
Airbnb host ordered to pay £100k of unlawful profits after letting council flat - dustinmoris
https://www.bbc.co.uk/news/technology-49149983
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Sholmesy
I live in a building in Central London (Soho) that has 12 flats. We pay market
rate for ours, that is supposed to help the housing association offset the
cost of some of the other flats that are designated as social housing.

Most of these flats are just constantly churning Airbnb guests in and out,
some of the others have lodgers (also illegal, friend of mine lived in one of
them, hence why I know).

I don't know what to do with this information, but its such a shame that
people are so comfortably scamming the government, when it's literally funded
by all of us.

EDIT: per the responses, I have called the council and they were very
keen/interested. Thanks for your input.

~~~
vidarh
Westminster council has a form to report potentially unauthorised short term
letting:

[https://www.westminster.gov.uk/nightly-letting-complaints-
fo...](https://www.westminster.gov.uk/nightly-letting-complaints-form)

(It's not specific to council housing; if it's specifically council housing as
opposed to the developer just agreeing to let it at a reduced rate, then
they'll take an even dimmer view on it; if it's the developer or some
management company then it's worth contacting them _as well_ as it may impact
their insurance etc.)

~~~
Sholmesy
Right, I "know" what to do; but I don't know if it's "right" for me to get
involved. Appreciate the link; I'll report it tonight.

~~~
chii
Yes, it is right. Nobody should privately profit like this from socially
funded housing.

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FrozenTuna
I love AirBnB on paper, but in practice, its just too ripe with issues. So
many similarities to Uber too. Socialize the costs, privatize the revenue. Use
litigation to fight to keep the loopholes open. At least Uber isn't screwing
with the housing market, that I know of.

~~~
AJ007
I think ultimately it is up to regulators to determine how to deal with these
companies / platforms. They are legal entities and can be targeted, unlike
open source software projects and protocols.

I can add a lot of opinions as to if these companies are a net positive or
negative, but overall the regulators have a disproportionate amount of
firepower compared to these companies. Airbnb first time offense for Miami
Beach is $20,000 and doubles after that. All of these companies know that, and
it is why they so aggressively fight the regulatory side.

Uber certainly got a lot of tailwinds due to regulatory capture backlash from
local cab companies. Airbnb, to some extent because of dislike or outright
unavailability of hotels. Some markets were much healthier and well regulated
than others pre-Uber/ Airbnb. Some hotel/transport markets were a disaster.

In summary, if the regulatory frameworks are crafted in the right way, for
whatever the given market is, everyone is better off save for previously well
entrenched business. I’m not sure there is actually enough talent, globally,
to accomplish that on a individual local market level.

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rthrowayay
I think there is a strong temptation for this when there is a large gap
between the value of the social housing to the occupant and the value of the
social housing on the market.

This flat is in Victoria which is quite central in London. I would expect you
could provide more social housing at the same cost in some of the outer zones.
There is obviously a trade off where the increased amount of housing from
going further out is not worth the inconvenience to the occupants. However, I
would expect this trade off kicks in well outside of zone 1.

For the sake of argument let's assume you could double the zone 1 social
housing by moving it to zone 2/3\. That seems like a pretty big failure in
policy.

~~~
dustinmoris
Some of the most expensive places in London are outside Zone 1 (Hampstead,
Richmond, Kensington, West Brompton, Wimbledon, etc.). Also creating a high
density of social housing aka ghettos is not desirable for any city in the
world and those who have it have big problems because of it. London has huge
inequality problems, but the fact that you can have a millionaires road only 5
minutes away from a council estate has the advantage that social issues are
not just being ignored and brushed under the carpet by forcing people as far
away as possible, it creates more diverse and accepting communities, it
ensures that people from all different fortunes have access to nice parks,
good transport links (which are even more important for people who are on low
income), etc.

~~~
systemtest
I don't think it is very nice to make the assumption that a high density of
social housing will result in a ghetto. Do you have sources that people in
social housing are more prone to violence and crime?

~~~
karmakaze
It's neither an assumption nor about being nice. As mentioned isolated dense
social housing has been observed to create conditions that alternate plans can
counter. It also doesn't have to be about violence or crime--mere the neglect
of neighbourhoods that are not 'in mind' of decision makers for simple things
like maintenance of roads, lights, etc all contribute to this.

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crispyporkbites
For those who aren't from the UK, a council flat is an apartment owned by the
local government, with subsidized or free rent for people who can't afford to
rent in the area. Residents are means tested (i.e. availability is based on
income / special situations). People at considerable risk on the streets tend
to be prioritised in the waiting list (families, single women).

This man was eligible, lived in the apartment at some point, but took £110 a
night from airbnb guests and lived elsewhere when guests stayed.

Sub-letting council flats is illegal, but pretty common as it's basically
impossible to stop on a cash in hand basis. However, a platform like AirBnB
could easily block this activity from happening on their platform, if they
wanted to.

------
parthdesai
> "We regularly remind hosts to check and follow local rules - including on
> subsidised housing - and we take action on issues brought to our attention,"
> said a spokeswoman.

Bull fucking shit.

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baq
need this in my city, there are whole neighborhoods being built that are
hotels in everything but name driving rent and flat prices sky high and making
the whole local housing market inaffordable for normal people.

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crispyporkbites
Shouldn't Airbnb also pay back all of the fees they charged for this?

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lawnchair_larry
What does “letting council flat” mean in US english?

~~~
Sholmesy
Council flats are like "government subsidized living". Letting it out (aka
renting it out), is taking money from the government, intended to help you
shelter your family, and using it to turn a profit.

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p_roz
Build more housing capacity. An increased supply of housing could support both
long term housing and legal Airbnb rentals.

Because of static supply, the two use cases are competing in a zero sum way,
but that needn’t be the case.

~~~
vidarh
In this case the issue was outright fraud: They got a council flat that is
meant to provide subsidized housing for people who generally can not afford
private housing, and profited from it against the terms of his rental
agreement.

But in the general case, I keep arguing the same. In the UK there's a very
strong trend to focus on landlords and foreign buyers leaving housing empty,
or cases like in this article, but when you dig into it, it makes up a tiny
proportion of properties.

The government has contributed to pushing the focus to these types of things,
even though e.g. _all_ empty properties in the UK being filled would maybe
cover ~6 months of demand (and you can't fill all of them - most are empty for
things like refurbishments or during a sale; very few are left intentionally
empty for long periods of time). I doubt AirBnB demand would add up to more
than a rounding error either. But it's a convenient excuse, and much cheaper
than to drive higher growth in construction.

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pessimizer
Or less interestingly, Airbnb host who made £100K letting council flat fined
£100K for letting council flat, an amount determined by how much profit the
host made.

~~~
dustinmoris
> "Anti-fraud software had found Harman's first name in reviews and connected
> the listing to him."

Pretty interesting to me...

> "It's illegal for council tenants to sublet their homes and we carry out
> tenancy checks, as well as monitoring short-term letting websites for any
> potential illegal sublets."

Also pretty interesting to me... it's nice to see that the councils in London
are using their own technological advances to fight illegal activity like
this!

~~~
iratewizard
And it's lucky that they've now paid off a tenth of the cost of developing the
software.

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swiley
I’ve never quite understood why subletting is illigal in places like this.

Person A needs money because rent is high, person B needs housing because
housing is scarce, A rents B their couch and everyone is happy.

Obviously that’s a little different than just sticking the whole thing on
Airbnb, but it looks to me like it’s legally considered the same when it
really shouldn’t be.

~~~
DougN7
If A is getting subsidized housing they’re earning taking others’ taxes and
profiting from it. I’d say they’re not entitled to the subsidy in that case.

~~~
swiley
I get what you’re saying but I’m still not convinced it totally makes sense.

The goal of subsidized housing is to make housing more affordable for some
group of people, subletting likely has the same effect so the money
subsidizing the building is still going to the same thing.

~~~
vorpalhex
You're running a business with somebodies charity - that's a no go. If I give
you $50 to buy food and you run a lemonade stand with $25 of it, then you've
abused my charity.

Now, it might be that I shouldn't have given you the $50, or that we should
have discussed giving you a business loan instead - those things are fine.
There's nothing fundamentally bad about running a lemonade stand. You simply
can't run a lemonade stand with charity earmarked for not-lemonade-stands.

