Donnie Abbott, a premier international financial advisory group based in Tokyo, have today released a report highlighting the change in regulatory requirements
Online PR News – 09-November-2016 – Tokyo, Japan – Donnie Abbott, a premier international financial advisory group based in Tokyo, have today released a report highlighting the change in regulatory requirements for Airbnb as US regulators cast more attention onto the prominent home-sharing firm.
In some ways, recently passed New York regulations on Airbnb Inc. return the global company to its community roots of sharing homes.
The regulation, signed into law on Friday 21st October 2016, levies a fine of up to $7,500 US Dollars on advertising short-term rentals of less than 30 days. This means property owners can still list a room in their home, but cannot advertise entire apartments for rental.
The shared-home model is similar to Airbnb’s foundations as a community-based platform, but the problem is that the company may have moved past that narrative, according to Steven Wight, a senior portfolio manager at Donnie Abbott.
The law took effect immediately and the fine is applicable after the third violation of the law.
“Airbnb was last valued at $25.5 billion and has more than 2.5 million listings in 191 countries. The company said New York is one of its largest markets, and that ‘the vast majority’ of its hosts there share their homes,”
“Still, with the growth of the company and the large valuation, the company has taken a bigger portion of market share from hotels and thus attracted the attention of the regulators,” Mr Wright said.
“Airbnb needs to come to terms in its PR and regulatory strategy with its success,” continued Steven Wright, who is currently heading up the firm’s private client drive.
Airbnb had proposed a set of regulations ahead of the ruling that included collecting and remitting taxes from its hosts, and said it would only allow hosts to have one listing across all five boroughs in New York, where the regulations are initially enforced. The company said it would still go ahead with those policies, despite the change of law.
“A majority of New Yorkers have embraced home sharing, and we will continue to fight for a smart policy solution that works for [the] people, not the powerful,” Josh Meltzer, head of New York public policy for Airbnb, said in a statement.
In the filed suit, Airbnb argues that it is a just technology platform for the listings, and thus is not responsible for third-party listings that may or may not be violating the regulations. It adds that the regulations are vague, meaning it’s unclear if they apply to Airbnb as a company, and that banning the advertising of short-term listings violates user’s First Amendment rights.
Overall, this is a setback for Airbnb, Mr Wright said, but it’s not the end of its regulatory battle in the U.S.
“I see this as a skirmish, and there will be many more skirmishes.”
The new rules do not necessarily set a model for other cities or countries, in Steven’s view. Instead, he views this kind of regulation as being on the stricter end of the spectrum, while the model in San Francisco appears to be largely accepting of the process, even with pending regulation that would limit short-term rentals to 60 days a year.
It could slow down Airbnb’s initial public offering. But when that IPO comes, Mr Wright said he believes Airbnb will hold up to its valuation.
“I still think that Airbnb and Snapchat are going to be the big winners of the most recent unicorn rounds.”
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