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Airbn-bye: curbing the shared economy during a housing crisis

On Thursday the 25th of October, Minister for Housing Eoghan Murphy announced plans for a new set of regulations designed to curb short-term lettings through platforms like Airbnb. The regulations, which are due to come into force in June 2019, will aim to free-up properties for long-term renting and therefore help to alleviate Ireland’s long-running housing shortage.

A “one host, one home” model will be introduced, which will allow homeowners to let out a room in their primary residence for up to 14 days at a time, subject to an annual maximum of 90 days. This will effectively prevent persons from purchasing second homes for the specific purpose of renting them out year-round on Airbnb.

According to the new proposals, second homes may only be rented out on a short-term basis on Airbnb’s platform where permission has been successfully sought from local planning authorities, or where the property is already recognised as a tourist facility.

In their short ten-year history, Airbnb have become stalwarts of the shared economy along with Deliveroo and global ride-sharing behemoth, Uber. The short-term letting specialists have voiced their dissatisfaction with the proposed new regime, referring to Minister Murphy’s regulations as a “cut and paste job” from other jurisdictions.

The City Council of Toronto did indeed introduce very similar measures in December 2017 which allowed short-term letting of primary residences for periods of up to 28 days, subject to an annual maximum of 180 days. These rules also provide that homeowners must pay a fee and obtain a licence prior to advertising their property on Airbnb.

Paris remains the most popular Airbnb destination in the world with over 60,000 units on the platform. In 2015, Mayor Anne Hidalgo spearheaded a crackdown against secondary apartments being used as short-term rental units. Fines of up to €25k can be levied against those who violate this policy.

Hosts in the Greater London area can receive bookings for up to 90 days per calendar year, with Airbnb themselves blocking any attempts to go beyond this. Over 4.6m overnight stays were logged with the service in 2017, representing an increase of 130% on the same figures from 2015 according to a study conducted by property services company, Colliers.

Between November 2016 and November 2017, roughly 1.2m people travelled using Airbnb in Ireland, choosing from a combined portfolio of some 22,800 properties. A report released by Airbnb themselves estimates a net contribution of €506m to the Irish economy from increased tourism.

Airbnb claims that the majority of this goes to local bars, restaurants and supermarkets in lesser-spotted areas which were previously inaccessible to tourists. According to figures provided by the company, Irish hosts can expect to earn around €3500 per annum – an amount they are quick to point out is equivalent to a family holiday.

Minister Murphy’s proposed regulations represent the latest turn in a series of clampdowns by Irish authorities on the “shared economy”. In late 2017, the National Transport Authority decided to completely ban Uber from operating a pilot scheme in Limerick – citing the company’s incompatibility with the needs of the Irish economy.

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