Airbnb unwise to pump up pressure
Opinion: Not so long ago I was lucky enough to do a road trip through Texas.
Texas is as good as it gets if roadside Americana is your bag. My trip included the rattlesnake round-up in Snyder, the Buddy Holly memorial in Lubbock and, of course, the Cadillac Ranch.
Created by an oil millionaire in 1974, the Cadillac Ranch is a public art sculpture in the middle of a corn field. It consists of 12 finned Cadillacs ranging from 1949 to 1963, half-buried nose-first in the ground, at the same angle as Egypt’s Great Pyramid.
While Texas is long on roadside attractions, it’s short on corners. So it’s easy to speed.
The Highway Patrol officer who pulled over my rental Dodge Challenger was a charming ambassador for the state of Texas. After showing surprising understanding of where New Zealand was and that we were pretty handy at rugby, the officer chose not to ticket me for doing 79mph (127kmh).
Instead he gave me a brochure and a sticker that looked like a highway speed sign with the words ‘‘70 – it’s not just a good idea, it’s the law’’.
I was still thinking about it when I heard about the travails that another American invention – Airbnb – is causing in New Zealand.
Back in 2007 San Francisco flatmates Brian Chesky and Joe Gebbia came up with the idea of putting air mattresses in their living room and turning it into a bed and breakfast. Ten years later Airbnb has become the largest accommodation business in the world.
Here in godzone, it’s taken off like a robber’s dog. There are more than 27,000 local properties on the site, far outstripping local players www.holidayhouses.co.nz and www.bookabach.co.nz. The Airbnb offerings range from foldout sofas in Ponsonby to palatial lakeside properties in Taupo and Queenstown.
And it’s Queenstown that is the site of the current conflict. The locals say Airbnb is ruining the town for everyone – tourists and locals alike.
According to a study by Infometrics, one in 10 dwellings in the Queenstown Lakes District is listed on Airbnb; that’s 2000 dwellings.
Other estimates put it closer to 2700, creating problems aplenty for the picturesque locale.
The most obvious is the impact it’s had on house prices, removing a large slice of supply to create a demand-fuelled surge in prices.
But it’s not just a home affordability problem, it’s a worker accommodation problem as hundreds of local businesses can’t hire staff because they have nowhere to live.
Plus there’s a growing belief that the area has lost its sense of community because so many properties are dominated by shortterm renters.
There’s also allegations about a lack of a level playing field, whereby absentee property owners don’t contribute to the tourism overheads. Currently only those registered as commercial businesses pay the rates-based levy.
Last week the Queenstown Lakes District Council tabled a proposal to restrict short-term rentals of houses in low and medium-density residential zones to 28 days a year.
Non-resident owners would be limited to a maximum of three short-term commercial stays before they were required to register as commercial operators and get resource consent.
Airbnb has gone a bit thermonuclear in its response, calling in its Australasian head of spin doctoring.
He’s taken some pretty aggressive tilts towards the Queenstown council, and identified the ‘‘nanny state’’ attitude as the problem.
This despite the fact Airbnb have met the community halfway in countries like France, meeting government requests to limit the number of rentable nights in a year.
I reckon poking the borax at the Government here in godzone is a risky position for Airbnb.
While it’s true that the Government can fail to keep up with the speed of technological innovation, that’s not to say that they are a bunch of mugs who can ignore balancing community interest with commercial drivers.
As long as you enjoy commercial revenue in a community you have compliance obligations, including those relating to tax, health and safety.
I’d be willing to bet a cold beer on a hot day that there may not be full tax compliance by all the Airbnb operators in New Zealand, or even just in Queenstown.
So a targeted Inland Revenue audit could make things a bit awkward for Airbnb.
Likewise, all those property owners will employ locals who clean and service those properties.
Under the Health and Safety at Work Regulations those property owners have widespread duties and obligations relating to those locals. Again, I’m not sure they all would chin the bar of compliance, due diligence and record-keeping.
And the recent Airbnb fire in Christchurch which put six people into hospital also raises questions about the provisioning of fire alarms and fire exits.
Which takes me back to my Texas Highway Patrol experience.
Paying your share for infrastructure, and making sure people are safe are not just good ideas; they’re also the law.
And Airbnb may not want to push too hard on this one.
The locals say Airbnb is ruining the town for everyone.
❚ Mike ‘‘MOD’’ O’Donnell is an e-commerce manager and professional director. His Twitter handle is @modsta and he’d love to be a shareholder in Airbnb.