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Hotel CEO Openly Celebrates Higher Prices After Anti-Airbnb Law Passes (washingtonpost.com)
An anonymous reader quotes a report from Washington Post: A hotel executive said a recently-passed New York law cracking down on Airbnb hosts will enable the company to raise prices for New York City hotel rooms, according to the transcript of the executive's words on a call with shareholders last week. The law, signed by New York's Governor Andrew Cuomo on Friday, slaps anyone who lists their apartment on a short-term rental site with a fine up to $7,500. It "should be a big boost in the arm for the business," Mike Barnello, chief executive of the hotel chain LaSalle Hotel Properties, said of the law last Thursday, "certainly in terms of the pricing." Barnello's comment adds fuel the argument, made repeatedly by Airbnb and its proponents, that a law that was passed in the name of affordable housing also allows established hotels to raises prices for consumers. It was included in a memo written by Airbnb's head of global policy, Chris Lehane, to the Internet Association, a tech trade group, reviewed by the Washington Post. LaSalle, a Bethesda, MD-based chain, owns hotels around the country, including New York City. The memo is the latest volley in a bitter fight that has pit the hotel industry, unions, and affordable housing advocates against Airbnb and its supporters. At the heart of the fight is a debate over the societal value of the Airbnb platform and its role in the economy of cities throughout the world. The question is whether Airbnb has been a net benefit, by enabling middle class city-dwellers to make extra money by renting out their homes, or whether it has had the unintended consequence of exacerbating affordable housing crises in expensive cities such as New York and Los Angeles.
here in NYC data from AirBnb showed that most of the apartments for rent for always available for rent because the owners were making more money on it then renting them out as housing. in a lot of cases it was affordable housing with special tax breaks being used as a money maker
The law is there because the city is missing out on the tourist taxes hotels collect. Higher prices means more tax for the city, a win for everyone except the tourist. If Airbnb finds a way to pay the taxes these laws won't spread.
When everybody must be a taxi driver or run Mom's Boarding House to make ends meet, sure, the economy sucks balls. On the other hand, if you have a better idea, we're all ears.
It seems that every time we have a good example of capitalism the entrenched players come in and justify why it doesn't work. There is no way that capitalism will ever exist in it's true form because the established payers have no incentive to allow it. That's one reason but this article mentions another, subsidized housing (socialist solution that encourages lower wages).
There is no right or wrong here if the playing field would just remain constant but as soon as there is a way that the little guy can make a profit the rules change. I may be over simplifying the problem but the way I see it if rules were not written to favor one citizen over another then maybe we would see the wealth evenly distributed.
DRM? No thanks, I'll just get it somewhere else...
Using the state to fight your competition is called crony capitalism and gets more opposition from capitalists than commies.
Consistently lost in the discussion of protecting hotel trade or preserving housing stock is the negative affect Airbnb has on neighborhoods. People buy houses in residential neighborhoods to enjoy the benefits of... residential neighborhoods. Introducing an unknown, transient stream of tourists and other visitors into stable neighborhoods is generally a net-negative for the neighbors. Airbnb allows individuals to unilaterally monetize the peace and safety of their neighbors. That is the problem with Airbnb.
It is newsworthy/noteworthy that reduced competition leads to higher prices?
From what I understand, cities like NYC have very carefully-crafted laws regarding hotels designed to protect the rights and safety of both the hotelier and the guest. AirBnB wants to be exempt from all those regulations and hospitality taxes because, well, it allows them to offer a lower-cost option without any significant investment. In effect, AirBnB wants to be a hotelier that owns no hotel rooms, pays no hospitality taxes, and has no legal responsibility for anything that happens in a space they rented.
That AirBnB can't pick and choose the tax, safety, and other regulations that apply to their 'service' isn't discriminatory against AirBnB, it is treating everyone equally.
Ken
While it means you'd have to pay tax on the money you make from rentals... that's what you were supposed to be doing all along, right?
File under 'M' for 'Manic ranting'
Not sure about these other regions, but the housing situation in NYC — and that's the topic — surely is a failure. The rent-control was introduced to the city in 1943 as a temporary measure to protect families of servicemen from "greedy landlords" jacking up the prices, while the men were at war. Housing remains very expensive. Landlords wary of difficulties evicting bad tenants are very particular about who they rent to — insisting on credit-reports, income tax return-copies, and background checks.
Meanwhile, well-connected politicians — especially the "fighters for affordable housing" get such subsidized apartments for themselves — and not just one, but up to four sometimes.
Unfair, inefficient, corruption-prone — what's not to like about Statism?
In Soviet Washington the swamp drains you.
You mis-spelled "Republican", not "Muslim"
What makes you think things are worse or less fair? Obviously, any distribution of resources, compared to any other distribution is going to be good for some people and worse for others. I'll say, not only does this rule make things better for the far majority of people, it also makes things far better for the vast majority of people who can vote in NYC elections.
Winnners:
Losers:
Uncertain:
Why shouldn't a city be able to look at those tradeoffs and make a decision?
Your ad here. Ask me how!
This is actually known as "rent-seeking"; a businessman uses the power of government to attack other businesses. Because it's easier for a big business to get the government to attack small businesses (because small businesses don't have a gross of lawyers on retainer) than it is for the big business to actually do BUSINESS in an efficient way.