AirBnB (and similar services) are a hot topic for local governments. Like other components of the sharing economy, AirBnB is disruptive to existing business models. Local governments have developed regulations and tax schemes like hotel taxes and taxi medallions which benefit them and incumbent providers (like hotel chains and cab companies) but penalize consumers. As often occurs, companies have lobbied local governments to protect their monopolistic positions. Of course, this lobbying is generally couched in the terms of public safety and welfare rather than protection of monopoly profits.
As a traveler, my experience with the sharing economy has been decidedly mixed. We have used Uber successfully to get from "Point A" to "Point B." I think Uber works because a lift (no pun intended) is rather uniform service. A great cab ride or a bad cab ride aren't terribly different, as long as you end up at your destination. Chances are that a person will forget about his or her Uber within moments of settling in at his or her destination. Overnight accommodations, however, are quite different. A bad experience years ago at a place called "Berg Tal" has become familial shorthand for a lousy accommodations.
Thus far, our experience with AirBnB has been unimpressive. In fact, I'm writing this essay from a hotel room after canceling our booking at a local AirBnB in Alaska.
The essential problem of our our AirBnB experiences has been the gap between what is portrayed on the website and what exists in reality. I'll walk through some of the issues we've encountered. Earlier this year, we booked a small home in southern Maryland. As anyone who has spent time in Maryland during the summer recognizes, air conditioning is a necessity. The small house was reasonably nice but it had one small air conditioning unit in the living room. To keep the bedroom at a decent temperature (below 80), the living room had to be kept like a meat locker. Otherwise, the small home wasn't bad and we managed to have a decent stay.
We rented another AirBnB cottage in Pennsylvania on what was accurately portrayed as a beautiful farm. What wasn't well described was the oddly configured floor plan that including a very steep and narrow staircase between the floors and the fact that amenities like the pool were shared with other rentals.
Our most recent experience in Alaska was a cabin near Fairbanks. What looked charming on the website was considerably smaller and more rustic in reality. The deal breaker for us was that the cabin had no seating save a couple of bar stools. The hotel room we're currently in has three chairs. The room we had earlier in our stay offered an actual sofa (in addition to a couple of chairs). I don't want to seem demanding, but if I'm spending three days in a room, I need something more than a barstool.
AirBnB reviews seem less accurate than hotel reviews on Trip Advisor. Maybe it's a matter of consumer expectations. Perhaps it's a function of the personal nature of AirBnB and a greater reluctance to post critical comments, or the two-way nature of the reviews. Whatever the reason, our less-than-stellar experiences have been at AirBnB properties with stellar user reviews.
While I haven't become an AirBnB fan personally, I do think its existence is an economic positive. Greater competition benefits consumers. In ensuring a free and open marketplace, the role of local government isn't to pick winners and losers (hotel chains or entrepreneurial homeowners) but to ensure a level playing field. Hotels have a valid argument in jurisdictions where they pay taxes that AirBnB owners do not. Local governments also may have legitimate public health and safety concerns like parking problems created by short-term rentals.
The bottom line is that the shared economy can benefit everyone. The role of the public administrator is to ensure that the public policy conservation is honest, beginning with the motivations of the stakeholders.
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