home-sharing platforms to share information about clients with the city and requiring the platforms to enforce the new rules."
AirBnB isn't fighting being regulated. It is fighting to protect its status as an intermediary in the transaction and not get dragged into enforcing the cities regulations.
In haste to debate the shiny object in the room, are STRs hotels, most in this thread, except for @Steve K., has entirely glossed over the true purpose of AirBnB's suit against the city.
"The lawsuit filed Tuesday in federal court says the ordinance violates state and federal law by forcing home-sharing platforms to share information about clients with the city and requiring the platforms to enforce the new rules."
AirBnB isn't fighting being regulated. It is fighting to protect its status as an intermediary in the transaction and not get dragged into enforcing the cities regulations.
They are having the same fight that companies such as Napster had in the early days of music file sharing. Maybe some of you are too young to remember this. Napster "disrupted" the music industry, just like Airbnb is disrupting the Hotel industry. Napster provided a software platform for people to share music. Napster made the argument they were just a software platform and that they were not responsible for actions of the individuals using the platform. They argued it was not their role to regulate copyright infringement. They ultimately lost in court and ceased operations.
Airbnb doesn't want to be in the position of enforcing compliance of local laws for their users, but it is unavoidable. They will lose in court. Just like Wayfair recently lost their argument in supreme court about collecting taxes. Internet businesses can't hide from the law.
Property rights are not unlimited. That is firmly established in case law.
Exactly @Bill F.and @Joe Splitrock, No matter what our individual opinions are on this, or how invested we are in STR's, it's no longer debatable whether or not STR's are to be regulated like hotel businesses because all of this has been settled in court already numerous times, and AirBNB has lost nearly every case. Perhaps the most famous one was AirBNB vs. NYC starting back in 2010 and then literally dozens of other cities across the US and the world: San Fran, LA, Austin, Denver, London, Paris, Barcelona, Anaheim, Santa Monica... AirBNB has sued and lost and appealed and lost over and over. Some cities have moderate regulations, others outright bans. AirBNB has argued the rules violate their freedom of speech and that the rules are unfair and unconstitutional and they've won minor concessions at times but absolutely lost the war. In the NYC case they had laws going back to 1929's Multiple Dwelling Law that prevents nightly rentals in residential areas, and they just had to update it to include online listings, so it's not like this is a new debate. Legal precedent is well established. STR's are hotels in the eyes of the law. Personal property rights don't allow individuals to operate hotel businesses without taxation and regulation or ignore zoning restrictions. AirBNB knows this, they know Boston can regulate the crap out of STR's. AirBNB is only suing to fight back against increased severity of restrictions especially in regards to the enforcement and liability components, which could force them to alter their business model and put them in legal jeopardy. Stricter regulations are definitely the trend as more cities are emboldened by successful regulatory policies on STR's throughout the US and the world over the past 8 years.
"AirBnB isn't fighting being regulated. It is fighting to protect its status as an intermediary in the transaction and not get dragged into enforcing the cities regulations.
-------------------------------------------------
AirBnB is the one that has the information and facilitates transactions that by their very nature disrupt neighborhoods and deprive the cities of tax revenue (hotel substitution). This isn't about being an "intermediary," it is about sharing information with the government.
As for being "dragged" into enforcement, that is hardly the case. Once your place has been rented for 120 days (which AirBnB's computers can easily keep track of), your listing is killed for the rest of the calendar year. That's mostly information sharing, and if you think that is burdensome "enforcement," then I suppose you oppose dram shop laws that tell bars to stop serving obviously drunk customers.
After all, the bar is simply an intermediary between the patron and the drowning of his sorrows or sating of his alcoholism.
AirBnB also gives the city a list of who is registered with AirBnB as a host -- info sharing. The listing goes active after the city confirms to AirBnB that the host is registered with the city. Again, a fully automated process.
AirBnB deserves to lose. The transactions it facilitates impose externalities on the neighborhoods. AirBnB is the only entity with the information about those transactions. The transactions are commercial in nature. AirBnB simply wants to evade sensible regulation and to Hell with the people imposed upon.
@Charlie MacPherson The way I read that is you can rent out your primary residence, for example while you're away, but not a rental property that you don't live in. It makes sense and is perfectly reasonable. The city is trying to stop investors from essentially running unlicensed, unregulated and (most importantly to them) untaxed hotels.
You can complain that this is infringing on property rights if you want. But the government already crossed that line long ago and Americans failed to follow Thomas Jefferson's advice to overthrow it and reestablish the constitutional rights of the individual.
In haste to debate the shiny object in the room, are STRs hotels, most in this thread, except for @Steve K., has entirely glossed over the true purpose of AirBnB's suit against the city.
"The lawsuit filed Tuesday in federal court says the ordinance violates state and federal law by forcing home-sharing platforms to share information about clients with the city and requiring the platforms to enforce the new rules."
AirBnB isn't fighting being regulated. It is fighting to protect its status as an intermediary in the transaction and not get dragged into enforcing the cities regulations.
They are having the same fight that companies such as Napster had in the early days of music file sharing. Maybe some of you are too young to remember this. Napster "disrupted" the music industry, just like Airbnb is disrupting the Hotel industry. Napster provided a software platform for people to share music. Napster made the argument they were just a software platform and that they were not responsible for actions of the individuals using the platform. They argued it was not their role to regulate copyright infringement. They ultimately lost in court and ceased operations.
Airbnb doesn't want to be in the position of enforcing compliance of local laws for their users, but it is unavoidable. They will lose in court. Just like Wayfair recently lost their argument in supreme court about collecting taxes. Internet businesses can't hide from the law.
Property rights are not unlimited. That is firmly established in case law.
Ahh Napster... the memories.
The comparison between Napster and AirBnB is a bit of a stretch. I don't think AirBnb losing this specific case is a forgone conclusion.
This issue is 1. more nuanced and 2. asks the business to do a lot more than stop an already illegal action.
We live in a different day and age now with respect to people's data and who has rights to us it, particularly government enforcing a law. The city isn't saying 'hey, you guys allow this illegal activity to happen on your platform, you need to help us stop it.' They are saying "Hey, AirBnB, we have made laws about STRs. You are in the STR space, you need to integrate our regulations into your system." Two very different actions.
If Boston suspected that Joe Smith at 123 Main St had been renting out his house in violation of the statue, sure the city can get a court order for AirBnB to turn over all records relating to 123 Main St or track Joe Smith's public AirBnb profile to see his past listings and take appropriate action. This law goes further. It presuming all users of Air BnB could violate City regulations and thus preempts any potential violations through they use of a company's data.
Just as property right aren't unlimited, neither are the powers of the government.
I'm not an attorney so all of this is just the ramblings of some guy on the internet, but it seems like Boston has gone much further than other cities in terms of what they demand from a private business and the users of the business. I have no doubt this law will be in the courts for a while to come.
In haste to debate the shiny object in the room, are STRs hotels, most in this thread, except for @Steve K., has entirely glossed over the true purpose of AirBnB's suit against the city.
"The lawsuit filed Tuesday in federal court says the ordinance violates state and federal law by forcing home-sharing platforms to share information about clients with the city and requiring the platforms to enforce the new rules."
AirBnB isn't fighting being regulated. It is fighting to protect its status as an intermediary in the transaction and not get dragged into enforcing the cities regulations.
They are having the same fight that companies such as Napster had in the early days of music file sharing. Maybe some of you are too young to remember this. Napster "disrupted" the music industry, just like Airbnb is disrupting the Hotel industry. Napster provided a software platform for people to share music. Napster made the argument they were just a software platform and that they were not responsible for actions of the individuals using the platform. They argued it was not their role to regulate copyright infringement. They ultimately lost in court and ceased operations.
Airbnb doesn't want to be in the position of enforcing compliance of local laws for their users, but it is unavoidable. They will lose in court. Just like Wayfair recently lost their argument in supreme court about collecting taxes. Internet businesses can't hide from the law.
Property rights are not unlimited. That is firmly established in case law.
Ahh Napster... the memories.
The comparison between Napster and AirBnB is a bit of a stretch. I don't think AirBnb losing this specific case is a forgone conclusion.
This issue is 1. more nuanced and 2. asks the business to do a lot more than stop an already illegal action.
We live in a different day and age now with respect to people's data and who has rights to us it, particularly government enforcing a law. The city isn't saying 'hey, you guys allow this illegal activity to happen on your platform, you need to help us stop it.' They are saying "Hey, AirBnB, we have made laws about STRs. You are in the STR space, you need to integrate our regulations into your system." Two very different actions.
If Boston suspected that Joe Smith at 123 Main St had been renting out his house in violation of the statue, sure the city can get a court order for AirBnB to turn over all records relating to 123 Main St or track Joe Smith's public AirBnb profile to see his past listings and take appropriate action. This law goes further. It presuming all users of Air BnB could violate City regulations and thus preempts any potential violations through they use of a company's data.
Just as property right aren't unlimited, neither are the powers of the government.
I'm not an attorney so all of this is just the ramblings of some guy on the internet, but it seems like Boston has gone much further than other cities in terms of what they demand from a private business and the users of the business. I have no doubt this law will be in the courts for a while to come.
I drew the analogy because of the argument that Airbnb is making:
"Airbnb argues that requiring online hosts to enforce the city’s new rules violates a federal law protecting online platforms from being sued over third-party content and also that the rules infringe on Airbnb’s First Amendment right to free speech."
This law is meant to protect businesses such as review sites, social media or blogs from damages for third party content. It doesn't protect a business that is supporting illegal activity. If it did, then Napster and Backpage would still be operating. I am not saying Airbnb is the same as these businesses, but they have shown plenty of disregard for local laws over the years.
The law mandates hosts to register their STR, which seems reasonable to me. I have to add my long rental properties to a public city registry and I never once felt like it was an injustice.
I don't really care either way, but clearly this isn't just about tax money. Boston is trying to preserve their residential housing. Housing shortages are a major problem in many cities and turning all your residential property into hotels doesn't benefit the community.