Sunday, August 13, 2017

The End of AirBnB?

A new law requiring (as I read it) every person who wants to offer a room on AirBnB to register as a tourist agency is an ill-designed attempt to benefit the hotel industry by prohibiting competition.

It's understandable that hotels and hostels, which undoubtedly pay lots of taxes and suffer under reams of regulations, see AirBnB as unfair competition. But the 'sharing economy', which also includes Uber, has become a big part of our culture and economy, enabling an untold number of Colombians to earn extra income while putting a vacant room to use. As a person who runs a tourism business myself and has to pay lots of taxes and comply with often unreasonable - and sometimes impossible - laws, I can assure you that nobody will suffer thru this bureacratic nightmare just to rent an extra bedroom. Instead, if the law is enforced, it will either shut the sharing economy down (as taxis are attempting to do to Uber) or push it into illegality.

The magic of the Internet has made it possible for people with excess resource - such as an empty
Rooms for rent: Should this home's owner
have to register as a tourism agency?
room or apartment - to hook up with others seeking that resource, such as travelers. In the Internet ages, this is not likely to go away, no matter what hoteliers and taxi drivers may wish. By banning AirBnB, Colombia would hurt itself by turning away travelers who don't like staying in hotels. Those people will instead go to Argentina, Mexico or some other jurisdiction which does permit room sharing, and Colombian travel agencies, handicraft makers, restaurants and bus companies will all lose out for the sake of defending the hotels' obsolete monopoly.

This is all particularly true of a nation like Colombia which is just establishing itself as a tourist destination. Eliminating a whole category of lodging won't help its case.

AirBnB-type services creat real concerns, such as a neighborhood losing its character, or becoming unaffordable to its traditional residents, altho these things can happen anyway. Ways to handle these concerns are to limit the number of days per year which a property can be rented out, or prohibiting an individual from renting out multiple properties. And taxes can much more easily be collected from the company than from each individjal property owner.

By Mike Ceaser, of Bogotá Bike Tours


Stuart Oswald said...

Competition is a great thing and something that all markets need. Governments best serve the people by staying the hell away from their business. Airbnb, however, is a disgracefully politicised organisation that really needs better competition itself. I for one would never use them due to their infringements on the rights of Christians and peoples right to free speech.

Miguel said...

AirBnB is a great example of new competition and new options for consumers. My brother and his family recently stayed in AirBnBs in Europe and loved it. They felt more like residents than tourists.

I agree that AirBnB's market dominance is worrying - as is Uber's, Amazon's, Microsoft's, etc.

I'm not sure what you mean about their 'infringements' on free speech rights. Do you mean landlords' rights to exclude cerain categories of people, such as gay couples from their rooms? I'm surprised Oswald! I thought that you'd be the first to assert the rights of businesses to operate the way they want, and express themselves as they like.