What San Francisco Renters Should Know About AirBnB
Ask a Tenants Right’s Lawyer is your chance to learn how to survive as a renter in San Francisco. Attorney Daniel Wayne has the information you need to keep you in your home. This month’s topic: the state of airbnb and short term rentals in San Francisco. Got a question? Send an email to alex@brokeassstuart.com and we will forward it on.
AirBnB, the SF-based home-sharing site privately valued at a whopping $38 billion, isn’t universally beloved in its hometown. In fact, activists and local governments here in the Bay Area have been battling the rise of short-term rentals for well over five years. Local legislators (and most of us tenant lawyers) argue that AirBnB has exacerbated our housing crisis, making it harder for renters to find a home. Long-term tenants might feel effects, too, as data compiled by the Anti-Eviction Mapping Project indicate a connection between short-term rentals and eviction rates.
In cities all over the world, economists, social scientists, and housing activists have found that so-called home-sharing sites make homes more expensive for the rest of us. Short-term rentals cause units to be taken off the rental market, leading to tighter housing supplies as former homes are converted to de facto hotels. Researchers have found that the rise of AirBnB caused every single New Yorker’s rent to increase by an average of $400 per year. That’s a pretty significant effect for a single company to have on the housing market. What’s more, AirBnB can have devastating effects on individual neighborhoods, as long-term residents are replaced by “a revolving door of strangers.”
What’s the state of AirBnB in San Francisco today? Here are the laws as they currently stand.
San Francisco’s Current Short-Term Rental Restrictions
All rentals for terms under thirty days are overseen by the Office of Short-Term Rentals and governed by fairly strict regulations. All hosts must register as a business with the city’s tax collector and short-term rental office. Hosts must pay taxes like any other business, including a 14% hotel tax that they collect from their guests.
Furthermore, all hosts must be permanent residents of the unit they rent out. So no absentee landlords here. Whether they’re renting out the entire home or just a room, all hosts have to spend at least 275 nights per year in the rented unit.
“Unhosted rentals” — that is, the rental of an entire unit, versus an individual room or suite within an apartment or house — are more tightly regulated. Unhosted rentals are limited to a maximum of ninety nights per year, per host.
How are the Laws Enforced?
Until as recently as 2018, San Francisco’s AirBnB regulations were generally considered toothless. The city placed limitations and tried to collect taxes, but AirBnB and other hosting companies shielded their data from the city and flouted all attempts at regulation.
Things changed a bit in early 2018. In response to the city’s demands, home-sharing companies purged all unregistered San Francisco hosts from their sites. As a result, the number of listings fell by more than half. On AirBnB, short-term listings fell from nearly 9,000 in August 2017 to just over 4,000 in February 2018.
Now, all short-term rentals advertised online must include their city registration number with their listing. That helps the city verify that all hosts are actual residents of the units they rent out, and that they’re not exceeding annual limits on short-term rentals. Hosting platforms are also now required to verify their users are properly registered and collecting taxes.
Finally, neighbors or others who suspect an AirBnB is operating illegally can file a complaint with the city.
Are the Regulations Working?
What has the effect of these new regulations been? Housing markets are incredibly complicated, so it will likely take years — and a lot of research — to say with any certainty whether the city’s new regulations have helped stabilize rental prices or keep tenants in their homes.
One thing we know for sure? There are still an awful lot of San Francisco units listed on AirBnB. While the number of listings dropped off to around 4,000 in February 2018, they’ve been climbing back up ever since. The data-visualization site Inside AirBnB currently estimates there are 7,000 active listings in San Francisco alone.
Further, Inside AirBnB’s data suggest that many of those listings may be breaking the law. Inside AirBnB estimates that the average unit is rented for 153 nights per year — well in excess of the city’s 90-day limitation.
Inside AirBnB heat map
What’s Next?
It’s no accident that current information on AirBnB’s rental rates must be cobbled together by activists and ordinary folks working with groups like Inside AirBnB and the Anti-Eviction Mapping Project.
Short-term rental websites have had a huge impact on local housing markets — and yet they still refuse to allow city or state regulators access to their enormous stores of data. This means the city still has to rely on self-reporting by the hosts and platforms to make sure they’re following the law.
At every step of the way, and in every city and country, AirBnB especially has done its utmost to avoid transparency and openness, engaging in what a journalist has called a “guerilla war” against city governments.
With extremely tight housing markets in San Francisco and the Bay, even a small number of apartments and individual rooms given up to the short-term rental market may make life more difficult — and expensive — for residents. Whether San Francisco’s next steps involve tighter regulations, or better enforcement of existing rules, there’s no doubt the city will continue to struggle with short-term rental platforms.
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