Berlin authorities crack down on Airbnb

Hopefully those rents go back down to their previous levels. I boycott Airbnb, totally avoid them.

Same thing is happening here in my home of Seattle - there are entire apartment complexes that appears to all be airbnb hotels.

We need a little of that Zweckentfremdungsverbot here (gee, I wish we named our laws like that...).

That's a good example of a compound noun...das Zweckentfremdungsverbot

Bravo for the crackdown!

The law will impose a "hefty fine" which is like another luxury tax aimed to penalize. Pay the "hefty fine", make the loss up by Airbnb money based on supply and demand.

All I know is Airbnb won't ever get my money earmarked for accommodations, and since I have to spend anyway, that money I am giving only to Pensionen and small hotels anywhere in Germany, especially in Berlin.

This is old news, as this law was introduced last year, but takes effect from today in Berlin. I stayed in Berlin last November and it was being discussed then.

The trouble with Airbnb (apart from the fact that their fees are hefty and you have to pay 100% up front even if not travelling for say 9 months), is that you can't tell who is being honest and paying their taxes on this income and who is just pocketing the cash. There isn't a problem if people declare the income. In many places, Airbnb is now the default website for those seeking accommodation that isn't a bland international hotel chain.

The tax authorities in many countries are trawling websites such as Airbnb and Homeaway to clamp down on tax evasion.

AirBnb doesn’t rent apartments. AirBnb doesn’t own apartments. AirBnb is a listing services for individuals and companies that rent apartments. If you have ever rented an apartment in Europe, even if you rented it directly from the owner or through another listing service, odds are it was also listed on AirBnb; so AirBnb is tough to avoid.

The risks of renting an apartment are in my mind pretty real. You aren’t always dealing with a professional businessman and you aren’t always dealing with an individual who has a lot to lose if he doesn’t live up to his end of the bargain. I feel more comfortable searching out apartments that are professionally managed by a larger entity that does have a lot to lose if they get a bad reputation. But even the larger entity will market through AirBnb among other listing agencies. I know of apartments that are in AirBnb and at least 4 other listing agencies.

If you rent at a Pension you are most often renting from an individual who has a large home, or similar, that he uses for income. Or at least that was the old non-commercial version of it. If you rent an apartment you are renting from an individual who has a small home, or similar, that he uses for income. I don’t see a whole lot of distinction.

I don’t live or vote in Germany so I am not going to be critical of their law. I don’t know the circumstances. In general, banning Vacation Rentals or short term rentals in an effort to lower rental rates is just another form of rent control. Rent control is a process by where the government decides that your personal property is too valuable for the common good and to correct that error takes from you a portion of that value. In the private sector this is called theft.

I do fully support Deed Restrictions and Condo Owners Associations that want to limit the use of properties within their jurisdiction. That’s grass roots Democracy at its best.

There are areas in some cities where if it were not for the short term rentals the buildings would have crumbled to the ground. The rentals have brought about a rebirth to many neighborhoods. Of course, the tenants living in the crumbling ruined $100 a month apartments have been displaced; but the businesses in these areas have flourished meaning the workers can afford better living. The situation brings good for some, bad for others. The dynamics are so complex that when the government gets involved in all but the most horrific situations all they do is make matters worse for everyone affected.

IF, an apartment owner finds himself in a situation where short term rentals are more profitable than long term rentals then he is very fortunate indeed. With short term rentals repairs are done more often, utilities must always be paid by the owner, cleaning crews have to come twice a week, you have to purchase and replace linens, you have to figure the value of your time to meet, greet, collect, advertise, business taxes, etc; all based on an occupancy rate of what, 40%? So even if you charged twice as much per day on a short term rental vs a long term rental the odds of you making more money in the short term are not very good except in some very unique circumstances. A lot of those that do the short term rentals are doing them for reasons more complex than immediate economic gain. Generally speaking I think it’s a trend thing that will correct itself if left alone.

According to recent news reports, they're also dealing with this problem in the City of Vancouver. The number of Airbnb (and similar) rentals has increased to the point where long term rentals are being squeezed out, in an area where rental housing has been expensive and hard-to-find at the best of times. I'll be interested to see what kind of solution they come up with.

Ken, when that sort of thing happened here the solution turned out to be that some people had to move out while those that could afford the higher prices moved in. That trend continued until the supply and demand leveled off and fair market values became apparent. The increased tax revenue in the now higher value neighborhood was used, in part, to improve infrastructure in the remaining lower value neighborhoods.

There needs to be a solution, because clamping down airtight on AirBnb isn't a good thing either. Hotels have had a monopoly on accommodations for hundreds of years. They charged whatever they felt like and nickeled-and-dimed tourists for years and years and we were none-the-wiser. If you want to bring revenue to your city, getting tourist dollars is an absolute must, and it isn't going to happen with hotels alone.

I will continue to use AirBnb until I can't use it anymore, and I would be happy to pay any additional tax to ensure I still can.

At issue of course is that a company without any skin in the game can pretty much radically alter the rental landscape of cities with strong tourist appeal. There are lots of "regular folks" who get pushed out in the process. I like Air B&B too, though as Emily points out there needs to be a balance struck. A free market is all well and good but people are reeling at the increase in rents for year round citizens in Paris, Barcelona, Berlin, etc, etc, and at some point there does need to be some governmental intervention. It doesn't all just tie up neatly with a bow with the it's a free market argument, and is not healthy for established communities.

James E.,

That's only part of the problem in the Vancouver area, as the housing situation there has gone crazy with speculation and something called "shadow flipping", and that rubbish is driving prices up to astronomical levels. A lot of that is apparently driven by offshore investors who have deep pockets. For example, there have been several high profile examples recently of dilapidated 1930's vintage houses selling for about $7 million, and in some cases hundreds of thousands of dollars OVER asking price! This is another situation that politicians at several levels of government are wrestling with, and the Airbnb situation is only one part of the overall problem.

Emily,

"They charged whatever they felt like and nickeled-and-dimed tourists for years"

That situation seems to be getting worse, with hotels in some areas now charging "resort" fees to cover things which used to be included in the cost of the room. I considered going to Vegas for a few days last winter, but after I learned about the extra fees of about $35 per night (which at that time would have been Cdn$50/night), I scratched Vegas off the list permanently. Maybe I'll try Cuba instead.

Kaeleku,

I wasn't aware of the situation occurring in the other cities, but we're constantly bombarded by news stories concerning the situation in Vancouver. In this case, it seems to be mostly capital migrating out of the far east and looking for a place to roost. It's interesting that you mention the occupancy of about 10%, as the City of Vancouver conducted a study using electricity consumption, and also found that many of the pricey dwellings were not occupied.

Ken, I do agree that business must be transparent. That one act ensuring transparency generally keeps the actions above board. Beyond that I have little confidence that governments will do anything other than make a bad situation even wose, despite all the good intentions.

I am not certain if the Bulgarians who have work and decent wages for the first time in many years really detest the partially empty Russian owned condos on their coast. But i know that I resent the eyesores.

There have long been hotel alternatives in many areas- Air BnB is nowhere a new idea, they just get all the press. I live in an area where about 90% of the short term rental options are vacation condos rather than hotels rooms, and it's been that way since the early 80s- owners have long either paid a professional management company a fee to connect them with renters and handle cleaning or else they're advertised on their own through outlets like VRBO.

When we moved to Florida in the 90s, we spent a few years living a block from the beach and unfortunately next door to a complex that did short term rentals to ill-behaved drunken holiday-goers. I so do not miss their 2:00am loud pool parties when I had to get up at 6:00am for work. (We thought of moving after the first year, but rent was cheap and it was letting us save up for a down payment on a house in a suburb that strictly banned short term rentals in about 98% of the housing units in town.)

I have never used Airbnb, but this appears to be big brother at work.