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Should Airbnb be allowed to continue operations in New York and San Francisco?

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Courchevel/Airbnb
The only thing more polarizing than Airbnb’s new logo (seriously, what is that thing?) are the company’s practices as they affect the already sky-high prices of real estate in cities like New York and San Francisco. On Tuesday, the New York Times allowed a series of conflicting opinions to play out across their opinion pages as various experts weighed in on the company’s morality in terms of the ongoing housing crisis.

A line in the sand has been drawn — on the one hand, critics say that Airbnb makes worse the skew in supply and demand for housing in high-density, expensive locations, turning would-be available units into hotels for hire. Chris Estes, the president and chief executive officer of the National Housing Conference, wrote for the Times, “Fundamentally, our rental affordability crisis is a supply problem. We’re simply not building enough rental housing to meet demand, particularly in job centers, and especially for low- and middle-wage workers. Taking rentals off the market only makes a bad situation worse … Limits on Airbnb rentals could help some.”

But on the other hand, proponents and defenders of Airbnb note that the company allows for cash-strapped city inhabitants to make a little bit of extra side-income, and is no different in many ways than subletting, a common practice in all big cities. Wrote Arun Sundararajan, a professor at the Stern School of Business at New York University, “Airbnb has helped create a new form of mixed-use real estate: residential units that sometimes double as short-term paid accommodation.”

And whereas calls for regulation have rung out across the board, Sundararajan and other contributors to the conversation argued that this would not provide an overall solution. He noted that, “Regulation of Airbnb cannot by itself solve San Francisco’s housing shortage, whatever form the regulation might take. It is critical that city governments treat platforms like Airbnb as partners in finding new regulatory solutions, rather than casting them as the protagonists in conflicts between existing regulations and the new commercial behaviors they enable.”

Still, says Nicole Gelinas, a Manhattan Institute’s City Journal contributing editor, there needs to be significant oversight when it comes to who’s renting out what. She pointed out, “In a three-year study published last year, New York State Attorney General Eric Schneiderman found that 72 percent of Airbnb listings are for illegal rentals. Don’t blame Airbnb for blurring the legal distinction between apartments and hotels. Blame state and local politicians who let it.”

Ultimately, says Sarah Watson, the deputy director of New York’s Citizens Housing and Planning Council, the chief focus should be on the well-being of city inhabitants. “The goal of these cities,” Watson penned, “should be to make sure that residential units are not being taken off the market in areas where demand for housing is already far outpacing supply. In those areas, they should focus on allowing and encouraging roommate sharing. Extra housing space is more important for city residents than for tourists.”

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