Regulatory arbitrage of some sort seems to be involved in many recent digital business models. Whether it concerns or involves (lack of) data privacy regulation, "reinventing" labour contracts or undercutting taxation frameworks, it is a most cruel reminder of how poor the management of the commons.
While many of the efficiencies and attractions of re-inventing various businesses for the "digital age" seem genuine, their deployment within a fog of regulatory risk seems like a lose-lose proposition for anybody but the most short-term minded.
> Regulatory arbitrage of some sort seems to be involved in many recent digital business models. Whether it concerns or involves (lack of) data privacy regulation, "reinventing" labour contracts or undercutting taxation frameworks, it is a most cruel reminder of how poor the management of the commons.
Well here is the thing, in my country the majority of Airbnb rental are(at least were) illegal. Authorities knew this but hypocritically, illegal rentals were good for tourism, so the state cracked down on a few illegal rentals, for the example, while allowing 99% of them. This is regulatory arbitrage.
Uber on the other hand, didn't have the same luck since legal taxi drivers started to beat up Uber drivers so Uber quickly shut down their operation, as they were running illegal taxis and they couldn't have their cake and eat it too with the justice system... Sometimes it does backfire.
One of the reasons why all these SV tech business got away with it is the fact that they are all located in US, only the landlord or the driver are taking real risks legally. As I said before, if I tried such an operation in my own country, I'll be shut down in no time and sent straight to jail for running illegal hotels. "it's just an app" wouldn't work.
I still think that my government could have banned these apps if they really wanted to at first place, they are so eager to shutdown torrent/illegal VOD websites for instance, but they didn't.
> a lose-lose proposition for anybody but the most short-term minded.
"[I]n recent years the realisation has dawned that what’s good for Silicon Valley is not always good for everyone. What started with scrappy upstarts promising to make the world a better place has morphed into something more sinister: a pantheon of faceless multinationals who collectively dominate the world’s digital infrastructure, flouting regulations, avoiding taxes, and taking advantage of precarious labour to make a small number of people tremendously wealthy."
The prosocial case for regulatory arbitrage is that regulations can be good or bad but either way are usually sticky- so when they’re bad they’re bad for a long time. Societies, like all things, accumulate cruft over time and without arbitrage bad regulations won’t get reset until govt or economic collapse forces a major reset.
Arbitrage offers exposure to a world without some regulation and people can decide if they like that or not.
So essentially 80% were not properly registered and paying taxes? I’m not that surprised, once a good double-digit number are cheating, cheating becomes the only viable way to remain competitive.
Years ago when Airbnb was picking up steam and I was in college I got a gig building a tool to automate cross-referencing Airbnb listings with housing records so the city could request the optional tourism tax.
What we found surprised all of them. A handful of people were listing sometimes over a dozen properties and avoiding the larger, but not optional, hotel tax. The 80% figure doesn’t surprise me much now just knowing how a few individuals can flood the short-term rental market in an area.
>I’m not that surprised, once a good double-digit number are cheating, cheating becomes the only viable way to remain competitive.
Is that not always the case with these American marketplace apps? Now that the property owners have to follow the rules, they have the same burden as the real hotels, but none of the economy of scale.
Same with all the places where they make Uber drivers be actual taxi drivers in actual taxis. Then all of a sudden they are competing directly against some very large, established players who have the market pretty well figured out already.
> The number is linked to an address, which makes it possible to check whether landlords are complying with municipal regulations regarding the maximum number of rental nights allowed.
I think the problems wasn‘t that they were not paying taxes, but that they operated private apartments as hotels without permission.
There's a limit of 30 nights per year that private individuals can let out their homes. Before the mandatory registration, there was no way for the municipality to enforce or even check that people complied. Now that people can't let out their properties all year round it's not worth it so they're selling up or getting in long term renters.
Whole buildings were purposefully converted to illegal hotels. It's been a factor in rising property prices and housing shortages. Less tourism is one of the unexpected bonuses of COVID-19.
Nice twist. A country that is a tax heaven and enables a lot of business to avoid due taxes in other jurisdictions is now concerned that it can't get its own share of taxes.
> once a good double-digit number are cheating, cheating becomes the only viable way
Good point, but how little oversight does this country have of money being sent to peoples accounts from Airbnb etc? In my country (Norway), all transactions > 500 USD, (or multiple transactions from the same sender of lesser amounts), would register with the tax office. The receiver would have to disclose the source of these transactions to the tax office.
If money coming in or out of peoples accounts are governed by self-reporting, people must pay highly inaccurate taxes in the Netherlands.
There is not a big tourist tax here; the biggest tax evasions for private people is probably on their income tax level, but that's not solved by this.
The direct issue it addresses is the take over of many tourists of certain neighborhoods meant for living.
The favorite hobby of habitants of Amsterdam is complaining about tourists.
The fight against Airbnb is a symbolic fight for the left winged parties in the city. Airbnb stands for big bad capitalistic wolf that makes the city unlivable for the normal people.
The issue this bigger fight addresses is that Amsterdam is slowly becoming unaffordable for normal people and especially families. Tourist rentals are partly to blame, but there are many more causes (low interest rate, rich parents, students, limited space and more)
So there are a bunch of restrictive legislations trying to deal with this, this is just one of them. Another one for instance is that since last year it's required to have a permit if you want to live in a house with more then 2 adults.
Already for years it was required to register every night you rented out your appartment. Airbnb however refused to open the books so there was no way to check it for the city. Probably this way Amsterdam can check every registered appartment that's publically listed without the help of Airbnb.
I'm a power user of Airbnb. I have never disliked a service as much that I pay continue to pay for other than LinkedIn. Both of these are because I have/had little choice. What it all comes down to is getting a shitting experience and paying a premium for it.
I have a 30+ day stay that had been booked close to 6 months in advanced canceled 7 days before my stay because the user sold their house. Airbnb said they would help me find a new comparable place. What they meant was they would send me a $200 gift card and say tough shit that all the comparable houses are booked already.
I hope they get regulated hard. Maybe someday they will start giving a shit about their users too.
What? Kind of a illogical reaction to a tough situation right? What is AirBnb supposed to do if one of their hosts sells their house without notifying them and all similar listing are already booked? Would more compensation satisfy you? Honestly confused why you would want to punish a service you admit to using frequently.
Looking for long term stays on airbnb is an absolute minefield.
Yeah the owner should be forced to pay to put you up in a hotel of your choice if they optionally choose to cancel on short notice.
> I'm a power user of Airbnb. I have never disliked a service as much that I pay continue to pay for other than LinkedIn
As someone who has more or less been living out of Airbnbs for 5 years as as digital nomad I couldn't agree more. There is however a secret code language for talking to there support where you can generally get them to treat you fairly by being very selective in the language you use to describe situations to make sure you never fall outside the boundries of their insane policies.
It was really weird walking in Amsterdam during summer this time around. Generally for past few year, I had seen explosions of tourists doing a weekend tours. There used to be barely any foot space to walk near dam square and shopping streets. This time I just was able to be make an appoint for Anne Frank museum a day before and simply walk in without a queue. This is the conundrum of tourism. If you too much tourist in the city then if feels like a Disney land, if there too little then there is no business. I wouldn't just blame Airbnb for the tourist explosion but in general there are lot of cheaper hotels, hostels which attract not so nice tourists. This summer was great for me but not that good for the local businesses. Balancing this ecosystem is I think pretty hard. One of the things i was thinking how you could solve would be purpose make navigating throughout the city difficult. That forces people to stay longer, therefore limits people who come for short haul.
It expands on the various forms of advertising (eg, Expedia, TripAdvisor) and goes on to state that these sites are the majority places of advertising one’s airbnb.
Lot's of experiences are amazing and wonderful when very few people do it, but they morph into something different when the masses come in. National parks. A rustic cafe in an old town. A picknick along a river bank. High signal internet forums. Venice. Zhangjiajie. Driving cars.
I don't know if any solution exists. It seems to me that the only way to preserve the original experience is via some sort of exclusiveness, which immediately provokes a backlash. Especially exclusions based on money.
Yeah, but from the perspective of people actually trying to live in these places it's a cancer on the city.
I personally know several people previously living in Amsterdam that left the city or parts of it simply because their day-to-day lives were getting disrupted by tourists taking over residential neighborhoods. They create a lot of noise, get drunk and high, vomit in the porches, leave trash everywhere etc.
A city should be for people that live there, not a theme park for those looking for a rush.
What I really liked in the early days is that there was more interaction with the host, because you often rented a room in their place or a part of the appartment, while they were still living there. Lot's of interesting conversation. Nowadays it's just business for a lot of hosts, they don't even bother welcoming you and put the key in a keysafe.
Amsterdam is trying hard to fight against tourism. They even plan to move the red light district and possibly demand dutch ID in coffeeshops. Nice to see that. 20M tourists per year for 1.2M city is too much.
Airbnb is great when traveling, but it made things more difficult for renters in cities with even a slightly moderate amount of tourism. Better houses with amenities like pools are almost completely out of the long-term rental market, or have insane prices.
For the professional urban renter this just means a less fancy rental, but this less fancy rental now is out of the reach for lower income people.
Someone needs to remove 80% of advertisements from "ruetir.com". Personally I don't mind a reasonable level of advertising on the web, but that site has gone way overboard. Looks like some kind of spam/scam site.
Booking.com is where the most desperate landlords and the real scumbags post. It's a cesspool. No wonder it's the only one where number of listings has increased given the circumstances.
These companies are going to screw themselves by not policing the behavior of landlords. The government will do it for them, as evidenced by this move. I know VRBO does nothing to protect renters (unless they get raped/assaulted and need to head off bad PR). There needs to be transparency about who owns and is ultimately responsible for the property. VRBO currently insulates owners/operators from accountability to renters. I got ripped off for $2100 and had no recourse from VRBO. No way to file a complaint and it was clear once I went looking for support that it was 100% focused on helping owners/operators use their platform.
The current requirement to assure that a renter doesn't get ripped off is to use a credit card that will refund their money in the event the owner tries to rip them off. Good luck to the un-banked and working poor.
I've often thought that municipal regulations would be the best way to get rid of unsavory American corporations.
Another one that I'm not surprised has happened yet is a ~$5,000 dollar per day fine for an unattended cash register. That would get rid of CVS and Walgreens overnight.
I’m sure i’m being dense here, but can you please explain the justification for fining a retailer for an unattended cash register? Also what’s unsavory about CVS/Walgreens?
It's really sad how throughout the western world governments have come to rely on big tech monopolies to act as their enforcers instead of just enforcing the law using the normal machinery of the state.
Once the state becomes addicted to enforcement via big tech, it becomes reluctant to break up those big tech companies and promote competition.
I'd be surprised if a large % of those that no longer rent out on Airbnb can just leave their properties empty. I wonder whether those properties have shifted to other short-term rental platforms or whether they've gone back into long-term renting and what impact that the latter (would) have on the local rental market...
The 20% yoy housing price increases in NL have made it more than profitable to leave properties dormant. This is another factor in the housing crisis here, savings are taxed so wealthy individuals are all investing in property.
You see a lot of millenials in particular complain about how they're basically screwed, financially. Houses are unaffordable, they have a mountain of debt, etc. Probably the only reason you don't hear this so much from Gen-Z yet is they're either too young or just in shock and denial about their position.
I'm truly sympathetic. I compare how I could live post-university and it's just not achievable now.
Here's the rub: if you support the view that housing is too expensive and people can't find places to live then you should be absolutely against AirBnB. At least, AirBnB of whole units. I'm completely fine with someone renting out rooms in their house or an additional unit on their property.
It is undeniable that AirBnB makes houses more expensive and reduces supply to buyers and renters.
Cities should be first and foremost for the people who live in them. AirBnB facilitates running illegal hotels. I'm also against people using residential property to park their money. We given real estate exemptions from reporting requirements that no other asset class has.
Landlords need to exist otherwise who will provide rental stock. Those landlords should be residents of those cities and not some faceless hedge fund.
[+] [-] streamofdigits|4 years ago|reply
While many of the efficiencies and attractions of re-inventing various businesses for the "digital age" seem genuine, their deployment within a fog of regulatory risk seems like a lose-lose proposition for anybody but the most short-term minded.
[+] [-] throw_m239339|4 years ago|reply
Well here is the thing, in my country the majority of Airbnb rental are(at least were) illegal. Authorities knew this but hypocritically, illegal rentals were good for tourism, so the state cracked down on a few illegal rentals, for the example, while allowing 99% of them. This is regulatory arbitrage.
Uber on the other hand, didn't have the same luck since legal taxi drivers started to beat up Uber drivers so Uber quickly shut down their operation, as they were running illegal taxis and they couldn't have their cake and eat it too with the justice system... Sometimes it does backfire.
One of the reasons why all these SV tech business got away with it is the fact that they are all located in US, only the landlord or the driver are taking real risks legally. As I said before, if I tried such an operation in my own country, I'll be shut down in no time and sent straight to jail for running illegal hotels. "it's just an app" wouldn't work.
I still think that my government could have banned these apps if they really wanted to at first place, they are so eager to shutdown torrent/illegal VOD websites for instance, but they didn't.
[+] [-] beckman466|4 years ago|reply
"[I]n recent years the realisation has dawned that what’s good for Silicon Valley is not always good for everyone. What started with scrappy upstarts promising to make the world a better place has morphed into something more sinister: a pantheon of faceless multinationals who collectively dominate the world’s digital infrastructure, flouting regulations, avoiding taxes, and taking advantage of precarious labour to make a small number of people tremendously wealthy."
https://tribunemag.co.uk/2019/01/abolish-silicon-valley
[+] [-] AbrahamParangi|4 years ago|reply
Arbitrage offers exposure to a world without some regulation and people can decide if they like that or not.
[+] [-] cblconfederate|4 years ago|reply
[+] [-] olalonde|4 years ago|reply
[+] [-] nikanj|4 years ago|reply
[+] [-] scrose|4 years ago|reply
What we found surprised all of them. A handful of people were listing sometimes over a dozen properties and avoiding the larger, but not optional, hotel tax. The 80% figure doesn’t surprise me much now just knowing how a few individuals can flood the short-term rental market in an area.
[+] [-] Tabular-Iceberg|4 years ago|reply
Is that not always the case with these American marketplace apps? Now that the property owners have to follow the rules, they have the same burden as the real hotels, but none of the economy of scale.
Same with all the places where they make Uber drivers be actual taxi drivers in actual taxis. Then all of a sudden they are competing directly against some very large, established players who have the market pretty well figured out already.
[+] [-] Hendrikto|4 years ago|reply
I think the problems wasn‘t that they were not paying taxes, but that they operated private apartments as hotels without permission.
[+] [-] obrienk|4 years ago|reply
[+] [-] jacquesm|4 years ago|reply
[+] [-] saddlerustle|4 years ago|reply
[+] [-] tut-urut-utut|4 years ago|reply
[+] [-] the-dude|4 years ago|reply
[+] [-] bjarneh|4 years ago|reply
Good point, but how little oversight does this country have of money being sent to peoples accounts from Airbnb etc? In my country (Norway), all transactions > 500 USD, (or multiple transactions from the same sender of lesser amounts), would register with the tax office. The receiver would have to disclose the source of these transactions to the tax office.
If money coming in or out of peoples accounts are governed by self-reporting, people must pay highly inaccurate taxes in the Netherlands.
[+] [-] toshk|4 years ago|reply
There is not a big tourist tax here; the biggest tax evasions for private people is probably on their income tax level, but that's not solved by this.
The direct issue it addresses is the take over of many tourists of certain neighborhoods meant for living.
The favorite hobby of habitants of Amsterdam is complaining about tourists.
The fight against Airbnb is a symbolic fight for the left winged parties in the city. Airbnb stands for big bad capitalistic wolf that makes the city unlivable for the normal people.
The issue this bigger fight addresses is that Amsterdam is slowly becoming unaffordable for normal people and especially families. Tourist rentals are partly to blame, but there are many more causes (low interest rate, rich parents, students, limited space and more)
So there are a bunch of restrictive legislations trying to deal with this, this is just one of them. Another one for instance is that since last year it's required to have a permit if you want to live in a house with more then 2 adults.
Already for years it was required to register every night you rented out your appartment. Airbnb however refused to open the books so there was no way to check it for the city. Probably this way Amsterdam can check every registered appartment that's publically listed without the help of Airbnb.
[+] [-] bennysomething|4 years ago|reply
[+] [-] AlwaysRock|4 years ago|reply
I have a 30+ day stay that had been booked close to 6 months in advanced canceled 7 days before my stay because the user sold their house. Airbnb said they would help me find a new comparable place. What they meant was they would send me a $200 gift card and say tough shit that all the comparable houses are booked already.
I hope they get regulated hard. Maybe someday they will start giving a shit about their users too.
[+] [-] dcgudeman|4 years ago|reply
[+] [-] anm89|4 years ago|reply
Yeah the owner should be forced to pay to put you up in a hotel of your choice if they optionally choose to cancel on short notice.
> I'm a power user of Airbnb. I have never disliked a service as much that I pay continue to pay for other than LinkedIn
As someone who has more or less been living out of Airbnbs for 5 years as as digital nomad I couldn't agree more. There is however a secret code language for talking to there support where you can generally get them to treat you fairly by being very selective in the language you use to describe situations to make sure you never fall outside the boundries of their insane policies.
[+] [-] debarshri|4 years ago|reply
[+] [-] airza|4 years ago|reply
[+] [-] arkades|4 years ago|reply
[+] [-] hdjjhhvvhga|4 years ago|reply
[+] [-] srmarm|4 years ago|reply
[+] [-] em500|4 years ago|reply
I don't know if any solution exists. It seems to me that the only way to preserve the original experience is via some sort of exclusiveness, which immediately provokes a backlash. Especially exclusions based on money.
[+] [-] jonkoops|4 years ago|reply
I personally know several people previously living in Amsterdam that left the city or parts of it simply because their day-to-day lives were getting disrupted by tourists taking over residential neighborhoods. They create a lot of noise, get drunk and high, vomit in the porches, leave trash everywhere etc.
A city should be for people that live there, not a theme park for those looking for a rush.
[+] [-] A_Venom_Roll|4 years ago|reply
[+] [-] qwerty456127|4 years ago|reply
[+] [-] Loughla|4 years ago|reply
Now I am 100% out of the sphere of technology, but isn't skirting regulation to make money exactly how AirBnB got started?
[+] [-] sAbakumoff|4 years ago|reply
[+] [-] vadfa|4 years ago|reply
[+] [-] elzbardico|4 years ago|reply
[+] [-] difosfor|4 years ago|reply
[+] [-] jikbd|4 years ago|reply
[+] [-] Reason077|4 years ago|reply
[+] [-] btbuildem|4 years ago|reply
[+] [-] unknown|4 years ago|reply
[deleted]
[+] [-] datavirtue|4 years ago|reply
The current requirement to assure that a renter doesn't get ripped off is to use a credit card that will refund their money in the event the owner tries to rip them off. Good luck to the un-banked and working poor.
[+] [-] RNCTX|4 years ago|reply
Another one that I'm not surprised has happened yet is a ~$5,000 dollar per day fine for an unattended cash register. That would get rid of CVS and Walgreens overnight.
[+] [-] dickfickling|4 years ago|reply
[+] [-] saddlerustle|4 years ago|reply
[+] [-] andybak|4 years ago|reply
[+] [-] Oarch|4 years ago|reply
[+] [-] quotemstr|4 years ago|reply
Once the state becomes addicted to enforcement via big tech, it becomes reluctant to break up those big tech companies and promote competition.
[+] [-] mxstbr|4 years ago|reply
[+] [-] jacquesm|4 years ago|reply
[+] [-] cletus|4 years ago|reply
I'm truly sympathetic. I compare how I could live post-university and it's just not achievable now.
Here's the rub: if you support the view that housing is too expensive and people can't find places to live then you should be absolutely against AirBnB. At least, AirBnB of whole units. I'm completely fine with someone renting out rooms in their house or an additional unit on their property.
It is undeniable that AirBnB makes houses more expensive and reduces supply to buyers and renters.
Cities should be first and foremost for the people who live in them. AirBnB facilitates running illegal hotels. I'm also against people using residential property to park their money. We given real estate exemptions from reporting requirements that no other asset class has.
Landlords need to exist otherwise who will provide rental stock. Those landlords should be residents of those cities and not some faceless hedge fund.