After entering the China market for more than six years, Airbnb announced on May 24, 2022 that Airbnb China will shift its focus to outbound travel and suspend support for domestic travel listings, experiences, and associated reservations. Airbnb’s withdrawal from China’s market is not surprising. According to market news, Airbnb has 6 million listings around the world, but only 150,000 of them are in China, and the China market accounts for only 1% of Airbnb’s revenue (Boon & Goh, 2022). Ever since Airbnb’s advent into the Chinese market, it has encountered challenges continuously from the severe regulation imposed by the Chinese government. Now, this strict jurisdiction has also become one of the driving forces to crush Airbnb’s China market. For community-based sharing platforms like Airbnb, their operations and markets largely impacted by the moderation of local governments. Over-strict supervision from administrations will directly impede the expansion and survival of companies. On the other hand, a lack of suitable regulation would likely lead to an increase in conflicts between consumers and landlords, resulting in irreversible costs.
This article will compare the regulations implemented by various nations on Airbnb. China and America will be the primary focus, with countries such as Australia and UK mentioned as comparative objects. In the end, the essay will attempt to develop more balanced regulatory approaches that can maximize the benefits of the government, Airbnb, landlords, and customers.
CHINA：when policies become overly-strict…
As previously stated, policy restrictions play a significant role in Airbnb China’s failure. Similar to how China’s hotels require registration with an ID card, Airbnb accommodations in China do not allow undocumented guests, particularly foreigners and individuals from certain special areas. Before any check-in, situations of such kind must be reported to the local public safety administration, and a photo ID must be submitted to the local police station. In September, 2021, the local government enacted a regulation requiring the short-term leased host to display six certificates prior to operation. The certificate includes the house’s ownership, the owner’s identification card, and a signed written guarantee of public safety from the authorities. According to the Global Times, it is quite difficult for landlords to obtain all these six certificates, and all accommodations that do not meet the standard will be abandoned promptly. Airbnb used to be subject to stringent regulations in Spain and the United Kingdom, and China was no exception, after all, it is a foreign-funded enterprise that is concerned with the security of each resident’s personal data. As the Covid-19 epidemic’s pandemic progresses, the situation worsens. The “zero-clearing policy” implemented in the majority of metropolitan areas resulted in a severe blockade of millions of domestic travelers. Airbnb generated six billion dollars in revenue the previous year with a 77% increase from the previous year, but the China market barely contributed to this success. Last year, LinkedIn announced that it had “reformed” a decision to almost abandon the Chinese market. Airbnb’s departure appears to be no longer inexplicable. Since then, “Let Love Meet Each Other” becomes “Let Love Never Again” (Martins, 2022).
America：when policies become overly-loose…
China’s government policies towards Airbnb may appear to be excessively stringent. However, what occurs in the United States of America demonstrates that sometimes these stringent policies are actually necessary. Take New York as a good example. Airbnb almost got permanently banned from listing short-term rental because it caused direct or indirect harm to the urban economy and its residents in the absence of adequate government oversight. Based on the data collected, the damage could be both economically and physically. Looking through the financial perspective, it is obvious that the existence of Airbnb exacerbated the housing shortage of the state, and inevitably tear the gap between the rich and the poor. For instance, due to the absence of relative supervision held by the local administration, some unqualified, unscrupulous landlords often choose to evict their tenants, the majority of whom are low-income, in order to market their apartments on sharing platforms like Airbnb. According to a report published last year by the Attorney General of New York, Airbnb landlords generated $168.3 million in revenue between 2010 to 2014, of which more than 37 percent came from landlords who owned three or even more houses (Hawkins, 2016). Oct 22, 2016, New York Governor Andrew Cuomo signed a bill making it unlawful to list apartment on Airbnb for less than 30 days. As response, Airbnb strongly opposed the law and invested $10 million to prevent the law from pass. In order to achieve that, Airbnb made concessions by banning its landlords from publishing multiple apartment listing so that they are unable to provide listings to those seeking permanent lodging. The progression was slow, local activists predicted that this practice would make city’s rents even higher and decreased the amount of cheap, affordable housing (Hawkins, 2016). However, the solution is no single. Methods like collecting or canceling visitor taxation, or banning reservations after the renting reaches a certain threshold are also available and introduced in some areas. In London, Airbnb has implemented a “day counter” that restricts appointments beyond a 90-day calendar year threshold, unless the host has planning approval to operate a vacation rental property (Gurran & Phibbs, n.d.).
Admittedly, the economic inconvenience caused by the inappropriate supervision of the government can no longer be underestimated already, it fades in the face of safety risk. Even though The United States has the most Airbnb venues in the globe. A nationwide uniform rule has not yet been published and implemented. It is quite conceivable that how many security risks can Airbnb potentially have. A study was conducted to determine the fire safety of Airbnb accommodations in the United States. It quantified the number of fire safety and first aid facilities at Airbnb venues. After visiting 120,691 Airbnb accommodations across the nation, the researchers observed and recorded the percentage of smoke and carbon monoxide detectors, fire extinguishers, as well as first aid supplies. The testing results are not satisfactory and huge safety risks were observed. Among these observed samples, despite the fact that most of them were equipped with smoke alarms and carbon monoxide detectors, fewer than half owned fire extinguishers and first aid supplies, and clearly, they are not fair passers of the National Fire Protection Association requirements (Kennedy et al., 2018). Beyond safety problem, many other issues also influence consumer’s tangible experience when using Airbnb, such as the inaccuracy of depiction of the accommodation on the platform; health and hygiene issues, Noise pollution and so on. In these facets, more detailed and stringent supervision and monitoring is undoubtedly required.
Boon, K., & Goh, A. (2022, May 24). Airbnb says it will be removing all 150,000 of its listings in China. Local hosts and users don’t seem to care. Business Insider. https://www.businessinsider.com/airbnb-leaving-china-citizens-unfazed-reactions-rental-listings-2022-5
Gurran, N., & Phibbs, P. (n.d.). Australian governments are treading lightly around Airbnb. The Conversation. https://theconversation.com/australian-governments-are-treading-lightly-around-airbnb-76389
Hawkins, A. J. (2016, October 21). Airbnb is now banned from listing short-term rentals in New York. The Verge. https://www.theverge.com/2016/10/21/13361536/airbnb-new-york-cuomo-bill-ban-short-term
Kennedy, H. R., Jones, V. C., & Gielen, A. (2018). Reported fire safety and first-aid amenities in Airbnb venues in 16 American cities. Injury Prevention, 25(4), 328–330. https://doi.org/10.1136/injuryprev-2018-042740
Martins, I. (2022, May 25). Why Airbnb is Shutting Business in China and Removing Listings. Newsweek. https://www.newsweek.com/airbnb-shuts-remove-business-china-1709555