Since the emergence of AirBed&Breakfast in 2008, it has revolutionized the global hospitality industry. Today, Airbnb is a $25.5 billion business, listing around 1.5 million properties in 191 countries, attracting more than 60 million users worldwide (Airbnb.com). Despite growing interest from consumers, Airbnb does not operate in line with current regulatory frameworks. Some argue that private regulation will outperform government regulation as the private system would promptly adapt in different cases so that hosts may offer reasonably safe, quality rooms at affordable prices to consumers (Robert Murphy). However, the lack of government regulation on Airbnb’s business operation has raised concerns among hotel operators and authorities alike. …show more content…
As Airbnb is a relatively new service, the lack of regulation by the government gives the service an unfair economic advantage over hoteliers. Hosts of Airbnb’s listings do not need to comply with the same norms and regulations enforced on hoteliers. For instance, a large amount of the income generated by Airbnb’s businesses transactions are not taxed. Instead, only certain commissions are charged with 6% Value Added Tax (VAT) (netivist.org). In addition, Airbnb does not have to meet health, safety or disability compliance standards, which are required by brand inspectors, health inspectors, and other government agencies for the case of hoteliers (Robert Habeeb). Nonetheless, the unfair economic advantage that Airbnb possesses creates unnecessary conflicts in the hospitality industry. For example, The Financial Times reported that a French hoteliers association, AhTop, has filed a formal complaint against Airbnb, claiming that Airbnb competes unfairly in the country. While these conflicts have not escalated into deeper problems, it is best to curb them now with appropriate government regulations. As shown above, it is clear that Airbnb service possesses an unfair economic advantage over regular hoteliers and hence should be regulated by the …show more content…
The depletion of long-term permanent housing caused by Airbnb is unlikely to be addressed by deregulation or a framework self-regulated by Airbnb (Federal Trade Commission Workshop). Some avaricious landlords invest more in housing stock to be used for rentals purposes as Airbnb provides a profit incentive to landlords to rent their units out to tourists in lieu of tenants on a full-time basis. As proof, the New York City’s Attorney General’s analysis showed that there are 1406 Airbnb hosts referred as “Commercial Users” because they rent out anywhere in between 3 and 272 units – 124 of them operate ten or more units in 2015. The results proved that a large segment of the Airbnb’s host population is influenced by commercial interests renting out multiple apartments as short-term hotels. The seismic impact of Airbnb on housing market can be seen as The Los Angeles Alliance for a New Economy, estimated that in March 2015, more than 7000 houses have been taken off the rental market for the use as short-term rentals (The San Diego Union-Tribune). Other than that, Airbnb could impact the property market by reducing affordable housing available for the lower-income community. For example, in 2014, Airbnb removed 1% of the units from Los Angeles’s rental market— and extensively more in some districts—while monthly rents increased by 7.3%, reducing the affordable housing
Furthermore, a business leaving an area could cause the loss of jobs and lower the value of an area, causing it to be less desirable. The real estate market decides the value of a
In order to understand our statistical data, we must first accurately grasp the definitions of gentrification and displacement. Gentrification means a demographic or physical change that conforms to the middle class. The financial definition of middle class means that a single individual or household makes between $50k-120k annually. Uniquely, displacement is the removal of something or someone by something else that takes their place. In our case, looking at gentrification in the San Francisco area within the last 10 years will possibly birth an explanation as to why Artist displacement is/was on the rise.
The price growing on homes in Washington, San Francisco, and New York has increased focusing more homeless people to suffer. Since, 2013 the homeless population has grew 12% while Mr. Garcetti
Introduction - If you’re an aspiring Airbnb host, it is of paramount importance that you ensure all your renters are comfortable in their temporary lodgings. That means making sure the listed property is warm, secure, and, above all else, clean. Keeping your rental property clean can be a difficult task, especially as some travelers can be a tad more careless than others, but it must be done if you are to satisfy clients and maintain a good reputation on Airbnb. In order to help you keep your tenants comfortable for the duration of their stay, I have prepared this list of some of my top tips for maintaining a tidy Airbnb space.
Have you ever had to choose between eating or having a roof over your head? If you answered no, you are one of the fortunate ones who most likely fall somewhere between middle class to upper class. Those who answered yes are a part of the millions of Americans who are currently facing a fairly new problem that has a light upon it – the lack of affordable housing. In Matthew Desmond’s book Evicted, he writes about numerous eviction stories of families or individuals for several different reasons.
One of these sources includes, “the University of Washington professor Gregg Colburn,” and, “the data scientist Clayton Page Aldern” (Demsas 2022). By including this source in her essay, Demsas can support her argument and make it more credible by showing that she has done her homework to provide reliable facts and statistics. Demsas proves that she is trustworthy and credible and shows her knowledge of the topic in her writing. Demsas, an authoritative and knowledgeable writer, is respected by managers from several different writing companies and has written over 20 different stories for several companies, including, “The Obvious Answer to Homelessness.” The author’s tone is knowledgeable, trusting, and optimistic, persuading her audience that housing scarcity has caused homelessness.
Airbnb was established in 2008 in San Francisco, California, by its founders Joe Gebbia, Brian Chesky and Nathan Blecharczyk, who were not able to find any free rooms in a hotel while attending a conference. As a consequence of that, the idea to offer private rooms online emerged, where clients could book them easily via their smartphone, tablet or computer. ‘On one side the platform enables people to list their available space and earn extra income in the form of rent. On the other, Airbnb enables travelers to book unique home stays from local hosts, saving them money and giving them a chance to interact with locals. Catering to the on-demand travel industry, Airbnb is present in over 190 countries across the
Supporters assert that Uber is altering the transportation benefit industry. Financial specialists plainly trust Uber will be solid in the market over the long haul. Uber has a brilliant future and development openings are tremendous. It is hence imperative for Uber to guarantee the wellbeing of their riders and the drivers. They ought to likewise embrace controls to guarantee that self-employed entities utilizing their application obey important nation laws.
Why did IKEA go international? Before starting to analyze IKEA’s internationalization, let’s consider on the question “why do companies go international?” Generally, companies go international for a lot of reasons, but the main ones are company growth and profit making as well.
The offers of accommodations via Airbnb are currently available in 192 Countries and in over 34,000 cities worldwide (O 'Toole, 2014). The valuation of Airbnb, the home-rental platform, is worth of $10 billion after it raised $450 million from private investment firm TPG in 2014 (Spector, Macmillan & Rusli, 2014). The type of business of Airbnb can be categorized to social networking service which focuses on the accommodation-rental service. The concept of Airbnb is actually a sharing economy which enables the customers to become the micro-entrepreneurs at the same time. Airbnb aims at not only providing the accommodation opportunities but also the experiences for people to interact with others all around the world and get to know how the local people live in a certain city and have some culture exchange experiences with international guests and hosts.
CASE JOURNAL-ROSEWOOD HOTEL& RESORTS Rosewood’s management is on the right track to increasing brand awareness among its customers by pursuing the corporate branding strategy. Implementation of the corporate branding strategy not only increases the number of repeat visitors to the hotels, but also increases the gross profits made by the company by $2,599,000. Corporate branding has a positive impact on the customer lifetime value as well. Rosewood Hotels & Resorts is a privately owned hotel management company that is known for its unique properties like The Carlyle and the Mansion on Turtle Creek that differentiates the company from other luxury hotel competitors.
The Five Competitive Forces of Industry will influence prices, costs and investment (Porter, 1980). The potential retaining of customers, profitability of a holiday inn can be determined by being aware of the strengths and weaknesses of the hotel industry. (Figure 2.2: Porter’s Five Forces Model (Source: Adapted after Porter,2008) Porter’s 5 model helps in success of Holiday inn between suppliers and buyers. Giving customers the service they are looking for, acquire customers, retain customers and looking externally how the competitors are doing is very important. To ignore the power of customer relationship is not an option.
In the case of hotels, suppliers create different consumer segments, we can relate to them as lower-end consumers, and higher-end consumers. Obviously, hotels cannot set the price that higher-end consumers are willing to pay, because all lower-end consumers will not be able to afford the good. Inversely, if hotels set the price that lower-end consumers are willing to pay, higher-end consumers gain huge consumer surplus, thus lowering the profit for the suppliers. In order to take the consumer surplus, hotels keep lower prices for some rooms in order to target lower-end consumers and offer some higher quality rooms (for example presidential suits) to target higher-end consumers. The difference in revenues providing different rooms and the same ones is seen below.
Having a value of over $10 billion, Airbnb “exceeds that of well-established global hotel chains like Hyatt” (Hospitality Net). This proves that this online service is significantly surpassing these stable hotel chains that have been competing in the industry for over 60 years. Along with this, a recent report by HVS Consulting & Valuation found that “hotels lose approximately $450 million in direct revenues per year to AirBnb” (Orourke). Although Marriott International has been performing with a 45% increase in revenues from 2012 to 2016, Airbnb has definitely had an impact on the consumer perspective of traditional hotel rooms. In addition to this, hotels also lose over $108 million of food and beverage revenues as a result of guests not spending their money at the hotel’s restaurant.
Every industry to include the hospitality industry is impacted by external factors which directly influence organizational behavior and decision making. There are numerous factors to be considered, but political, economic, and social are three of the most influential. These outside factors sway managerial operational decisions daily regarding personnel, spending, policy, and short-term and long-term strategic planning concerning both core and exterior operations. As within every industry, the hospitality industry has unmanageable elements that affect management or ownership of hospitality establishments (Lewis 2017). Understanding these factors is important because it provides an opportunity for contingency planning (Lewis, 2017).