Home-sharing legal gray-area could close with Airbnb regulation

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By Beige Luciano-Adams
Hub Correspondent 

The divisive battle over Airbnb in Los Angeles – a jagged splinter in the broader housing crisis debate – continues to rattle on as officials weigh competing data and cautiously approach a final regulatory framework. 

Last month, at the city’s Planning, Land Use and Management Committee, Chair Jose Huizar said the goal was to “enact a policy where we don’t punish current hosts who are good operators,” while strengthening enforcement against those who would abuse the practice. 

Airbnb proponents tout benefits for hosts who use the platform to make ends meet, and substantial economic boosts for the city. Critics, meanwhile, fear the regulatory process could be compromised by the fact that Los Angeles is already enjoying a 14% tax from Airbnb.  

The City’s draft ordinance requires hosts live at the property at least half the year and caps the number of rental days at 180, with heavy fines for non-compliance. Most critics would like to see that cap scaled way back. 

But the decision to regulate these properties is moving at a glacial pace.  

“I’m concerned that the Council has been drawn into a prolonged stall mode by the industry powers like AirBnB so that it becomes more difficult for us to get a handle on the situation with each passing day,” Councilmember Paul Koretz told The Hub in a statement. 

Murray Cox, the New-York-based data consultant behind many Airbnb battles, suggests the City is trying too hard to please everyone – and should instead look to other cities that have enacted more restrictive laws, including forced data sharing when hosts don’t comply. 

“Without the foundation of accountability and some type of data sharing it might as well be unregulated,” Cox said.  

For Koretz, among councilmembers against permitting vacation (vs. primary home) rentals, the line between keeping homesharing profitable for “mom-and-pops” while dis-incentivizing commercial activity is about 90 days – “with a primary residence I don’t think you need a cap,” he said at the hearing. 

Airbnb reports about 84% of its hosts are primary residents. 

“The hundreds of hosts who attended last week’s hearing are a testament to the benefits that Airbnb provides to regular Angelenos,” the company’s Public Policy Manager, John Choi, wrote in a statement to The Hub.  

Referencing a new Los Angeles Economic Development Corporation report commissioned by Airbnb, he added, “Homesharing puts thousands of dollars in the pockets of LA residents and contributes over a billion dollars to LA’s economy.” 

LAEDC estimates Airbnb host revenue and local visitor spending adds up to nearly $1 billion each year, 7,440 jobs, and almost $40 million in transit occupancy taxes (less when accounting for crossover with local hotel market). 

Losses from a 180-day cap would be $213.3 million, 1,780 jobs, and $8.6 million in taxes, while a 60-day cap would reduce economic impact by $530 million, 4,370 jobs, and $22.6 million in taxes, according to LAEDC. 

Koretz, who claims his district has the most short-term rental nuisance complaints, if not the most short-term rentals, urged expediency. 

“I continue to believe we’ll do just fine on tax revenues but have more ability to enforce against the hosts and platforms who are making a mockery of our existing laws, adding to our housing shortage and disrupting neighborhoods and creating nuisance left and right. This is why we need to get a focused, enforceable ordinance on the books as soon as possible.” 

(Disclosure: This reporter has used Airbnb in the past, as both host and guest) 

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