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Food for thought: An apartment building full of Airbnb’s isn’t an Airbnb. It’s a hotel masquerading as something else…

California knows how to party, but rising costs of living and renting in Los Angeles have forced many residents to put the fun on hold. Rents in many parts of the city have more than doubled since 2010, despite relatively stagnant wage growth. One culprit? Airbnb. The service intended to be a part of the “sharing” economy, where people make supplementary income from pre-existing resources like “an extra bedroom”, has become an industry all to its own, much like hotels – just without the rules and regulations. The Los Angeles City Council has now acted, imposing new rules from July 2019…

Disruptive VS Disruptive

Airbnb emerged as a “disruptive” technology, transforming travel experiences for the better by offering travel options more curated than a traditional hotel. Families in need of multiple rooms could find suitable accommodation without buying multiple hotel rooms and travelers willing or eager to share a space could rent a room and interact with locals. The concept is phenomenal. Demand for these budget or flex friendly alternatives has been astronomical in Los Angeles and it’s now having an adverse effect, uprooting locals. In short: landlords can make far more money renting to Airbnb guests than busy locals and rents are skyrocketing.

AirbnbLos Angeles City Council

The Los Angeles City Council has announced expansive Airbnb initiatives started in Santa Monica and West Hollywood which will bring new rules and regulations to listings across the entire city of Los Angeles. That’s a lot of ground. Beginning July 2019, the entire Airbnb game in Los Angeles is changing with new rules including…

  • 120 day limit for renting out listing, with additional time subject to proposal. 
  • Only primary residences may be listed on Airbnb. No “investment” properties. 
  • Must live in “primary residence” at least half the calendar year.
  • Rent stabilized accommodations may not be listed on Airbnb.  
  • Airbnb hosts must pay accommodation taxes, like hotels currently do. 
  • All listings must be registered with the city, and records must be kept. 
  • Standardization of safety requirements for all rental units, like smoke alarms. 

LA flight deal.If these new rules are sounding an awful lot like running a hotel, you’re not alone. Cities around the world are desperate to cash in on the sharing economy and thousands of listings not paying any tax to the city reduces the benefit of tourism initiatives. At the same time, higher taxes on Airbnb stays means more expensive Airbnb’s, which somewhat defeats the purpose for many.

The correct solution for Airbnb regulation remains a mystery, but the Los Angles initiatives seem largely in order. Entire apartment buildings becoming Airbnb listings is calling a cat a dog. An apartment building full of Airbnb’s is a hotel – not an apartment building. As such, it should be subject to the same important traveler standards and safe guards as hotels. At the same time, it’s great to see that many listings will remain in tact. Laundry, parking and kitchens save a lot of money and everyone loves to save…


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