Airbnb accused of listing many illegal properties

Brownstone apartments, which are popular Airbnb rental options in New York.
Brownstone apartments, which are popular Airbnb rental options in New York. Photo Credit: Shutterstock

The American Hotel & Lodging Association (AH&LA) released a study on Wednesday alleging rampant illegal activity among Airbnb’s most prolific hosts and pushed further for more stringent regulations on home rentals. 

Airbnb took issue with the study, calling it “deeply flawed” and “misleading.”

The AH&LA commissioned a study by Penn State University’s School of Hospitality Management that estimated  almost 40% of Airbnb's revenue in the 12 largest U.S. metropolitan areas is generated by hosts with at least two units, and that almost 30% of revenue was generated by so-called “full-time hosts” who book units at least 360 days per year.

For the study, Penn State culled data from Airdna (a company that provides data to vacation rental entrepreneurs and investors) for the 13 months ended September 2015. The data was culled from properties in New York, Chicago, Los Angeles, Philadelphia, Miami, Houston, Dallas, Phoenix, San Antonio, San Diego, San Francisco, and Washington, D.C.  Combined, hosts in those cities who rented out entire homes generated $1.3 billion in revenue for the 13 months.

Such activity from what AH&LA termed “corporate landlords” was particularly common in Miami, where full-time hosts accounted for 61% of the city’s Airbnb revenue. In  New York, full-time hosts accounted for 24% of total revenue, 31% in Los Angeles and 22% in San Francisco.

Throughout the 12 cities, full-time hosts averaged $142,000 in revenue for the 13-month period.

“A significant and growing percentage of Airbnb’s revenue comes from those with multiple residential properties rented out on a full-time rental basis,” AH&LA CEO Katherine Lugar said in a webcast on Wednesday. “These corporate landlords dodge taxes, skirt the laws and flout safety standards.”

Airbnb faulted the study, calling it inaccurate and misleading. In New York, about 95% of Airbnb’s hosts have just one listing, while the median number of a host’s annual nights booked per year is 42, according to Airbnb spokesman Nick Papas. In San Francisco, the average Airbnb home rents out 90 nights per year, while in Los Angeles and Seattle, 80% of Airbnb listings are booked fewer than 90 days per year.

 Papas added that while the AH&LA study pegs the number of  full-time hosts within the 12 metro areas measured at almost 2,700, the true number is 17.

“This report uses misleading data to make false claims and attack middle-class families who share their homes and use the money they earn to pay the bills,” Papas said. “The overwhelming majority of Airbnb hosts are middle-class people who occasionally share only the home in which they live and while Airbnb hosts keep 97% of the price they charge for their listings, hotels take most of the money they earn out of the community.”

Regardless, AH&LA, citing the study, says multi-unit and full-time hosts are accounting for a growing percentage of Airbnb revenue and continue to operate illegally by violating short-term rental laws and either avoiding or underpaying occupancy taxes. 

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