Airbnb has come under renewed pressure from both sides of the Atlantic, with Toronto winning a major victory over the proliferation of ‘ghost hotels’ and Paris denouncing a ‘risky’ deal between the Olympic committee and the short-term rental company.
After nearly two years of appeals, an Ontario court has ruled in favor of regulations passed by Toronto, Canada’s largest city, aimed at curbing short-term rentals.
The new rules require operators to live in homes they list online, including those listed on Airbnb; limits them to listing three rooms at a time; and requires them to register to rent a space.
In recent years, Toronto has been struggling with a housing shortage, with rental vacancy rates hovering around 1.1%, below a “healthy” rate of 3%. Much of the frustration over the crisis has been directed at Airbnb. Critics argue that this incentivizes landlords to pull rental units off the long-term market; research suggests that Airbnb’s presence has removed thousands of rental units from the market.
The spokesperson for the San Francisco-based company said Toronto’s rules would “unfairly punish” responsible landlords, but it would work with the city when the regulations go into effect.
John Tory, Mayor of Toronto, said: “This is good news for Toronto residents and a step in the right direction when it comes to regulating short-term rentals and keeping our neighborhoods livable. “
The ruling could see 5,000 long-term rental units return to the market, according to court arbitrator Scott Tousaw. “Whatever the number, one fact is indisputable: each dedicated [short-term rental] the unit displaces a permanent household. This household needs to find another place to live,” he wrote.
FairBnb Canada, an advocacy group seeking tougher rules, called the ruling a “major victory” for renters. “Much of the president’s reasoning reflects our position and confirms that we have been reasonable advocates of fair rules from the very beginning,” he said.
Although the court ruling reduces supply shortages in the coming months, many residents are still struggling to cover the cost of rent. A survey of the Canadian Rental Housing Index found Toronto to be ‘extremely unaffordable’residents often using more than half of their income to pay rent.
Officials in Paris also blamed Airbnb for causing a shortage of long-term rental housing in the city, driving up rents and pushing out the middle class.
On Tuesday, the city’s mayor, Anne Hidalgo, expressed her “total determination” to rein in Airbnb and threatened to ban it in parts of central Paris.
The French capital is one of Airbnb’s biggest markets with around 60,000 listings, up from just 4,000 in 2012. The company has signed a controversial deal nine-year sponsorship agreement with the International Olympic Committee (IOC) Monday.
Hidalgo, a socialist who is seeking re-election as mayor next year, has already introduced measures requiring Airbnb owners to limit rentals to 120 nights a year and register their properties with the mayor’s office, which is suing legal action to obtain €12.5m (£10.7m) from the company for failing to expel those who did not.
In a letter sent to IOC chief Thomas Bach ahead of Monday’s deal, Hidalgo warned that any rapprochement would be risky. “By removing a significant number of accommodations from Paris, Airbnb is contributing to rising rents and worsening the shortage of apartments in the rental market, at the cost of all Parisians, especially the middle class,” writes Hidalgo. She accused Airbnb of “destabilizing local businesses and competing hard with traditional hotels”.
The mayor has threatened to severely restrict and even ban short-term tourist rentals in parts of the city unless tougher restrictions are put in place. Last month, the French upper house, the Senateapproved a measure allowing local authorities in France to reduce the maximum number of rental nights between 60 and 120, but this decision is unlikely to be adopted by the National Assembly.
Jean-François Martins, the deputy mayor in charge of sports and tourism, said that if Hidalgo were re-elected, the town hall would hold a referendum immediately after next year’s elections so that Parisians could decide “on the conditions of use of Airbnb” in the city.
“She thinks Airbnb has a bad impact on housing. Parisians will have several options to choose from, including the possibility of banning Airbnb in certain areas,” he said.
Joe Gebbia, co-founder of Airbnb, said the IOC partnership “will ensure the Games are the most inclusive, accessible and sustainable to date”.
But Ian Brossat, the deputy mayor in charge of housing, said he regretted the choice of the IOC’s partner “at a time when many cities in the Europe and the world is fighting back against Airbnb”.
On Twitterhe wrote: “[It is] totally irresponsible considering the disastrous consequences of Airbnb on our cities. We are dealing with a company that cannot afford to pay its taxes in France but can find the means to sign an agreement with the IOC.
Comments are closed.