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Airbnb Cracks Down on Rentals in London, Amsterdam

Firm now enforces local laws, instead of fighting them

December 15, 2016 | Retail & Ecommerce | Travel

Airbnb is laying down the law in Amsterdam and London by limiting the number of days hosts can rent out their properties to guests. The move is part of an ongoing attempt by Airbnb to work with regulators across multiple cities—a change of tactic for the short-term home rental company, which had previously ignored or fought back against attempts to regulate it.

Reach of Airbnb Sites Among Internet Users in Select Countries in Europe, July 2016 (% reach)

Airbnb’s willingness to enforce cities’ laws is a new wrinkle in the sharing economy’s ongoing struggle to accommodate itself to the traditional economy.

The rules, which take effect on January 1, 2017, will ban hosts from renting their properties for more than 90 days per year in London and 60 days in Amsterdam, unless they can provide proof of permission to do so. In London, the 90-day limit has been in place since 2015 but has not been enforced. Airbnb is now planning to introduce a system that will automatically cap the number of rental nights in those two cities.

According to a press release from the firm, a typical Airbnb host in London shares their property for roughly 50 days each year, compared with 28 days for those in Amsterdam.

The move is especially significant considering that London is one of the most popular Airbnb destinations in the world. Based on company data, London has the third-highest number of Airbnb listings globally, at roughly 40,000, behind only New York (43,000) and Paris (68,000).

Due in part to its smaller population, the number of listings in Amsterdam is noticeably lower. Still, data shows that Amsterdam is an important market for Airbnb. According to comScore, the Netherlands placed second in Europe after France in terms of the number of unique desktop visitors to the platform. In July, 6.3% of internet users in the Netherlands visited Airbnb, while 7.3% visited Airbnb in France. The figure includes both accommodation bookers and providers.

In the past, Airbnb sometimes fought back against cities that have tried to regulate use of the platform.

In New York, for example, the company filed a suit challenging a law that called for fines of up to $7,500 for listing an entire property on a site like Airbnb for fewer than 30 days. Airbnb settled the suit in December, promising not to sue the city as long as New York enforces the laws against hosts and not the company.

It’s possible that Airbnb will use both Amsterdam and London as models for European cities with strong opposition to the platform. But the company is likely to have a tougher time going forward, however, as some of the other major cities on the continent have been far more stringent about its use.

In Barcelona, the government recently raised the maximum fine for renting an apartment to tourists without registering it on the city's tourism register, from €60,000 to €600,000 ($66,000 to $666,000). Berlin's government has arguably taken an even tougher stance, with hosts facing a fine of up to €100,000 for renting out more than 50% of their property on a short-term basis.

Much of the opposition toward Airbnb in Europe stems from rising property prices and a lack of available housing for residents. Critics argue that overuse of home-sharing platforms makes it harder for the city's residents to find their own affordable housing. The impact on the hotel industry is also a concern, as more visitors choose to rent a home through a platform like Airbnb rather than stay in a traditional hotel.

—Jasmine Enberg

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