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Wednesday, September 22, 2021

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News + PoliticsThe Airbnb law is failing. Here's how

The Airbnb law is failing. Here’s how

Supes hearing shows that enforcement of the law is barely happening. Plus: Should SF taxpayers underwrite the Super Bowl party?

There are more than 7,000 Airbnb listings in SF, and more than 90 percent are still illegal
There are more than 7,000 Airbnb listings in SF, and more than 90 percent are still illegal

JANUARY 12, 2016 – Nobody from Airbnb or any of the other short-term rental platforms showed up at yesterday’s hearing on enforcing the city’s law. No representative was on hand to tell the Land Use and Transportation Committee members whether the companies have any interest in cooperating with the city. Oh, they were aware that the issue was on the table, but the corporate execs chose to duck.

“It’s really sad for me to read in the Chronicle that the city administrator had to beg Airbnb to do the right thing,” Sup. David Campos noted. “That’s where we are today – instead of rules we are begging.”

Sup. Scott Wiener started the hearing off by saying that it’s “very important that the public has confidence that there is enforcement” of the existing law. He said that the law had only been on the books for a year, and the Office of Short-Term Rental Enforcement only really up and running for a few months.

But then we got the numbers, which are not terribly encouraging.

Kevin Guy, the head of the short-term rental office, said that his staff had received 1,318 applications for the permits that allow people to rent legally through short-term platforms. There are, at this point, 879 approved and registered hosts. Another 269 applications are pending.

He said that since the law took effect, his office has taken on 264 enforcement cases, and closed 109 of them.

Now: There is some dispute about how many STRs there are in the city. Guy said he thinks it might be 5,000. Ian Lewis, a researcher for Local 2, the Hotel Workers Union, testified that trade publications show Airbnb alone had 7,985 listings in San Francisco in October – and Guy says that Airbnb probably accounts for only half the STRs in the city.

Some hosts testified that they list on multiple platforms. Still, 5,000 is probably a floor, and Campos said his information puts the high end a closer to 10,000.

In which case, more than 90 percent of the short-term rentals in the city are still unregistered, and thus illegal. That’s not a very good record for the city’s enforcement agency.

Even if Guy is right, and the number is closer to 5,000, 80 percent are still illegal.

Here’s another sign of how bad it is: Peter Quan, who spoke on behalf of the organization San Francisco Homesharers, bragged that his group had more than 2,200 members. If the city had only registered 879, then more than half of his members are breaking the law.

“Maybe before you come down here and talk about your membership, you should try to get them all registered,” Campos said.

Wiener said he want to see the city “get off the STR roller coaster” and quit amending the law, so that hosts could feel free to register without worrying that the rules were changing.

But the hearing produced some useful information about how the board could improve the enforcement – not by changing any of the rules that impact hosts, but by mandating more cooperation from the platforms. Which, by the way, are making lots of money — $100 million in revenue in the last year alone, just from San Francisco, according to Lewis.

The first thing Guy mentioned – and it would be so easy for Airbnb and its competitors – is to provide the city with the addresses of any unit where there’s a complaint or a question about its legality. Right now it’s hard for anyone, including city regulators, to find out exactly which listing applies to which address; the platforms keep that intentionally vague.

“I’m constantly asked why we don’t just go on the websites, find the illegal ones, and send them a notice of violation,” Guy asked. But without the addresses, it’s hard to do that – not impossible, but time-consuming and staff-intensive.

In most cases, he said, the office responds to complaints; proactively seeking out violations is less of a priority.

That change would cost Airbnb nothing, not a penny, and would help quickly resolve complaints and investigations.

The other key change, which has been talked about for more than a year: Simply ban the hosting platforms from listing any unregistered units. This would have no impact on legal hosts, and would instantly end much of the abuse.

It’s mind-boggling that the supes refused to approve that amendment when it came up last year. With the clear failure of current enforcement, it’s crazy to think that the board can allow things to continue as they are.

“Airbnb and Homeaway are making fools of this board,” Lewis said.

As Campos put it, “the more you learn, the more it becomes evident that the existing law is not working.”

 

The committee spent some time talking about the costs of Super Bowl 50, and the message we got was this:

The city will spend taxpayer money – maybe $3 million or $4 million of taxpayer money – providing police, Muni, public works, and other support to the event. The city will probably take in more than that in increased revenue.

But either way, Sup. Jane Kim, said, “I think it’s a policy discussion whether private entities should pay for this event, whether it brings in money or not.”

Part of the debate involved an important distinction: Other big events, like Pride, and the Chinese New Year Parade, also require a lot of city services, and those event committees don’t reimburse the public till for the cost of additional police, Muni service, etc.

But – for all the complaints about corporate sponsorship of Pride – those events are not, by definition, corporate marketing. The entire purpose of the Super Bowl Village, the NFL Experience, and the rest of the local party hype is to promote a multibillion-dollar corporate conglomerate that exploits and endangers the lives of its workers.

Yes, it will bring free-spending tourists to the city. But the Host Committee has raised $50 million for the extravaganza, and it’s a fair question whether the city should be putting out any money at all to underwrite it.

“Three or four million dollars may not sound like a lot of money to the very rich,” Kim said. But to the rest of us, it’s … a corporate subsidy.

And there may be more trouble in Super Bowl City: several labor unions showed up to say that the contractors the Host Committee has hired are not friendly to labor.

One of them: Bauer Transportation, which is involved in a nasty fight with the Teamsters. The union just lost an election, but have accused the company of “threatening and surveilling workers,” Doug Block of the Teamsters told the committee.

“This is not the kind of company we want to be doing business with,” Block said.

In fact, he said, “there could be some disruptive impact” if the issue isn’t settled.

SEIU’s United Service Workers West was on hand, too, to complain about a security contractor, Security Industry Specialists.

So there is a lack of labor peace, and even Wiener acknowledged that it could be a problem.

We all know what’s really going on: The city has to bid for the Super Bowl, and to get it we have to give up a lot, and things like making sure the taxpayers aren’t on the hook isn’t part of the discussion. We have to love the NFL, and give the NFL what it wants, and that’s what this massive money machine is about.

 

 

Tim Redmond
Tim Redmond has been a political and investigative reporter in San Francisco for more than 30 years. He spent much of that time as executive editor of the Bay Guardian. He is the founder of 48hills.
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136 COMMENTS

  1. Airbnb is definitely breaking ADA law. Their “compliance” page is inaccurate and confusing. I suffered from this as a result. My “vacation” turned into a huge effort to heal from anxiety and taking medication after having been off of medication for PTSD for a year.

  2. I’m fine with throwing in Craigslist if they are not being under this legislation, but i’m not going to get my panties in a bunch about it. I’d like to see Airbnb and others act like good neighbors and citizens, either way.

  3. Depends on what creates asymmetric enforcement. If there is a good regulation with which party A complies easily but party C can’t, it is okay that party C is the one that sees all the enforcement efforts. If there is a good regulation that the regulator chooses for whatever reason to enforce only against party A, then that is not okay.

  4. Sure, but not to the detriment of some playing by the rules. Just because it is hard to create law that will effectively enforce against all, it is not reason to not enforce against some, no.

  5. Institutionalizing conversion of residences to hotels? 1,100 units is 0.3% of the city. 100 multi-unit hosts is 0.01% of the population.

    It is possible both to agree zoning exists for good reason and should be enforced and to believe Airbnb is a small issue. It is difficult to foot concerns with Airbnb with lack of concern with Craigslist. Doesn’t everyone need to play by the same rules?

  6. I’m not worried about Craigslist. It’s sites like Airbnb, etc which work so efficiently that they are institutionalizing the business of renting residential units as hotels that I’m concerned about. If you are concerned about Craigslist, more power to you, but not being concerned about Craigslist or admitting Craigslist would be harder to regulate does not make concerns about Airbnb, etc moot or invalid.

  7. No, coach, it’s the question with which this thread starts: https://48hills.org/2016/01/11/the-airbnb-law-is-failing-heres-how/#comment-2453697576

    ..1,100 units in town the owners or tenants or which are breaking the rules. There are around 100 hosts with five or more listings..

    ..why focus so much energy on barely a thousand units?

    Let’s say we ban and liquidate Airbnb and VRBO. Does that mean we ban and liquidate Craigslist? The exact same illegal activity is going on on Craigslist, which they choose not to curb.

  8. You are bringing up a lot of interesting questions, none of which really change the fact that illegal activity is going on on Airbnb’s site, activity which they could easily curb, but choose not to. Their unwillingness to act in good faith to ensure legal activity on their platform is a slap in the face of San Franciscans, and tells you all you need to know about the company.

  9. Apologies, coach, but it gets hard not to be cheeky when the first words out of a fellow’s mouth are, ‘you seem dense.’

    The world would be a better place if the Airbnb and VRBO business model were simply banned and the companies liquidated. That said, their effect on most people can be approximated by a nice, round zero. What about these companies deserves so much of our energy?

  10. So, none: there are no regulatory schemes that rely on voluntarily acting like good neighbors. The working model is regulation.

    Airbnb, Craigslist and friends absolutely are taking a political risk, yes. Why, however, should activists and advocacy sites expend all this energy looking out for the shareholders of those companies?

    One piece of advice, coach: watch out for the second person.

  11. I’m not trying to have a philosophical or academic discussion. However you try to obfuscate, the reality is pretty simple – Airbnb and others can take a simple and easy action to see that activity which violates the laws of San Francisco is not taking place on their site, or they can cultivate more bad faith with legislators. No citizen, corporate or otherwise, which fosters so much illegal activity, most especially when they have an easy ability to curb it, is going to be in good graces with the powers that be. You think you are clever, but your attempts to divert the discussion from that of Airbnb’s arrogant and disrespectful business practices are incredibly see-through to anyone reading them.

  12. Interesting. What other regulatory schemes rely on voluntarily acting like good neighbors? Are there good models to emulate?

  13. As noted not original. The dataset will be the Census Building Permits Survey, MSA, looks monthly 3m avg. Planning has completions for the city alone, annually. Permits are a pretty good proxy for completions, https://research.stlouisfed.org/fred2/graph/?g=38uQ

    3,500 completions in 2014 are a monthly 0.03% of pop. The national rate checks, the city and MSA patterns seem similar.

  14. I think as long as Airbnb and VRBO act like a good neighbor and do the exceedingly easy thing to make sure illegal activity is not going on on their site, the rest is not really an issue.

  15. Unless those 100 are managing the the listings.

    The problem when Air BnB doesn’t adhere to regulations or self regulate is it leave us to run with crackpot theories and personal ideologies. Never a good idea to create a narrative.

    You do raise a good point though – there’s a lot of focus on something that’s not that big of a problem as opponents want it to be.

  16. When there’s an argument based on data (like the chart you presented), that’s one thing. We can talk about whether the data support the model or not. On the other hand, when the argument goes “if you build and the price doesn’t go down, it just means you should build even more”—how can you argue with that? It’s unfalsifiable (to be technical), just like the prayer argument.

  17. Sorry for that. It does seem contrary to evidence to equate the efficacy of building enough homes for people with prayer.

  18. Except that there is ample evidence that wherever we build enough homes for people to live, prices are moderate. The irrational actors are those who plug their eyes when someone posts a chart of housing permits to population, as if there were nothing in the data.

  19. How charming! Thanks for the kind words, coach.

    It is a powerful motivation for political energy that a business openly violates the law as policy. It is by contrast weak soup if a business follows the law but fails to meet the standards of online blowhards.

    Relying on corporate virtue is not just ineffective regulation, it is bad regulation. Not requiring good corporate citizenship subsidizes bad actors, as the latter profit from what good citizens eschew.

    Airbnb is not doing anything illegal. What law should we pass to regulate Airbnb, and Craigslist, and VRBO, and everyone?

  20. You seem dense. The commenter’s point is that a company that does not take an easy action to encourage lawfulness by its partners is not a good corporate citizen/neighbor. It would be simple as pie for Airbnb to require registration numbers, which would make sure only lawful activity was going on their site; they refuse to do this. Airbnb is not doing anything illegal. But there is illegal activity going on on their website, which puts them in bad standing with the city government.

  21. Just because building “way less than demand” didn’t work, doesn’t mean that building way more would work, without any sign that that would work. After all one could say that we should lower housing prices by prayer, and if that doesn’t work—obviously we’re not praying enough.

  22. I think you’re car should provide information to the police when you violate speed limits now as well. Modern cars have GPS and track your speed, it can tell when you’re going too fast on any given stretch of road. Would make enforcement of the speed limit much easier, since > 90% of all speeders go unpunished today.

    As more and more devices we use and services we use have information about what we do and when, government enforcement should get easier and easier, right? We just need to require these new savvy devices and services do that work for us. This is not just a one service kind of thing, this should be a trend as all of our devices get smarter and smarter; as more of our services get integrated and we can identify who is doing what online.

  23. My view is that, unless there’s a particular and compelling reason not to (which the anti-housing crowd in SF has not come particularly close to providing), cities should be allowed to grow to meet demand. People should be allowed to live places, which means people should be allowed to build and sell places to live, if political entities can’t or won’t. If the demand for SF housing were really so great that prices did not fall much from such a building boom, it’s horrifying to think how much more expensive the no-growth version of SF would be. And the idea that there would be no infrastructure improvements with such growth is absurd–that would be one of the obvious things to spend a good chuck of all that new tax revenue.

    We’ve tried a “build way less than demand” approach, and it’s created the most unaffordable city in North America by a wide margin, so the “what if it doesn’t work?” routine seems a little silly. We know damn well the status quo doesn’t work.

  24. Fine. We’re talking about tripling the city, but with the same infrastructure. That would mean leveling many square miles and rebuilding them. It would take a long time. And then, what if the prices didn’t go down? What if they went down by10%? What if they went down, then back up after 10 years to where they were? If you want to prevent sprawl, is SF the best place to put these million units?

  25. If you build a million units in SF and lower prices by 25% (until they rise again), will the whole thing be worth it?

    Of course! A 25% reduction would be a great benefit to many people stretched very thin trying to live in the city now, and of course the environmental benefits of adding most of our new housing in dense, walkable places with good transit and near many jobs can hardly be overstated. The alternative is more sprawl; a disaster for commuters and future generations alike.

  26. No idea about VRBO. Obviously everyone should be subject to the same laws.

    Craigslist is trickier. It’s harder to identify violators automatically. Do they have someone scanning the ads? What happens if I put up an ad saying “stolen bike for sale”? Would it have to wait for someone to complain before it’s taken down?
    In any case, of course the city should keep an eye on CL as well and figure out some appropriate policy.

  27. We’ve talked about it a lot on other threads here. It’s a hard problem, right now affecting cities all over the world: cities get expensive, they build (in some cases a lot), and they get even more expensive. Before anything else, it’s important to realize what isn’t working.
    I think that reducing the demand and reducing income inequality are promising directions to go in, which don’t seem to be explored enough, but I don’t have a ready simple solution.

  28. Say that you’re right. That seems kind of fatalistic, doesn’t it? If building doesn’t matter, we might as well keep our low skylines. The city will be for rich people, and a few thousand lottery-winners in subsidized housing. That sounds terrible.

    What do you suggest? What’s the end-game?

  29. There is some ill-will toward AirBnB, which makes people suspect them from the beginning, but they earned it. In this case much of the blame is directed at the city, which is trying very hard not to regulate AirBnB and not to anforce whatever regulations exist.

    The Ma Bell analogy is farfetched (and here, I am afraid, you are acting obtuse). They cannot police billions of phone calls, and there are no clear guidelines as to what they would be after. In the case of hosts listing multiple STRs, the definition is clear and the enforcement is trivial.

    But all right. Suppose they won’t lift a finger unless they are forced to. That’s legal, though it’s poor corporate citizenship. In that case the city should make them delist unambiguously illegal units.

  30. Not intentionally. Just feels like the focus on Airbnb comes first, with explanations grafted on later. A little like not building homes for people, where there always seems to be a good reason not to.

    ‘Looking the other way’ is the default utility position. It was never Ma Bell’s job to police what was said on telephones, and it isn’t Craigslist’s job to police what is sold in its for-sale section.

    Speaking of which, shouldn’t Craigslist be in this discussion?

  31. I don’t think he obtuse, but on this thread it seems a bit so – that is why I recommended calling a doctor. Even when I disagree, I enjoy his posts and often learn something from him. It is refreshing that he post data to backup what he writes.

  32. OK, I think I wasn’t clear. There are 40 residential units total. 1,100 / 40 (on residential block) = 27+ blocks of AirBnB rentals that have been taken off the rental market. I’m not sure the number of vacation rentals – many of them no longer list in AirBnB, but they still are used for vacation rentals: There are 4 complete units that I know of for sure and 2 bedroom only units that I know of for sure within those 40 units total.

  33. All right, but I think you are acting more obtuse than you actually are. This is a discussion, not a court of law. I concede that I don’t know what ABB’s official policy is, but they are looking the other way and without a doubt they know it, and the city is trying very hard not to touch them. We have a great number of violations, all excused under the same umbrella.

  34. I’m not convinced the premises are correct, following what I wrote. a) wouldn’t happen with private development. b) and c) may or may not lower prices, depending on population influx. Anyway we need numbers for what is “a lot” or “a little”. If you build a millioin units in SF and lower prices by 25% (until they rise again), will the whole thing be worth it?

  35. The police come, but it takes a lot to trigger people to complain on my block. But if someone is going to convert their residence to a business, they should have to let their neighbors know and provide a contact number for when things go wrong. It’s probably better for the “host” as well – I’d certainly would want to know if I my “guests” were annoying the neighbors, trashing my unit or whatever.

  36. 40 units in one block? That is a lot. The magic of North Beach.

    Well, jeepers. What happens when neighbors complain?

  37. Ha, yes. Another trick: direct replies still show in Disqus’s own notifications, allowing for quick downvotes without unblocking.

  38. On my block, counting both sides of the street, there are 40 units total, maybe a bit less. So we are talking about more than 25 blocks of housing in those 1,100 units. I see that as a lot.

  39. ..but currently any resident can call and complain, just as he or she might for another planning, building or health code violation. The question was what neighbors can do once such uses are allowed.

    Responding to an extreme price squeeze resulting from a housing shortage by allowing occupants and owners to profit from the price squeeze seems backwards. Shouldn’t the focus be on ameliorating the price squeeze, rather than capitalizing on it?

  40. My point is that YOU should have the ability to make a call or send an email to complain and SOMEONE would follow-up and that there be a process for remediation.

    You are lucky that your neighbor isn’t in your building. In my other city, the 35 unit building has 4 AirBnB rentals. One was horrible but the neighbor is a good guy and he now provides a lot of oversight, 2 are bedroom rentals that are mostly OK and the worst is a tourist rental company that bought a place. Our HOA is suing the tourist rental company for actual damages and we are still in the process of banning full-time tourist rentals in our building.

    The upside: People are struggling to stay in their places – to stay in the middle class. Allowing them to make some additional money seems like the right thing to do.

  41. Perhaps. 1,100 units off the market and around 100 hosts with multiple listings barely seems material. What makes them significant?

  42. Because I don’t agree that ‘the numbers aren’t there.’

    Maybe we disagree about what “number” are significant.

  43. I have not seen a reliable study modeling the effect of building. More housing may simply attract more well-to-do people from elsewhere, with no net increase in supply. I see many cities which build a lot and still have prices go quickly. I can’t imagine developers wanting to build so much that their profits would suffer from over-supply.

  44. The neighbor two doors down has a single such unit, the only one on the block, yet the effect is very much that of living next to a hotel.

    What is the upside of allowing this neighbor to profit at the expense of the block and the neighbors that have to deal with the hassle?

  45. Today, I’m really not prepared to resolve all the issues that may exist with a new law that tightly regulates vacation-rentals in San Francisco. And I’m guessing that there are those with expertise who would be better at this. But I am sure that all of this is easy to resolve. Allowing one unit vs allowing the entire building would trigger different permit processes, and I seriously doubt that we would ever allow the conversion of an entire building.

  46. Gary, Y, fellas. Let’s play nice, please. We disagree on whether short term rentals should be a priority. The numbers aren’t there, an actual corporate policy to violate laws is missing. Yet many sincere and thoughtful people think short term rentals are worth a rather large amount of political energy and policy effort. Why?

  47. 1. Why do you think that building a lot more housing would have a negligible effect on rents?

    2. Given the following choices:
    a. Build enough housing for prices to drop substantially.
    b. Build a lot of housing, and prices will either drop or stay flat.
    c. Build a little housing, and prices will increase slowly.
    d. Build no housing, and prices will increase a lot.

    I’d prefer we do (a), but if we can’t do that, I think (b) is the second-best, and (c) is the third-best. Do you disagree, and, if so, could you help me understand why?

  48. Ah, that is the prior status quo. It was pretty easy to approximate the number of permitted vacation units: effectively zero. Conditional use permitting is tedious and expensive, not to mention the costly permit.

    What do neighbors do if they don’t want to live next to a hotel?

  49. You’re right. We need to give a pass to all “white-collar” crimes. Oh, that’s right, we already do.

  50. What kind words. Leaving aside the well-wishes, it seems easy to describe the benefits of traffic enforcement as part of an analysis of limited law enforcement resources. Red light cameras save lives.

    Does making Airbnb and short term rentals be a priority save lives?

  51. Tightly regulated: All vacation units are permitted (zoning). Permits are limited in number and are issued within specific criteria (housing). Contact numbers and enforcement are provided and have well-established processes (nuisance).

  52. Why support short term rentals at all? The status quo ante, if the rules were enforced instead of ignored, takes care of all these.

  53. By not taking trivial actions to keep the law enforced, starting with not listing multiple properties by the same owner.

  54. You realize that prop F, which limited AirBnB rentals to 90 days, was defeated in great part due to $8 million spent by AirBnB to defeat it, right?

    Because in London, the limit on AirBnB and other vacation rentals celebrated in that article, is 90 days. So what was awful here is celebrated as being a success in London. That’s some success.

    While I do have concerns about the overall trajectory of what it takes to remain in the middle class, moving from the era of only 1 income need per household to two or more, and moving to some needing 2 or 3 jobs by household income earners and now some having to rent rooms just to get by and stay within the middle class, I do support the concept of vacation rentals and short term rentals. But it needs to be tightly regulated.

  55. Not to get the argument further afield, I’m saying it is an economic impact of these illegal actions, but distinct from the supply/demand impact (or lack thereof) that David brought up.

  56. I wasn’t thinking about Uber. The Google Buses are a better example. It’s one thing if a hundred separate people commit infractions. It’s another when a big corporation tells its employees to commit infractions and tells the city to shove it.
    At least they are cracking down on graffiti advertising. Same deal exactly.
    As to “priority”: yes, it is a priority. If they can get away with it they’ll do a lot more, and others will follow their lead.

  57. Your number 5 says that Airbnb’ed units reduce the RC stock. But then so do TIC formations, condo conversions and owner occupation. But condos aside, all those units may return to RC one day. And if they do not, isn’t the blame the current rent laws that make that unattractive?

    Given that no new RC units can be created, the number of RC units will decline forever in any event.

  58. OK, thanks.

    Just for the record, Airbnb hasn’t been banned anywhere, despite your VERY impressive list. Great work!

    Yes, it is something new that offers benefits to travelers and homeowners alike but like many new concepts it requires some oversight.

    For example, you list London as a city that has “tightly regulated or banned Airbnb”. Just for comarison’s sake, here is the truth:

    http://www.theguardian.com/travel/2015/feb/10/airbnb-to-be-legalised-in-london

  59. “What about Airbnb and short term rentals suggests these should be a priority on which to generate and focus policy and politics?”

    Loss of tax revenue, illegal conversions of use, non-compliance with safety and other regulations, lack of accountability and public nuisance.

  60. Are we talking about Uber? Airbnb certainly has no affection for regulation, but how does ‘violating the law openly as a matter of policy’ describe them?

    Let’s say this does exactly describes Airbnb. Does that make them a priority worth this much energy? And why not roll back the law to the prior status quo and start enforcing the rules against short rentals without conditional use?

  61. Yep, Is isn’t about refusing to pay or facilitate paying taxes, it isn’t about only listed permitted units, it isn’t about displacement of long-term residents for illegal short term rentals, it isn’t because of so many problems that AirBnB has been strictly regulated and/or banned in Paris, London, Berlin, Barcelona, Madrid, Amsterdam, New York, San Francisco, Santa Monica and being cosidered for being banned/regulated in many other cities, no, it is all about Conway. Because they hate Conway in London, Paris. . . .

  62. Policy involves balancing priorities, politics involves generating and using a limited amount of energy and motivation. If the policy preference is ‘make things better for people’, then the policy areas to make priorities are those that best make things better for people.

    What about Airbnb and short term rentals suggests these should be a priority on which to generate and focus policy and politics?

  63. The big issue is that it’s a powerful corporation who is violating the law openly as a matter of policy and is getting away with it. If they do, why won’t they or someone else push to get away with ten times the violations?

    To use your “every driver and bicyclist who does not come to a complete stop” analogy below—what if a pizza chain instructed all of its delivery cars to treat red lights as stop signs, so they can deliver hot pizzas faster, and if the Mayor, flanked by an investor in the company, kept the company and its drivers from getting ticketed?

  64. Progressives freak out at the name Ron Conway, who was an early investor in AirBnb (although not a major one, as they claim). He also invested in Google, Paypal, Facebook….don’t think that he really needs Airbnb to keep his 401K solvent.

  65. How many metaphors can you use to minimize this? FYI, I prefer ‘ticky tacky’ to ’rounding error.’ Why not call AirBnB a kitten, and regulations ‘kitten killers’ ?

  66. Right, enforcement is good. Let’s support it, then stop worrying about Airbnb. Airbnb is a rounding error in the grand scheme.

    Why is there so much ire and energy directed at a rounding error?

  67. If you evict for OMI or Ellis then you cannot do any kind of rental for several years either way. Civil remedies already exist for that.

    But if an owner had a bad tenant and has to evict for cause, it seems reasonable that they might not want to be stuck with another long-term controlled tenant, and do STR’s instead. Tenancies of under 30 days are exempt from rent control.

  68. Because lack of action encourages more people to participate vacation rentals. And it’s against the law. And it is wrong. This isn’t jaywalking. Until the thread of legal action, AirBnB refused to collect taxes, which robbed the city of hundreds of thousands of dollars, maybe more. What about the other platforms?

  69. STRs can be highly profitable in a number of situations, but certainly more so when you evict someone from rent-controlled housing to establish an STR unit.

  70. Most of the rentals in the city are not ADA-compliant, because most are walk-up’s. Evidently it’s not a problem and ADA doesn’t apply.

    I once had a tenant who asked me to make my building suitable for him when he became disabled. The cost would have been prohibitive. I asked the city if they would pay and they said no. So I told him there was nothing I could reasonably do and, a few weeks later, he moved out

  71. If you expect the effect on affordability from bringing new units online to be negligible, are your expectations for the impact of returning AirBnB units to the rental market different? If so, why?

  72. I never said STR’s weren’t profitable. I said that when the extra hassles are taken into account, they are not MORE profitable than LTR’s.

    I agree with you that using a condo for STR is dumb. But more because condos are exempt from rent control, so it’s easier to just do a LTR and raise the rent each year.

    A reasonable rule of thumb is to do LTR’s for SFH’s, condos, live-work units and post-79 construction. And do STR’s or corporate/academic lets for controlled units, or live in it of course.

  73. There are strong arguments to return to the prior status quo, that is again to forbid any conversion of residential units to hotels. Those arguments begin and end with land use. Zoning residential areas excluding hotels has a long history because it works. Great.

    Putative violations of the Fair Housing Act or the ADA, or effects on the residential housing stock, or tenant nuisances, not to mention hearing after hearing at the city level, seem disproportionate.

    Which gets us back to the start: why expend all this energy here?

  74. Cynthia, there is a limit to how much “control” the city can and should have over what you do in your own home. Not letting you build a nuclear reactor in your spare bedroom is fine. Not letting you occasionally share your home with a visitor is not.

    Let’s get real here. Campos wants to ban any alternative use of a home except for owner occupation and long-term controlled rentals. But in the end the city cannot force anyone to do long-term rentals if they do not want to.

    How about a carrot instead of a stick?

  75. Now that the issue has been identified by Harvard Business School, I do believe we will see people come forward with complaints.

  76. Tim pretend that supply and demand have nothing to do with the affordability crisis most of the time, until the basic logic of supply and demand becomes a useful cudgel against their political enemies.
    My analysis is that the LoS&D works just fine, and that building at the current rate, or even at a much higher rate, will a. have a negligible effect on rents, b. will look good on a politician’s resumé, and c. will make big profits for developers. I am only interested in (a).

  77. “..and Airbnb makes its hosts aware of their legal obligations. The violators in this case are the hosts, unless the law changes. Airbnb appears to be complying with the law, and does not appear somehow to be encouraging its hosts to violate the law themselves.”

    Really? Appears? You mean the way they “appear” to be complying with the law that all rental unit in San Francisco must have a permit? Oh, that’s right – that’s “ticky tacky” or some other nonsense.

  78. 1. I’ll just say that the question is the size of the effect. Will these 10,000 units reduce the average rental by $1000? $10? If the latter, then the effect is lost in the noise. We need a reliable quantitative study showing what the effect will be.
    3. What I am asking (as are the BOS) is to enforce current laws. I’m not talking about whether these laws should exist, i.e. whether STRs should be less regulated. There are laws on the books, and the city won’t enforce them, which is wrong in principle, but also keeps thousands of units off the housing market, contrary to stated city policy.

  79. ..and Airbnb makes its hosts aware of their legal obligations. The violators in this case are the hosts, unless the law changes. Airbnb appears to be complying with the law, and does not appear somehow to be encouraging its hosts to violate the law themselves.

    Seems most appropriate to focus on racism, because almost all hosts using residential units will be exempt from the ADA.

  80. No, the opposite: in a country so deeply and offensively racist, the lack of enforcement actions is an indictment of the apparatus: hotels almost certainly still discriminate, yet there are few actions. If a hotel doesn’t rent a room to people because of African-American sounding names, they are probably not busted by the Feds.

    This list of actions is less sparse, but still embarrassingly short.

  81. Oh, I’m not disagreeing with you. If you can provide an example where Airbnb denied accommodation based on race then, yes, by all means, they should be held accountable.

    But you, um, can’t seem to provide a single example of them doing so.

  82. I didn’t single out racism. I was discussing compliance with laws such as public accommodation and ADA. You directed me to a nice webpage that had a list of rules, and then you asked for further information. I cited a study I saw on the BBC.

  83. Yes, it trivializes racism to use its existence as a cudgel to effect a completely different goal. The argument here is not based on racism.

    It is puzzling to see critiques of potential nuisance paired with arguments in favor of allowing short term rentals so long as they are regulated. What was wrong with the prior status quo when short term rentals of units zoned residential required a conditional use permit?

  84. I think you need to make an appointment with a doctor. Usually, you don’t stoop to such ridiculous arguments.

  85. “. . .disfavored party. . .” You accuse me of trivializing racism and yet you refer to a $25+ billion company as a ‘disfavored party’.

    Having a webpage with a few rules is not enforcement.

    And while AirBnB is collecting taxes, are the other platforms? No, we need to have strict regulations because having lax regulations has not worked.

  86. And you can point to an example where Airbnb refused to rent a room to someone because of their race? Wow. That is big news.

    Why haven’t you reported it to the justice department?

    What about all of the dating sites where users are obviously figuring race into their decision process. Shouldn’t we be shutting down Match.com and Tindr as well???

  87. Agreed, Airbnb almost certainly is part of the problem, but almost equally certainly not uniquely. The US is deeply, offensively racist. Pointing fingers at a disfavored party that does not offend uniquely or have unique responsibilities trivializes the issue. Don’t trivialize racism.

    Isn’t tourist nuisance an argument to return to the status quo ante?

  88. Bullshit. If a hotel is found to not rent a room to people because of their African-American sounding name, they are busted by the Fed.

  89. That’s a cheap shot. Everybody knows that the internet itself is inherently racist. Read ‘Dataclysm” by the guy who founded OK Cupid.

    Can you point out a single thing that Airbnb does to foster racism? Didn’t think so. Just a cheap shot, for whatever reason.

  90. I would like to see AirBnB’s statistics for how many listings they have deactivated because of findings of racism, non-ADA compliance, etc. Until then, they are part of the problem.

    As of nuisance occupancies, assuming that most rentals are vacation rentals, just visit Fisherman’s Wharf to see who they are being rented to and do the math. Tourists are often clueless of how to behave in rental units. In an hotel, this behavior is confined to and dealt with by the hotel. Not so in your building. Often, the problems become everyone’s problem.

  91. “Doesn’t the nuisance factor apply to all tenancies, whether short-term both registered and unregistered or long-term?”

    No. In my case, the owner didn’t know that the tenant rented out the unit on AirBnB. The tenant was nowhere to be found and and after a few days the police had to be called to evict everyone. It was a mess and while we all found out that it was an AirBnB rental, there was no way to contact anyone. If AirBnB wants to make money by providing a platform, they need to also assume some of the risk-mitigation, like Amazon does.

    AirBnB racism claim: African-Americans ‘less likely to get rooms’

    http://www.bbc.com/news/technology-35077448

  92. It’s not “… paranoia about how people use their property.” It’s about how land gets used and how neighborhoods are planned and executed.

  93. Doesn’t the nuisance factor apply to all tenancies, whether short-term both registered and unregistered or long-term?

    What is the argument about public access and ADA?

  94. You obviously haven’t lived next to an AirBnB rental that has gone wrong. It isn’t only about units not offered to long-term residents.

    There is an entire nuisance factor that is very important. And probably evasion of ‘public access’, ADA and other regulations as well.

  95. The rest are ticky tack violations. Those listings violate the black letter of the law, but so does every driver and bicyclist who does not come to a complete stop behind the limit line at every stop sign.

    Red light cameras in the city are programmed with a small grace period, 0.3 seconds maybe. Ignoring ticky tack violations is part of effective enforcement.

  96. The answer is simple: Make it illegal for AirBnB and other platforms to advertise any unit that does not have a permit.

    Then fine AirBnB and the owners/renters of any unit on AirBnB that has no permit. Real fines, not slaps on the wrist.

    Use the fines as seed money to support an enforcement unit in SF.

  97. “There are around 1,100 units in town the owners or tenants or which are breaking the rules. ”

    So all of the rest are registered with the city? I don’t think so.

  98. Campos said his information puts the high end a closer to 10,000

    Inside Airbnb shows around 1,600 whole units recently and highly available. Some of those, it turns out, need no registration as they feature 30-day minimums. Download SF data and filter for whole units with a review in the last six months, calculated availability of at least 90 days and at least 2 reviews per month: around 1,100.

    Good regulation is important, as is steady, effective enforcement. There are around 1,100 units in town the owners or tenants or which are breaking the rules. There are around 100 hosts with five or more listings. Enforcement here would not seem hard.

    This does raise a question: why focus so much energy on barely a thousand units?

  99. There have been business plans built around short term rentals. One poster on 48 Hills even described a situation where a condo was purchased for exclusive use as an STR. The owner finally gave up and sold it after neighbors complained and it was found to violate condo rules.

    You won’t convince me that STRs are not profitable. See http://www.propertymanagementsoftwareguide.com/blog/risks-and-rewards-of-short-term-rentals-1122011/

    In recent news, one woman has asked the Planning Commission to approve her long-time use of a three-unit victorian as an STR.

  100. Actually everyone thought the rules were working, or rather that we didn’t need any, until about 3 years ago, when all this furore about Airbnb started up.

    Suppose I use a European version of Airbnb to find my guests. How will the city impose such a requirement upon it, when the city has no jurisdiction there?

    Obviously the city cannot. And that is all part of the fallacy that a virtually-located sharing economy website service can be effectively managed by an old-school “command and control” regulatory framework.

  101. I’ve done both STR’s and LTR’s, even for the same unit, and I’d put if differently. To take my most recent example, I have a 1-BR that would rent for about 4K a month long-term and it typically goes for $150 a night (varies by day of the week or time of the year).

    So at first sight it looks like you are correct – the STR use pays more. But consider the other factors for STR use:

    1) I have null periods
    2) I have to furnish and equip the place
    3) I have to find guests constantly
    4) There is cleaning/housekeeping after every stay

    Suddenly the STR doesn’t look so good. The reality is that STR’s do not pay more when everything is factored in. It is more effort and hassle even without the regulations. But crucially I avoid the risk of getting a tenant who then doesn’t move for decades.

    In reality I have finessed the difference and try and find short-term tenants who stay for 1 to 6 months. Usually European people on temporary work or academic assignments – UCSF and the tech companies are good sources.

    The real point is that I feel I always I have to stay one step ahead of the ever-growing paranoia about how people use their property. And it really should not be like that. If rent control were abolished, I would go LTR on all my units the next day. But otherwise it’s not happening.

  102. You’re assertion that rent laws are promoting STRs may be partially correct, but it ignores a larger factor: you can make a lot more with an STR than you can with a long-term renter. Your profits are even greater if you avoid registration and ignore provisions of the STR law.

  103. It’s obvious the rules aren’t working and it was obvious before last year’s election. They need to be fixed and a simple amendment — requiring all STR listings to contain a city registration number — will do it.

    “Give the law more time to work” was a rallying cry for the opponents of the STR initative. It was BS at the time and Weiner knows it.

  104. The working premise for any regulations should be that an important public policy imperative is being achieved. The theory here is that if doing STR’s is limited, those homes will magically become LTR’s. The problem with that is obvious – the people doing STR’s have mostly already decided that they don’t want to do LTR’s, because of the rent laws.

    Asking intermediaries for information looks like an invasion of privacy. If the city has probable cause it can subpoena Airbnb for details on a case-by-case basis. But asking for everything for fishing expeditions is unjust and arbitrary.

    Besides, it’s easy for the city to harass Airbnb because they are in the city. Their competitors are outside the city, state and even country. There is no way the city can get heavy-handed with STR services based elsewhere. I have used sites in Germany, Holland and the UK, targeting European visitors, and they are under no obligation to listen to the city or obey its “rules”.

    The war on STR’s is misguided. Any housing problems we have are caused more by excessive regulations than by home-sharing

  105. Whatever you think the rules should be, it’s surely a good thing if they stay fairly constant so that businesses know the deal and what to expect. There is a real risk with all this tinkering that a business could gof rom being legal, ot being illegal, and then legal again without changing its activities in any way.

  106. “Wiener said he want to see the city “get off the STR roller coaster” and quit amending the law, so that hosts could feel free to register without worrying that the rules were changing”

    Does Wiener really believe this BS? If so I have some questions about his mental stability.

  107. 1. The law of supply and demand holds just fine. If you add 10,000 units to a city of 850K people and simultaneously bring in 20,000 people earning a lot more than most everyone else, prices won’t go down. Econ 101 and all that.

    Well, yes, but for the reasons M. Montrouge identifies, prices do go up less quickly if you add those units. Tim and his anti-market rate housing allies pretend this isn’t the case or claim that if adding housing isn’t bringing rents down, it’s pointless, as if rents going up less quickly is meaningless.

    3. To turn your argument around, the Mayor and his allies telling us to swallow every mostly-market-rate mega-project that comes around because it may somehow stabilize housing prices, and then refuse to touch the AirBnB units, making some question their motives.

    I don’t disagree at all (except your characterization that allowing new housing to be built is inherently a painful thing for current residents to “swallow”); I would have voted for the AirBnB law had I lived in the city, due to the current circumstances–in a healthy market, I’d have no problem with AirBnB doing their thing; it’s a nice alternative to hotels that allows more of the plebes from the heartland (like me) to be able to afford a visit to one of America’s great cities, but under conditions of a housing shortage, residences for residents is more important. I’m just struck by the hypocrisy; people like Tim pretend that supply and demand have nothing to do with the affordability crisis most of the time, until the basic logic of supply and demand becomes a useful cudgel against their political enemies, when they (correctly) identify it as obvious common sense.

  108. 1. Those extra 20,000 people are going to come regardless of the fact that 10,000 units were added (demand for high rise condos did not bring tech here). Rent will increase regardless so long as supply does not meet demand, but it doesn’t mean adding more supply to stabilize rents is a bad idea.

    3. Increasing supply to lower or stabilize rent is a pretty recognized concept, no need for the “somehow.” As for Airbnb, they are not the governments units to touch. Should the government compel you to rent out every inch of unused space so as to give someone a place to live, would be an easy way to solve homelessness, screw property rights right? Government needs to be incentivizing long term rentals, and it says something that people are willing to forgo a stable tenant and often times total rental profit to avoid having long term tenant.

    4. Don’t disagree there, but the flipside is that progressives (especially David Campos) unfairly target Airbnb over other platforms. If short-term rentals were such a problem, why didn’t progressives on the board introduce legislation first? Seems that outrage materialized mostly so that Campos could try to make an election issue out of it. Coincidence that he’s been the biggest opponent on the board?

  109. David, I am not Tim or his allies, but the way I see it is:

    1. The law of supply and demand holds just fine. If you add 10,000 units to a city of 850K people and simultaneously bring in 20,000 people earning a lot more than most everyone else, prices won’t go down. Econ 101 and all that.
    2. You are quite right, whether these 10,000 units are new units or freed up former AirBnB units makes no difference to the calculation. However:
    3. To turn your argument around, the Mayor and his allies telling us to swallow every mostly-market-rate mega-project that comes around because it may somehow stabilize housing prices, and then refuse to touch the AirBnB units, making some question their motives.
    4. Ron Conway, an early and major investor in AirBnB, is a close advisor of the mayor, and is often at his side. That is at best unseemly, and suggests that the Mayor is, let’s say, biased.
    5. Any AirBnB units which were formerly rent-controlled apartments are reducing the RC stock in the city. That is an economic impact distinct from the supply and demand issue.
    6. Anyone who evicted tenants in order to AirBnB their place and got away with it is giving encouragement to more landlords to do the same. That is yet another separate impact.

  110. I’m still really curious if Tim or any of his allies have ever tried to give an explanation for supply and demand is utterly meaningless for the affordability crisis when it comes to restricted housing supply from restrictions on new development, but it becomes important and relevant when the supply restrictions are due to the STR market.

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