
Airbnb and San Francisco - betadreamer
http://blog.samaltman.com/airbnb-and-san-francisco
======
callmeed
_" Unfortunately, a lot of other people have problems paying their rent or
mortgage. 75% of Airbnb hosts in San Francisco say that their income from
Airbnb helps them stay in their homes, and 60% of the Airbnb income goes to
rent/mortgage and other housing expenses."_

C'mon Sam, you can do better than this. Just about everyone's income helps
them pay their rent or mortgage regardless of where it comes from. And let's
not pretend (a) parkinson's law doesn't exist or (b) people allocate specific
income sources to specific expenses. If you make more, you spend more. If you
have to pay your rent on the 1st, you write a check from your bank account–you
don't pull cash out of your "AirBnB income" envelope.

And, BTW, I've never rented an AirBnB in SF who wasn't (a) a young
professional that could afford to live there or (b) someone 40+ who clearly
had lived in SF a long time and bought prior to the spike in prices. These
statistics and stance just don't compute for me.

Look, I love AirBnB and I think it's a great service. But it's just that–the
best short-term/vacation rental service. Nothing more. I'm a little tired of
them (and their apologists) acting like they're some kind of cultural
juggernaut.

I always knew they'd have huge political forces to answer to (my friends and I
would often wager who was more likely to succumb to governments: Uber or
AirBnB). They're going to have enforce bed taxes. They're going to have to
police municipal laws, HOA regulations, and more. And after it all shakes out,
maybe this isn't as profitable of a business as people thought (for both
AirBnB and hosts).

Of course, like Uber, they'll likely take the lobbyist route to fight this
(maybe they already have). But this is a case where a little humility would go
a long way IMO. Would it be so hard for AirBnB or Sam to say "yeah, there's a
housing issue and we might even be part of the cause. so let's work together
to find a solution or compromise."?

~~~
sama
I'm not arguing that people allocate specific income to specific expenses,
just that people need and deserve more income.

I think Airbnb is well aware of the housing issue and more than willing to
work together on solutions.

~~~
justizin
> I think Airbnb is well aware of the housing issue and more than willing to
> work together on solutions.

I'm sorry, that's just not true, and Sam, I admire a lot of what you've said
on a lot of issues, but I cannot believe that you are sincere in this article
overall, unless you are just naive.

Any property owner in San Francisco has always been able to go to the Planning
Commission and request a conditional use permit to turn their home into a bed
and breakfast, and as far as we can tell, no such request has ever been
denied.

Renters in San Francisco do not in almost any case I have ever heard of have
the right to sublet our apartments, even to additional roommates, without the
approval of our landlords, and with good reason.

If a person has lived in San Francisco for some time, and loses their ability
to earn enough to pay their rent, it is abusive and narcissistic for that
person to believe that simply by having the keys to a place that already does
not belong to them, they can - with no consideration for their neighbors -
turn their home into a business. A hotel business, no less, which _kind_ of
foists upon them the responsibilities of travel guides, as we read in an
article this morning.

Now, as demand for housing in an area is shooting up, individual renters are
leveraging that in a way that does not contribute to the cost of maintaining
property, putting increased pressure on other tenants, and disallowing the
landlord from actually satisfying that demand.

All that aside, AirBnb knows what the fuck they are doing. I know at least one
successful AirBnb host who has had AirBnb approach them and encourage them to
rent up nearby apartments and turn them into new units!

San Francisco housing activists have asked time and time again for AirBnb to
open up data about how many hosts have multiple units, and who is renting when
not in their unit, so that data may be used over time to guide regulation, but
as is becoming a trend with YC companies, private executives and investors
feel that they can do better city planning than people who have decades or
perhaps their entire lives invested in doing so.

Put up or shut the fuck up, sir.

~~~
mildbow
"It is difficult to get a man to understand something, when his salary depends
on his not understanding it."

\-- Upton Sinclair iirc

~~~
cwilkes
Not sure who is downvoting you -- this quote is entirely appropriate.

------
pbreit
I have trouble feeling sorry for AirBnB with this. It has had numerous
opportunities to put forth a reasonable view on how this should all work and
AFAICT, has not.

First, most (all?) HOAs and landlords forbid short term rentals, and for good
reason (short term renting is generally disliked by neighbors).

Second, city zoning policies are implemented for a reason, again, a good one.
Residential neighborhoods generally prefer little or no commercial activity as
well as inhabitants who care about the neighborhood.

I have not seen AirBnB weigh in reasonably on these important issues. For
that, it's possible it deserves Prop F.

~~~
seiji
Yeah, saying airbnb is good for housing prices is like the people who think a
universal income will help people live easier. hint: if you give everyone an
extra $20k/year, housing will magically go up by $20k/year to match.

with airbnb, if you can't afford your $3,000/month rent so you take in a share
tenant, maybe now you can afford $5,000 month in rent. now housing prices know
everybody can make $5k/month appear through tenant-izing, so all prices go up.
now nobody can afford a place unless they take in co-habitating renters or are
DINKs.

~~~
acgourley
It's not magic, it's economics. There are frameworks to think and model this,
and they do not support your conclusions.

~~~
seiji
but does your model take into account ė, the derivative of evil in the hearts
of humans with respect to time?

~~~
acgourley
Yes.

------
jdp23
> In the past year, only about 340 units in SF were rented on Airbnb more than
> 211 nights ...

For the purposes of Prop F, statistics that seem more relevant are

\- how many units are rented more than 90 nights (the current law) [1]

\- how many units are rented more than 75 nights (as proposed by Prop F)

When I see AirBnB supporters focusing on a number that doesn't seems as
relevant, it feels like spin to me.

> The median number of trips per unit was 5, and mean was 13.3.

Interesting shift here to talking about trips per unit, rather than nights per
unit. Back in 2012, the average stay was 5.5 days [2]. So does that mean that
the average number of days per unit is 71.5 (5.5 * 13)?

Also, according to the Chronicle [3], out of the 5,459 listings in 2015, "205
hosts have three or more listings. These super hosts account for 4.8 percent
of all hosts, but control 993 properties — 18.2 percent of Airbnb’s local
listings." I didn't see anything in Sam's post or the other anti-Prop F posts
that discusses this.

[1] [http://www.cnet.com/news/san-francisco-board-of-
supervisors-...](http://www.cnet.com/news/san-francisco-board-of-supervisors-
vote-on-airbnb/)

[2] [http://blog.airbnb.com/economic-impact-
airbnb/](http://blog.airbnb.com/economic-impact-airbnb/)

[3] [http://www.sfchronicle.com/airbnb-impact-san-
francisco-2015/...](http://www.sfchronicle.com/airbnb-impact-san-
francisco-2015/#1)

~~~
chralieboy
The 211 number was given as what Airbnb has found to be what it takes to break
even on the cost of a unit. Prop F, and others like it, are not trying to
destroy Airbnb but stop people from purchasing housing and using it
exclusively for short term rentals.

That statistic is meant to say that only 340 units were rented out enough to
match what could have been made via a lease. So if people are snatching up
property to use just for Airbnb, they either aren't doing it a lot or aren't
actually making a sound economic decision in all but 340 cases.

~~~
jdp23
I understand what the statistic is meant to say and it does that well.

However, the city's already limited units to 90 days, so the 211ers are
already handled -- if the city (with AirBnB's cooperation) enforces the law,
that is. So I don't this point isn't particularly relevant to Prop F. Your
mileage may vary, of course!

------
applecore
_> Airbnb has recently been attacked by San Francisco politicians for driving
up the price of housing in the city._

The high price of housing in San Francisco is caused by one (and only one)
thing: NIMBYism.

If supply is constrained and new high-rise developments are held back, there
will always be higher prices and a distorted market.

In reality, Airbnb doesn't have any measurable effect on the price of housing.
(Still, it may help alleviate the situation slightly for some people living in
the city.)

~~~
pbreit
Except that lack of high density is one of the City's more appealing
attributes. I don't like the simple call for more housing without any
acknowledgement of the consequences.

~~~
harryh
A CAP theorem for bay area housing policy: Charming, Affordable, Popular. Pick
two. And, like Partition Tolerance, you can't drop Popular.

~~~
Futurebot
That's a great way to think about it. You can drop popular (eventually it gets
to expensive that you reach a new equilibrium and people stop coming!), but
it's hard to say at what point in the future that actually happens.

~~~
harryh
Nobody goes there anymore. It's too crowded.

------
flyinglizard
_> Unfortunately, a lot of other people have problems paying their rent or
mortgage. 75% of Airbnb hosts in San Francisco say that their income from
Airbnb helps them stay in their homes, and 60% of the Airbnb income goes to
rent/mortgage and other housing expenses. Making it harder to share your home
in San Francisco may make it impossible for some of these hosts to afford to
stay in their homes and in this city._

This is why Airbnb helps maintain untenable pricing levels. There's more money
to go around and rates can keep going up with no bearing on vacancies.

A rental management company with 20% vacancies wouldn't be so quick to raise
prices; but, as long as the tenants magically come up with ways of catching up
with increased prices, the prices will continue going up.

~~~
sama
Do you have evidence of Airbnb driving up pricing levels? I'd honestly love to
see it if so.

~~~
ChicagoBoy11
Is it necessary?

Isn't it impossible for AirBnB not to either drive up price levels or drive
down availability?

If you have a property, AirBnB immediately makes it more valuable, as it is
now possible to generate a (reasonably) passive income from it - you can use
it more efficiently than before. If you own a home or rent.

What economics are you using in which it doesn't immediately follow that this
would eventually reflect in the rental/purchase price of housing units?

Ahh "rent control and regs" you say! Ok fine, then the market tries to reach
its equilibrium on quantity and fewer units are available. AirBnB makes
housing more valuable, and if there is any vestige of market forces in SF
housing, its effect on price/supply is unambiguous.

This DOES NOT, however, mean that AirBnB is a bad thing. I firmly believe it
is an incredibly beneficial thing for everyone and it boggles my mind how
people can be so against a service whose only function is to allow us to use
our resources more efficiently. If this energy were instead spent on analyzing
all the distortions that our wonderful political system has introduced in the
system, we'd be much better off.

------
rubicon33
Am I the only one who is furious about the cost of housing in SF, and the
apparent lack of action by city government? It was my dream to live in SF
since I was a young kid. Unfortunately, the average working professional
cannot possibly afford to buy a home. Finding affordable rentals, is not an
option either.

How much longer will the professional, middle class populous, put up with
their savings being drained by over inflated housing costs? Sadly, it seems
far too many people see SF as a professional vacation place, and not a home.
When I moved there for work, I also moved there to live. I wanted to do so in
a sustainable way, which means saving money every month for retirement, and
possibly buying a home. That's a pipe dream in SF, even with a nationally
competitive salary.

I cannot figure out whether there is blatant city corruption, or a complete
lack-of-caring about the middle class. Or is it that there aren't enough
developers trying to develop?

~~~
MBlume
Two organizations working to solve the problem:

San Francisco Bay Area Renters Federation (yes, the acronym is unfortunate):
[http://www.sfbarf.org/](http://www.sfbarf.org/)

San Francisco Housing Action Coalition:
[http://www.sfhac.org/](http://www.sfhac.org/)

Both will notify you when there are city meetings coming up where you could
show up and inject some sanity into the proceedings.

~~~
rubicon33
I really wish I'd known about these organizations before I moved. Shame on me,
for not getting involved.

Thanks for the links.

------
7Figures2Commas
> In fact, Airbnb worked with economist Tom Davidoff of the University of
> British Columbia and found that Airbnb has affected the price of housing in
> SF by less than 1% either up or down.

Airbnb _commissioned_ this economist[1]. That doesn't necessarily mean his
conclusions aren't credible, but commissioned research that supports the
agenda of the company that commissioned it should be subject to a higher level
of scrutiny. Is there any independent research Altman can cite?

> Unfortunately, a lot of other people have problems paying their rent or
> mortgage. 75% of Airbnb hosts in San Francisco say that their income from
> Airbnb helps them stay in their homes, and 60% of the Airbnb income goes to
> rent/mortgage and other housing expenses. Making it harder to share your
> home in San Francisco may make it impossible for some of these hosts to
> afford to stay in their homes and in this city.

What about their neighbors? If I'm paying good money to rent an apartment or I
shell out big bucks for a new condo, why should I be forced to live in a
hotel-like environment because a neighbor decides to violate the lease or
association CC&Rs/bylaws?

It doesn't matter how well-intentioned a host is. It's callous to have
sympathy for hosts who are violating leases and condo association association
CC&Rs/bylaws and no sympathy for the neighbors their selfish behavior
negatively affects.

[1] [http://blogs.wsj.com/developments/2015/03/30/airbnb-
pushes-u...](http://blogs.wsj.com/developments/2015/03/30/airbnb-pushes-up-
apartment-rents-slightly-study-says/?mod=WSJBlog)

------
hiou
_> The mean revenue per host was about $13,000 per year_

Otherwise known as the income that one would have previously obtained by
renting a room to a permanent resident. The big difference with Airbnb is that
the service is removing potential rooms and roommate situations from the
market. I'm not going to say whether Airbnb is a good thing as honestly I'm
leaning toward it being a net benefit. But to say it has not made finding a
place to live permanently in places like SF and NYC more difficult for 1st
time and early in life renters is difficult for me to agree with.

All progress has a price. And often that price is worth the benefit. But let's
not pretend there are not people out there that will be worse off in the short
term.

~~~
kelnos
_Otherwise known as the income that one would have previously obtained by
renting a room to a permanent resident._

Not true. If I want to rent my place out for a week while I'm out of town,
that would be income that could never be provided by a permanent resident. If
I rent out a spare room to someone in town for the weekend, that's not a
permanent resident. Maybe I don't _want_ a permanent roommate, but just want
some supplementary income here and there.

You're certainly welcome to argue that I shouldn't be allowed to do that, but
I'd disagree with that point of view, and that has nothing to do with whether
or not a permanent resident could be served by the space.

------
webmasterraj
This atrocious bill is yet another example of how the biggest unicorns are
facing a kind of challenge they aren't built to solve: the political one.

Until now, the rise and of tech companies has been determined by the double-
edged blad of innovation. Someone makes something new that works better, gets
big, and then someone else makes something newer and displaces them. Repeat
cycle over and over. It's why in tech, we specialize in the art and business
of innovation.

What we don't know how to do is navigate murky political waters. We're really,
really bad at it. Can you imagine another $10BN company even letting this kind
of bill happen, that would kill their largest market if it passed?

Airbnb isn't alone. Uber hired Obama's campaign manager because they realized
they're biggest existential threat is a political one too. But see their
ongoing lawsuits and outright bans in other countries – they haven't figured
how to solve the political question either.

Meanwhile, car companies with a lower market cap, like GM, could figure out
how to get a bailout from the government – right after it bailed out another
huge industry, banks.

Those guys are just better at it. They have been for a long time. They get
things like "don't optimize to something that solves problems. Optimize
optics." Or that real deals get done behind closed doors, because you can
control what happens there. That by the time it becomes a public debate,
you've already lost the game.

We in tech have a disgust for politics. Rightfully so. It's useless at best
and harmful more often. It doesn't follow the clear, hard and fast rules that
the rest of tech does. But if we don't hold our nose and figure out how to
play the game, or better yet, reinvent it, we'll get outplayed on the biggest
board of them all.

~~~
JonFish85
"a kind of challenge they aren't built to solve: the political one."

And yet these are the battles that "technology" companies like Uber and Airbnb
had to know were coming. At best, they live in a legal gray area. You can't
start a company skirting existing laws and expect politicians to look the
other way.

And it's not just politicians that are responsible for this. As a condo owner,
I specifically don't want Airbnb to be available in my association. There are
reasons that there are laws against leasing and subleasing apartments, and
it's not just to screw over startups.

Uber and Airbnb grew to huge valuations on the back of pushing externalities
onto others. Airbnb is taking their cut and looking the other way on things
like taxes, zoning regulations and such until they are forced to deal with it.
Uber pushes similar things off onto their "contractors".

Now the political environment is catching up to them, and it's time to deal
with the same legal environment that every other company has to deal with.

~~~
meatysnapper
Strongly agreed. If you are running an 1) illegal cab company or 2) illegal
hotel company, you have to expect this. At a certain scale you are tolerated,
but when you are a major player you will get some scrutiny that cannot just be
"disrupted" away.

------
pyrophane
New Yorker here. Short-term rentals and Airbnb in particular have had a
noticeable negative impact on my downtown Manhattan neighborhood, although I'm
not talking about rent. Everyone I know now has stories about "guests" who let
anyone and everyone into the building, damage common areas, and make noise all
night long, because really, what do they care? They are on vacation. They are
here to party, and then they are gone forever.

Apartments are designed for long-term residents. Why should we even consider
allowing them to become budget hotels?

~~~
Futurebot
Same here. Life-long native New Yorker, and I've never seen anything like it.
My building has many AirBnB guests (my floor alone has 2 apartments that have
different guests all the time.) Overall it doesn't impact my personal
experience, since the neighborhood I live in is fairly noisy already (LES) and
I don't really care unless they blast music.

That all said, I think there are things that AirBnB can do to mitigate all
this: standards enforcement division. A 24-hour service where you call them
up, make your complaint, and they send over some big scary people to knock on
the offender's door and ask them to "turn it down" or "pick up their garbage."
Local government offices and the landlords themselves can't respond quickly
enough (the former can't/won't send someone there at 2AM and it'd be pretty
tough to get the latter to run over to your apartment for this sort of thing.)
Basically AirBnB police. There are steps that can be taken that don't involve
the local government or housing authority; I think AirBnB would be wise to
take them.

------
physcab
SF absolutely needs to build more housing. SF also needs to build taller (more
skyscrapers).

I have trouble believing AirBnB helps SF. Anecdotally, I know a few people who
rent their places on AirBnB. All live in rent controlled units and effectively
re-rent at market rates. One actually reduced hours at his job because income
from AirBnB was so lucrative.

------
beatpanda
Sam, your post doesnt at all address the problem policymakers are trying to
solve, which is landlords evicting tenants and then converting those units to
short term rentals. I agree that Prop F is a bad way to fix that bad behavior,
but its also disingenuous to not talk about the problem. I don't think anybody
can make a coherent argument that renting out a spare room is driving up
prices. What does do that is landlords deciding they would rather be in the
hotel business.

~~~
geebee
Airbnb could very well drive up "spare room" prices. For instance, think about
a room in a house, or may be a small in-law, that used to be rented out to a
student or other longer term tenant. With airbnb, it may be possible to make
up that income on fewer days, or to greatly exceed it as a full time rental.
That would result in a unit being taken off the market as a permanent rental,
which could certainly reduce supply and drive up prices.

------
adrianmacneil
> About 33,000 of these were vacant, generally as a side effect of rent
> control laws. (I don’t honestly know if rent control is a net good or bad
> thing—I assume more good than bad—but it certainly keeps units off the
> market.)

I will never understand why most Americans generally favor a tough-luck, fire-
at-will attitude for employment, but are in favor of rent control and making
eviction extremely difficult.

Coming from New Zealand, it's the other way around (it's extremely difficult
to fire people, but there is no rent control and you can evict anyone with 90
days notice).

Not saying one or the other is necessarily better (I personally think
somewhere in the middle for both approaches would be best), but strict
eviction laws and rent control always seemed very un-American to me.

~~~
gohrt
Americans don't favor a tough-luck, fire-at-will attitude. Employers do
(obviously) and employees don't. Same as with rentals.

~~~
kelnos
Eh, I wouldn't say that's universally true. As an employee, I've appreciated
it when it's been (fairly) easy for the company to e.g. get rid of a peer that
was dragging the team down.

Several of the (smaller) companies I've worked for would not have survived if
not for at-will employment. That's certainly helped me as an employee.

Fortunately I haven't yet fallen on the "wrong" side of that equation; I
imagine I might feel differently if I had... but then that's kinda irrelevant.

------
balls187
> Unfortunately, a lot of other people have problems paying their rent or
> mortgage. 75% of Airbnb hosts in San Francisco say that their income from
> Airbnb helps them stay in their homes, and 60% of the Airbnb income goes to
> rent/mortgage and other housing expenses.

Sources of this data?

How many Airbnb people are putting out property they own vs those who are
renting?

It sounds like people are abusing it to stay in homes they could otherwise not
afford, which is in itself adding to the housing problems in San Fran.

Facilitating someone easily renting out their home, great. Allowing renters
(and to a lesser extent home owners) subsidize their over extended living,
bad.

------
abalone
_" only about 340 units in SF were rented on Airbnb more than 211 nights,
which is what Airbnb has calculated as the break-even point compared to long-
term rental"_

This is a crazy figure. That's saying hosts only charge 1.7X more per night
than they would get from a roommate or tenant. That's ridiculous.

A quick search on AirBnB shows rooms in my neighborhood going for $130-230.
That's $4k-7K/month for a room fully booked. A quick search on Craigslist
shows roommates wanted for $1200-2200. That's about a 3X markup, nearly double
what Airbnb claims.

That matches anecdotally what I hear a lot. People are increasingly preferring
to AirBnB rooms instead of seeking roommates. They get more money and/or have
more control over their space. No getting stuck with a crazy roommate, no
overnight guests, you can have the place to yourself when you want, etc. This
takes housing stock off the residential market and moves it to the more
attractive tourist market. It's similar when you look at entire apartments too
and the incentives to hold onto them and Airbnb them after you've really moved
out, instead of letting new residents move in.

So the 75 day limit that Prop F proposes is much better targeted at changing
those economics than the current 120 day limit (which is not very enforceable
anyway). That means you'd have to charge 5X to break even vs. a long term
rental, which is too much. So it only makes sense to AirBnB rooms/units that
really would never go onto the long term market anyway.

------
1024core
The problem with Prop F is that it has some very dangerous side effects. Read
this detailed analysis if you want to know more:
[https://medium.com/@emeyerson/prop-f-is-worse-than-you-
think...](https://medium.com/@emeyerson/prop-f-is-worse-than-you-
think-17e395ca8761)

------
billiam
My friend Matt just summed up your cynical formulation: "let's let Airbnb
capture tax revenue so that people now in their homes can stay there a little
longer" as a hand sandwich: I will sell you two pieces of bread and convince
you it will taste good if you shove your hand and start eating.

------
seiji
Sam means well, but he does live 200% inside the internet hype machine bubble
vortex:

 _The whole magic of the sharing economy is better asset utilization and thus
lower prices for everyone. Home sharing makes better utilization out of a
fixed asset, and by more optimally filling space it means the same number of
people can use less supply._

"better utilization out of a fixed asset" is how we talk about factory
machinery, not so much living space.

Housing has physical implications and psychological cost. If we wanted
_optimal_ space filling, we'd put 10,000 bunk beds in a warehouse and tell
people to deal with it. The proles can have their bunk bed warehouse while the
billionaires can have estates in San Francisco. et voilà, optimal filling of
space allocated by level of monetary expenduture.

~~~
megaman22
> Housing has physical implications and psychological cost. If we wanted
> optimal space filling, we'd put 10,000 bunk beds in a warehouse and tell
> people to deal with it. The proles can have their bunk bed warehouse while
> the billionaires can have estates in San Francisco. et voilà, optimal
> filling of space allocated by level of monetary expenduture.

You know, if there were such arrangements, I'm sure that there would be people
who would jump on them. I'm a little surprised Google hasn't built company
dormitories, since they've got people living in vans in the parking lot rather
than paying $3000 a month for a studio apartment.

~~~
gohrt
Mountain View Citcy Council has consistently blocked Google's attempts to
expand housing.

------
chermanowicz
Your (and many) arguments about AirBnB revolve around housing, economics, etc.

There are other arguments to be made about the quality of service & safety.
Read some of the comments from another recent HN story:
[https://news.ycombinator.com/item?id=10291070](https://news.ycombinator.com/item?id=10291070)

My own individual and anecdotal story: as an individual whose neighbor was
AirBnB-ing his apt next door to mine, seeing dozens of unfamiliar faces (and,
without going into detail, the behavior and antics of some of these occupants)
did not make me feel safe. If anything, they should severely restricted under
this guise, not "affordable housing". (Though I do agree that more housing
would generally improve the situation for all).

------
caminante
Wow! ~2/3 of housing units in SF are rentals...

    
    
      "In 2014 (the most recent year with available data) there were about 387,000
      housing units in SF.  About 38% were owner-occupied, and the remaining 62% 
      or 240,000 were rental units."

~~~
cheepin
I wonder why this is... My first guess is that hardly anyone that works in SF
can afford to own housing, my second is that real estate speculators are
buying up and renting a lot of San Francisco property.

~~~
mrkurt
Prop 13. Very low property taxes create tremendous incentives to hold on to
real estate you own. People paying 2000 level property taxes on real estate
with 2015 level values are making a killing on rent.

~~~
dragonwriter
> Prop 13. Very low property taxes create tremendous incentives to hold on to
> real estate you own.

Very low property taxes should be relatively neutral between holding and
trading compared to higher property taxes.

Prop. 13 encourages holding over trading because, while it does control
property tax rate, it also constrains tax basis value increases to small
annual increases while you hold property, but reassesses at full market value
when you buy a new property. Which means, it increases the incentives to hold
on to property once you've purchased it and decreases the incentives to
purchase property, because the property is (net) higher value to the current
owner than a new purchaser with otherwise similar profile, since the new
purchaser would have to pay higher annual property taxes.

------
jsprogrammer
> _In the past year, only about 340 units in SF were rented on Airbnb more
> than 211 nights_ , which is what Airbnb has calculated as the break-even
> point compared to long-term rental.

Ok, there are a small number of units that are let or sub-let for 2/3 of the
nights per year. That doesn't tell us much. I'd guess it would be near a full
time job to keep your house let out 66% of the time. You wouldn't even be
living there most of the time...how can you even really claim it to be yours?

Any observation would show that the primary use is for AirBnB and their
customers.

------
smacktoward
_> I recently reached out to Brian Chesky, the CEO of Airbnb, to learn more
about this._

I didn't reach out to any of the sponsors or advocates for Prop F, such as the
political figures and organizations listed at
[http://www.sharebettersf.com/endorsements-propf-prop-f-
airbn...](http://www.sharebettersf.com/endorsements-propf-prop-f-airbnb-sf/),
of course. And while this post is full of stats that sound a lot like the kind
of thing you'd get from Airbnb PR, nowhere in it am I going to inquire further
and link to an opposing view, or really engage with opposing views in any
material way. I'll just dismiss them by saying that the solution is for SF to
allow more building, as if making that happen hasn't been the most contentious
and complicated issue in the city literally for generations.

One could also argue that I myself have helped drive up the high cost of
housing in SF, both by running a program that requires the people it admits to
move to SF in order to participate, and more generally by being part of a hype
ecosystem that aims to convince impressionable young people that the only way
to be successful in tech is to somehow jam yourself into this already
bursting-at-the-seams city. I'm not really going to engage with that line of
thought either, though.

------
Mz
The data cited here makes the bill sound ridiculous, though it also leaves me
wondering how many more units are being rented out on AirBnB with less
frequency than these 340 units. Still, SF was pricey before AirBnB. It is
ridiculous to try to blame local housing prices on this one company.

It looks like AirBnB meeds to do some serious PR work. I think thier rapid
rise is helping create the illusion that they impact the local housing market
more than they actually do.

~~~
mildbow
They are on it: Sam's post is part of the PR work.

Why else would he say the fix to the housing problem is to put more housing on
airbnb?

A huge part of the problem is that people are renting places just to sub-lease
them. Guess what that does? Yup. It increases pricing where you are paying the
zero value-add middleman more.

But hey, that can't possibly be part of the problem. /s

I'll leave you with this:

"It is difficult to get a man to understand something, when his salary depends
on his not understanding it."

\-- Upton Sinclair iirc

~~~
Mz
A) I did say up front that I wondered what the other numbers are that Sam is
not putting in the article -- the other half of the picture. I have, in fact,
read "How to lie with statistics" and I am well aware we are being
intentionally given a certain framing from a party with a vested interest.

B) However, I also lived in the bay area at one time, in Solano County, and
was pursuing education with an eye towards going into some kind of urban
planning related career. In fact, I founded and moderated a subforum for a
time on the most successful urban planning forum around at that time. So I
have some familiarity with how crazy prices were back then, before AirBnB was
a gleam in anyone's eye. And also I have some familiarity with the various
factors that go into forcing housing prices up. Saying AirBnB contributes to
the problem is not crazy talk. But acting like they are the single most
important factor meriting the passage of a bill intended to kill them off -- I
want a tad more data than "But look at the crazy high local housing prices,
man!" Because that falls far short of proving they are having that big of an
effect.

C) Yeah, I am very familiar with the saying. I am well aware of how hard it is
to be both profitable and ethical. So far, I have managed to be pretty
ethical. I am also dirt poor. So I am a little tired of hearing that anyone
making money is clearly The Devil. The fact that this is part of a pro AirBnB
PR campaign does not ipso facto make it inherently evil. The other side is
also engaging in a PR campaign, and they also have vested interest that you
can put a dollar amount on. Sometimes, people are actually doing work they
actually fucking believe in. Those people still need to EAT and put a roof
over their head. I am so goddamn sick of the idea that all the good people are
dead martyrs and, if you still draw breathe, you need to feel guilty about
every single fucking thing you do to try to keep body and soul together.

~~~
shostack
Given your interest in urban planning, what are your thoughts on what could
realistically cause housing prices to decline in the Bay Area? Particularly
interested in the Peninsula.

The main thing I've kept my eye on is interest rates, but there are obviously
other factors. I'm not convinced rising interest rates would even have that
much impact--there will always be people with more money who want to live here
for the weather/culture/food/location.

~~~
Mz
I haven't studied it (the specifics of what is going on in SF) well enough to
make specific recommendations for San Francisco. If I were on a task force
looking for answers, I would start by reading everything I could get my hands
on concerning a) California real estate taxes and b) rent control. I would
look for studies, I would look for what we can quantifiably show has a
measurable impact.

Then I would look at trying to find ways to incentivize making small spaces
with housing basics more available.

I would also look at economic factors like the fact that you can live in SF
without a car, so some people can afford the nosebleed rental prices because
they are paying only for rent rather than rent plus a car. And I would
consider creating a PR program around that angle. Walkable communities
typically are more expensive, because humans value the high quality of life
they afford, and they are mostly zoned out of existence. A lot of things that
historically created walkable communities cannot be recreated under modern
car-centric zoning laws.

Edit: To be clear, those are things I would start with, not _everything_ I
would do.

~~~
shostack
Thanks for sharing. Since the Peninsula doesn't have rent control, but DOES
have Prop 13, it has separate circumstances, but still many of the same
symptoms.

------
hoprocker
> About 33,000 of these were vacant, generally as a side effect of rent
> control laws. (I don’t honestly know if rent control is a net good or bad
> thing—I assume more good than bad—but it certainly keeps units off the
> market.)

If I understand it correctly, one of the most common ways of evicting rent-
controlled tenants is through owner move in. A side effect of this is that the
owner has to "live there" for 3 years[0]. Given this, it seems like this
statistic -- which, taken out of context, could be used to demonize rent-
controlled units as wasting valuable housing stock -- is actually forced on
the short-term rental market by profit-seeking landlords.

[0]
[http://www.sfrb.org/index.aspx?page=965](http://www.sfrb.org/index.aspx?page=965)

------
samstave
> __ _His flat is still on Airbnb and guess what, you can still "Instant Book"
> it! And I'd lay odds if you do, you'll be met at the door with some shabby
> excuse about why it isn't ready, but don't worry, he has another place for
> you not far away..._ __

WHY doesn 't AirBnB have a fraud checking department where apartments like
this are booked by agents of AirBnB to check in on just such things.

If ALL AirBnB hosts KNEW that their next tenant ___COULD_ __be an actual
AirBnB rep -- then they wouldn 't pull shit like this as often.

And they should be able to get a "Verified good by AirBnB stays"

------
MaysonL
The price of housing in SF has about doubled in the past 5 years, according to
the post. What has happened to the price of hotel accommodations over the same
period?

------
pcmaffey
We have the same affordable housing problem here in Boulder, but on a much
smaller scale than SF. It's been this way for over a decade... Unfortunately,
fixing this housing dynamic is not so simple as increasing supply. Incremental
increases in supply can never keep up with exponential demand.

IMO the highest impact solution is to focus on transportation. But that's a
topic for another discussion.

~~~
shostack
How has it impacted Denver and the housing market there? Also, are there still
"affordable" and safe parts of Boulder? My understanding is there is plenty of
land that can be developed there.

Would love to understand more about the housing market over there since you
don't see it in the press nearly as much as the Bay Area.

~~~
pcmaffey
The greater effect has been on the suburban sprawl towns in between Boulder
and Denver. Places like Louisville, Lafeyette, and Longmont have seen dramatic
increases in both prices and quality of living, just in the past 5 years.
These towns don't have the restrictions on development that Boulder does. So
that's where the growth is going.

Boulder continues to develop, but its pace can't keep up with demand at all
(which is a good thing). It's a university town, so there's lots of rentals.
But as for purchasing homes, there's really nothing "affordable" in Boulder
proper (except perhaps compared to SF). Nor are there any "unsafe" parts of
Boulder...

~~~
shostack
Interesting, thanks for the insight. Would you consider any of these sprawl
areas as desirable at all? I'm trying to form a comparison to the Peninsula
here in the Bay Area.

How is safety in those other areas or Denver proper?

~~~
pcmaffey
Yeah, certainly, each has its own vibe. Sort of depends on what you're looking
for. Colorado in general IMO is the coolest state in the nation (and I've
lived in a few). The different areas represent magnitudes of that. They are
all relatively safe, compared to East coast (where I'm from). Though I can't
speak much for Denver as I don't need to go there much...

Compared to the bay area, I used to live in the mountains of Santa Cruz, and
now live in the mountains outside Boulder. Other than that, I don't have much
experience with the differing areas of the SF peninsula.

I'd recommend maybe starting your research with Louisville. It's blown up
quite a bit recently, but is not quite at Boulder prices.

If you have some specific questions about places from there, I'm happy to
help. :)

------
dynofuz
The real solution here is to change the laws protecting gigantic swaths of
ugly "historic" districts like the mission. Unfortunately no politician or
home owner wants to vote for this because it would dramatically devalue their
homes if SF is finally allowed to build vertically. Then the tiny increase in
housing costs due to Airbnb is no big deal.

------
Xyik
Why doesn't AirB&B work to reduce prices? Once it becomes less profitable for
people to sublet their places for the sake of making it money, maybe people
will see it as less of an evil. There are far too many hacker hotels in SF on
AirB&B charging ridiculous rates, jamming up to 20 people into a single condo
stacked with bunk beds.

------
ilaksh
[http://runvnc.github.io/tinyvillage/](http://runvnc.github.io/tinyvillage/)

------
rootedbox
A guy with a bias; is trying to tell me that lessoning supply in a super high
demand region is only nominally effecting prices.

my head is spinning..

~~~
sama
Actually what I'm saying is that much more supply is the thing that will drive
prices down.

(And also that the number of units that are effectively full-time rented on
Airbnb is just about 1% of the entire off-rental-market supply--let's get that
99% back!)

~~~
rootedbox
It's just your argument requires me to believe...

"In the past year, only about 340 units in SF were rented on Airbnb more than
211 nights, which is what Airbnb has calculated as the break-even point
compared to long-term rental."

This just didn't sound right; and doing the quick math with the average one
bedroom going for 3500.. To reach that 211 day number would mean that rentals
on air bnb are going for about 200.

But doing a search in SF for air bnb the average rental is 422.. Now some of
these are multi room, and some are just a couch.. but I can't seem to find a
single 1 bedroom non-share for under 260.

This makes that 211 figure feel like its off. Which makes me feel that the 340
units is off.

Can we see the calculations used? Also is there a big jump in those units at
210 days.. 200 or 182..

I mean as a land lord if you only have to work half the year and make only a
little less revenue; plus the positive of less liabilities I could see my self
wanting to air bnb over rent out my unit.

~~~
rootedbox
Also when you throw rent control into the math.. the calculation used is non-
linear and way below 211; very very quickly; because of flat monthly revenue
of rent control vs. monthly increase in revenue from an upward market. I would
suggest you revisit the math.. or ask to see the data of who did the math for
you.

------
ksherlock
What some people call "the sharing economy" is not new. After all, what is the
world's oldest profession if not "sharing" genitals. Sometimes with a
middleman (or "pimp") taking his cut.

------
geebee
Unfortunately, some of the problem may be the language we use to advance our
points. Here's a phrase that I think really does illustrate this:

"Making it harder to share your home in San Francisco may make it impossible
for some of these hosts to afford to stay in their homes and in this city."

I really do want to discuss this reasonably, but to me, this is clearly a
misuse of the word "share". There is a powerful emotion around "sharing", and
to say that San Francisco is making it harder to "share" your home does have a
different ring than saying it is making it harder to "rent out your home short
term".

I will certainly agree that there can be some ambiguity around the word
"share". For instance, if two people both pay equally for a large sandwich,
they might say they "shared" it rather than "split it". But when you list your
room on a website for a certain price, and someone pays you for it, I don't
think we're anywhere close to that ambiguous grey area. This is clearly a
quid-pro-quo commercial transaction. They can be friendly transactions, people
can get to know each other through these transactions. I'm not even saying
it's an undesirable transaction (more or less everyone I know things that
airbnb has its place, though there is great disagreement over how these
rentals should be regulated).

But I really don't think it's "sharing" by any reasonable definition of the
term.

~~~
sama
That's a good point; now that everyone calls it the sharing economy that's the
word that came to mind. But I'll change it.

~~~
chralieboy
"Sharing economy" is just the marketing term for it. If I share a bench with
you, I'm not charging you for the privilege. I agree that it is the word we
use, but it doesn't accurately communicate what we're talking about.

It's a difficult line to walk. On the one hand, sharing sounds nice. Even as
capitalists we are suspicious of efforts to make a profit. And many of the
"sharing economy" services are about using things that you personally own and
selling use of them to the public.

On the other hand, when AirBnB/Uber/etc try to make an economic argument for
their services, it is clearly not around sharing. We're exchanging value (my
empty home, parked car, etc.) for value (your dollars, as a proxy for work you
have done.)

~~~
bduerst
I get that you're trying to break down "sharing economy" by the semantics of
the word "share", but even in your hypothetical the bench is [presumably]
owned by the city, who has granted already access to it for everyone.

By sharing access to economic goods and services that were previously
unavailable, waste from market inefficiencies are being eliminated. Just
because companies are profiting from this waste elimination doesn't negate the
fact that shared economies can still be beneficial.

Even so, considering the size of these markets now, I don't think people are
going to confuse "Sharing economy" with altruism.

~~~
geebee
People have chanted "sharing is caring" at demonstrations against greater
regulations and restrictions on short term rentals. I think we're stepping
close to a deliberate ambiguity.

------
swagv
Looking forward to the day where nobody can afford to live in SF unless they
are also running a private hotel. That will be the new standard.

