{"id":1158,"date":"2020-12-30T06:00:09","date_gmt":"2020-12-30T11:00:09","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=1158"},"modified":"2024-04-25T23:20:05","modified_gmt":"2024-04-26T03:20:05","slug":"airbnb-why-its-hot-how-it-works","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/airbnb-why-its-hot-how-it-works\/","title":{"rendered":"Airbnb: Why It\u2019s Hot, How It Works"},"content":{"rendered":"\n
\"Image<\/figure><\/div>\n\n\n\n

The enduring appeal of the family-run bed-and-breakfast has\nmet technology. With an app from Airbnb (from “air mattress B&B”),\nor the somewhat similar VRBO (\u201cvacation rental by owner\u201d), homeowners can make\nmoney from their extra rooms or even their entire houses. More than 5 million\nlistings appear today on Airbnb’s website, in more than 100,000 cities all over\nthe world. <\/p>\n\n\n\n

Using Airbnb\u2019s online platform, tourists can find and chat\nwith local hosts who offer guests a local\u2019s view of the place they visit. Many\nlistings target no-frills tourists seeking good deals on lodging. Specially\nvetted Airbnb Plus listings attract customers looking for a more luxurious\ntouch.<\/p>\n\n\n\n\n\n\n\n

The concept has worked. By focusing on the nexus of \u201capp culture\u201d and the “share economy,”\u00a0Airbnb has found financial success. The company made its most recent splash by doubling its market value, weighing in at more than $100 billion in 2020\u2019s biggest U.S. initial public offering.<\/a><\/p>\n\n\n\n

Airbnb as a Platform, and a Social Influencer<\/h2>\n\n\n\n

Airbnb is a platform, to which homeowners submit identification,\ncreate personal profiles with vetted contact information, describe and register\ntheir available spaces on the platform, and set their prices per length of stay.\nFor people who decide to do this as a regular income source, there are meetups\nwhere the experienced hosts coach the newbies.<\/p>\n\n\n\n

Before choosing accommodations, tourists create user\nprofiles as well. When making their reservations, they\u2019ll review the Airbnb\ncommission, taxes, and fees for homeowner and guest support. Airbnb\nhandles the financial transaction. Both the homeowner and the guest can write\npublic reviews of their experiences. <\/p>\n\n\n\n

There are getaway homes, shared lodging, long-term stay\ndiscounts, and even hotel rooms with instant booking options. People can also buy\nevent tickets through the site. The site\u2019s most active owners receive the\nperk of high visibility. This is a benefit for guests and owners alike, because\nit allows owners more leeway in selecting the guests who will be a good fit for\nthe noise level, the amenities, and so forth. <\/p>\n\n\n\n

Can that ability to select guests turn into bias? It can, so Airbnb has made a commitment to detect and address private bias and racial discrimination, beginning by collecting data for a U.S. initiative called Project Lighthouse<\/a>. The company has published information on its methodology to help other peer-to-peer transaction facilitators find and address discrimination. The company also has a straightforward plan to ensure inclusivity<\/a> in its ranks. \u00a0<\/p>\n\n\n\n

Regulating House-Sharing in the Age of Airbnb<\/h2>\n\n\n\n

Thinking of having your home earn money with the help of a home-sharing platform? First, you\u2019ll want to check your local rules. Some municipal zoning\u00a0or administrative codes curtail homeowners\u2019 options to open their houses to short-term, paying guests. Other local governments require owners to apply for special permits, or to be locally licensed<\/a>, before sharing their homes or condos with paying guests. <\/p>\n\n\n\n

Some of these rules are meant to protect landlords from renters who sublet their homes through Airbnb\u00a0without the property owner\u2019s permission. Others respond to complaints about the impact of tourists on the area\u2019s character, or to objections made by hotel companies<\/a>. Airbnb\u2019s city regulations help page<\/a> underscores the corporation\u2019s interest in persuading local officials to regard the home-sharing platform as a benefit to cities and their residents.\u00a0 <\/p>\n\n\n\n

The site advises condo and co-op owners<\/a> to consult their property\u2019s regulations to know if they bar sublets or include hosting restrictions. Renters and landlords are advised to check their leases; Airbnb further suggests adding riders to lease agreements to spell out space-sharing terms and conditions. <\/p>\n\n\n\n

By now, you can see there are many reasons to consult with\ntax and law experts before jumping onto the platform. For example, you\u2019ll need\nto know what your state\u2019s Department of Revenue charges in hotel occupancy taxes<\/a>. Yes, these will affect you.\nMany counties, too, collect hotel taxes, and your house may need to be\nregistered in the county. Contact your county treasurer\u2019s office to find out.<\/p>\n\n\n\n

Condo Owners: Check Your Restrictive Covenants<\/h2>\n\n\n\n

Speaking of condos and co-ops, owners of these units need to\nlook at their association\u2019s rules for any language that could rule out\nshort-term subletting. Often, violations of these rules incur lienable fines. That\nis, where allowed by law, a financial penalty placed against a unit must be\npaid, or a cloud on the unit owner\u2019s title could result. Liens\non a title<\/a> obstruct the owner\u2019s selling or refinancing options. In\nextreme cases, they become justifications for foreclosure actions to collect outstanding\ndebts.<\/p>\n\n\n\n

So, if a there is a homeowners\u2019 association and the HOA\u2019s\nCovenants, Conditions, and Restrictions (CC&Rs) apply to the unit, pay heed. If\nyou are thinking of buying an investment property or renting part of it to\nothers for any length of time, understand the restrictive covenants first. Additionally,\na call to the management office can provide a quick idea of the property\u2019s\nperspective on using home-sharing apps. Where rules are ambiguous, the attitude\nof the board and management will be key.<\/p>\n\n\n\n

\u261b<\/strong>\nRead more\nabout deed restrictions<\/a> on Deeds.com.<\/em><\/strong><\/p>\n\n\n\n

Finally, if you own investment properties, you\u2019ll want to\nmake sure your home or condo renters are playing by the rules \u2014 your rules, your\nassociation\u2019s rules, and the local government\u2019s rules. Be sure your lease template\ncontains language expressly addressing subletting through peer-to-peer\nplatforms, or having roommates without the owner\u2019s knowledge and consent. A\nreal estate lawyer familiar with local restrictions, and your own goals and\nlimits, can draft the pertinent language. <\/p>\n\n\n\n

Pennsylvania Takes Some Air Out of Airbnb\u2019s Mattress<\/h2>\n\n\n\n
\"Image<\/figure><\/div>\n\n\n\n

In April 2019, Pennsylvania\u2019s Supreme Court startled\nhome-sharers. In the case Slice of Life v. Hamilton Township Zoning Hearing\nBoard<\/em>, the court decided that a tourist rental violated local residential\nzoning. Pennsylvania\u2019s Supreme Court focused on the significance of a \u201csingle-housekeeping\nunit.\u201d In contrast to the lower court and the courts of numerous other states,\nit decided a use of a house must be expressly allowed in a zoning district; if\nit wasn\u2019t expressly allowed, it was barred. This upheld Hamilton Township\u2019s\nposition, but it arguably forces zoning boards to rewrite rules to expressly\npermit certain unconventional uses of housing \u2014 including for addiction and\nshelter services. <\/p>\n\n\n\n

Then there was the case of Sara Ladd, who listed properties in Pennsylvania\u2019s Pocono Mountains on several sites, including Airbnb, HomeAway, and VRBO. The Pennsylvania Department of State investigated Ladd for allegedly running an unlicensed real estate brokerage. Ladd\u2019s lawyers successfully maintained<\/a> that forcing Ladd to jump through the hoops of getting a real estate broker\u2019s credentials violated the Pennsylvania Constitution. <\/p>\n\n\n\n

Most recently, Pennsylvania homeowners have been marketing their vacation cabins in the Poconos as pandemic-proof getaways. The governor determined that these getaways themselves were attracting interstate travel and presenting public health risks. Pennsylvania then moved to subject Airbnb and other short-term rentals to pandemic shutdown rules<\/a>.\u00a0<\/p>\n\n\n\n

The Poconos weren\u2019t the only place where this tension arose. There were reports from Pittsburgh<\/a> of property owners exploiting loopholes in local rules, and short-term visitors flouting the state\u2019s public health rules. <\/p>\n\n\n\n

In a Nutshell\u2026<\/h2>\n\n\n\n

Airbnb is hot. It\u2019s changing the way people all over the\nworld make travel plans. Yet it has also touched off tensions in communities,\nespecially when hosts appear to be circumventing state and local policies. <\/p>\n\n\n\n

We have only scratched the surface of the many ramifications\nof renting out your house on a short-term basis. And residential hosting laws\nwill be in flux for some time to come. Websites can offer generally applicable\nnews and information. But general information cannot be considered, and does\nnot substitute for, an attorney-client relationship and case-specific advice.<\/p>\n\n\n\n

The moral of the ongoing story? Property owners who\u2019d like\nto rent out space in their homes should gain a familiarity with the prevailing\nlocal policies and attitudes. And they should speak with a local real estate\nlawyer about current rules before getting started. <\/p>\n\n\n\n

Supporting\nReferences<\/strong><\/p>\n\n\n\n

Slice of Life v. Hamilton Township Zoning Hearing Board, 2019\nPa. LEXIS 2363 (Pa. Supreme Court, 2019).<\/p>\n\n\n\n

Ladd v. Real Estate Commission, et al. (Pa. Supreme Court, 2019).<\/p>\n\n\n\n

Photo credits: Filios Sazeides<\/a> and Anne Nyg\u00e5rd<\/a>, via Unsplash. <\/p>\n","protected":false},"excerpt":{"rendered":"

The enduring appeal of the family-run bed-and-breakfast has met technology. With an app from Airbnb (from “air mattress B&B”), or the somewhat similar VRBO (\u201cvacation rental by owner\u201d), homeowners can make money from their extra rooms or even their entire houses. More than 5 million listings appear today on Airbnb’s website, in more than 100,000 […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[71],"tags":[],"class_list":["post-1158","post","type-post","status-publish","format-standard","hentry","category-general"],"yoast_head":"\nAirbnb: Why It\u2019s Hot, How It Works - Deeds.com<\/title>\n<meta name=\"description\" content=\"More than 5 million listings appear today on Airbnb's website, in more than 100,000 cities all over the world.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.deeds.com\/articles\/airbnb-why-its-hot-how-it-works\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Airbnb: Why It\u2019s Hot, How It Works - 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