I’m staying in New York this week, as ever the city offers some insights into trends that might be heading our way. I’ve just had a look around a state of the art gym that is huge but borrows design ideas from the boutique hotel and offers one to one sit down sessions on your metabolism to aid nutritional understanding. That’s as well as a personal trainer.
When I was looking for accommodation, I went down the Airbnb route and I’m staying with a great guy close to all the action in Hell’s Kitchen. He’s given me lots of ideas for places to go, I’m joining his gym for a week, I’ve got access like him to the Citibike hire system. It’s the New York version of London’s Boris bikes and I’ve used three so far today. I’m enjoying it so much more than staying in a hotel, I feel like I’m being a New Yorker for a week.
Accommodation in New York is inevitably expensive: A hotel for a week will cost at least $1400 and I paid just under $1100 for my room in a flatshare. I’m enjoying having a flatmate for a week, but I’ve started to think about the implications of this guy earning from me – and who owns his flat. I don’t know his circumstances and I don’t want to pry, but I suspect he is renting and it’s quite likely that neither his landlord nor the owners of the block know he is doing Airbnb. He can earn $1000 a week and that must be heavily subsidising his rent. The landlord gets his or her rent and is none the wiser. Is that any better than subletting or rent to rent? Should the landlord be sharing some of the profits? Or if the whole process is being managed well, is it not just a way for tenants to make hefty rents more affordable?
As far as I know, none of my tenants are doing Airbnb. I make regular visits, I know exactly who is living in every property. I’ve started wondering how I would feel if somebody was letting a room to the occasional Airbnb…. a bit miffed probably…. it’s not the idea, they are renting long term from me and shouldn’t be letting out rooms without my permission. If they asked me, would I accommodate their request? I might be worried about losing control of keys and occupancy, issues like security, extra wear and tear and insurance. My biggest concern about any kind of subletting is not having face to face contact and therefore trust and rapport with the subletters.
We all know that Airbnb is a growing market, creeping into the nooks and crannies of hospitality and residential letting. I made a new friend in Madrid last month who is managing 20 Airbnbs for a range of contacts. He is basically a short let agent and has lots of systems set up, including a lock up where he leaves laundry to be collected and delivered by his contractor. He says it’s hard work because he has guests contacting him and arriving at all hours, but he is making a full time living from the business.
In London, the short let restriction of 90 days, enforced by Airbnb is absolutely appropriate. Potential long term accommodation should not be supplanted by accommodation for tourists in a city where we have a shortage for our citizens. Many cities like Madrid don’t have a shortage and Airbnb is mopping up spare capacity. Tensions in cities like New York that have rent stabilisation programmes are created where landlords are forced to receive subsidised rents only to find that their tenants are then letting on Airbnb.
In England and Wales denial of subletting is an unfair contract term, though landlords can insist on permission being sought, but it should not be unreasonably withheld. So we are at liberty to refuse Airbnb and could site various legitimate reasons. Although I’d look at each request on a case by case basis, my gut feeling is reticence. There’s something about the tenant profiting at my expense. But then the argument that it could make renting in London more affordable is persuasive. Would three occupants with an occasional Airbnb be preferable to 5 people squeezed into a property full time to help with affordability?