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Is the sharing economy over already? Yes, if letting companies get their way

16 August 2016

11:04 AM

16 August 2016

11:04 AM

Sitting on the lanai (balcony) sipping a beer, the wind gently rustling through the palm trees and my Hawaiian hosts’ adorable puppy licking my toes: life was sweet.

I’d struck gold. I was living the Airbnb dream. David and Doug treated me like one of the family, complete with days out and home-cooked meals. Nothing was too much trouble. When they dropped me off at the airport (no extra charge), we vowed to be friends forever and I cried the whole flight home.

I experienced Airbnb exactly the way it was meant to be – living like a local with the locals.

But back in the UK it’s a different story. Travellers turning up in London are likely to find themselves renting a flat run by a third-party management company totally uninterested in cross-cultural connections and solely concerned with collecting the cash.

Less than a decade after Brian Chesky and Joe Gebbia supplemented their San Francisco rent by renting out an airbed in the living room, the so-called ‘sharing economy’ has, depressingly predictably, been taken over by capitalists.

A sub-industry of Airbnb management services has sprung up offering ‘hosts’ a hands-off experience. Services range from checking guests in and out and changing linen, to complete control over listings and bookings. Tellingly they all promise mega buck returns.


Take Airsorted.uk, for example. ‘Discover the Airbnb value of your property. Make More Money,’ its websites boasts, ‘Airbnb Hosts can earn 60 – 100 per cent more than renting their home residentially. We optimise the pricing to ensure maximum earnings.’

It doesn’t sound very sharing to me. Neither does rival management firm Guestbutler.com which claims to be ‘The tool that makes your Airbnb business a success’. The word ‘business’ gives the game away. No one’s sharing anything here.

Despite the Airbnb concept originally being that of occasionally letting out a spare bedroom to earn some extra income, these firms are cashing in on people letting whole properties on a short-term basis all year.

Data website InsideAirbnb analyses public listings and found that in June 2016 there were 42,646 Airbnb listings in London with just over half (51.3 per cent) of listings for entire homes.

Even more suspicious are the numerous hosts who appear to have entire empty property portfolios at their disposal. Back in March a Guardian investigation found more than a third of entire homes on Airbnb are listed by hosts with multiple listings.

Where are all these properties coming from? My guess is it’s a mixture of those owned by landlords that would normally be let to residential tenants, and pretend landlords renting property from real landlords and then subletting for a quick profit.

Either way there are undoubtedly properties rented on Airbnb that could be let to residential tenants currently struggling with high rents and limited supply.

Most rental contracts prohibit subletting but that hasn’t stopped some Airbnb pretenders blatantly encouraging tenants to join the party. ‘Long live subletting’ cries copycat site Unlease.io. which claims ‘landlords can’t de facto deny tenants permission to sublet and are not allowed to withhold consent to sublet unreasonably’.

Maybe, maybe not. But landlords can evict you with no reason so squabbling over your right to sublet is rarely advisable.

Whether keeping properties out of the long-term rental market is moral or not, homeowners using Airbnb all year are also breaking the law. Legally, homeowners can only let their property for a maximum of 90 nights a year before they require planning permission. This fact appears to be widely ignored in the short-term let industry.

But legal and moral issues aside, if large areas of cities are being taken over by tourist accommodation, Airbnb visitors will miss out on the one thing that attracted them to the concept in the first place: the chance to live like a local.

Emma Lunn is a freelance personal finance journalist


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