San Francisco Voters Reject Proposed Airbnb Crackdown

Published December 7, 2015

San Francisco residents voted down a ballot measure to impose new restrictions on Airbnb and other peer-to-peer, short-term rental services in the city.

The proposal, Proposition F, would have required Airbnb hosts to file quarterly activity reports with the San Francisco City Planning Department and would have limited homeowners to host Airbnb guests for a total of 75 days per year.

Regulators for More Regulations

Ian Adams, a senior fellow with the R Street Institute, says regulators are intent on expanding their authority.

“Regulators are so eager to bring about regulations on Airbnb,” Adams said. “When you’ve got a product that’s far more transparent than traditional situations, or even hotels to a certain extent, you have confidence mechanisms in the form of online reviews that are consistently vetted and re-evaluated. Airbnb, at the end of the day, has a huge incentive to self-regulate, unlike a hotel and unlike someone who is renting long-term.”

Housing Crunch

Adams says San Francisco’s restrictive housing and zoning policies, not Airbnb, are causing problems for consumers searching for a new home.

“The housing situation in San Francisco right now is really unique,” Adams said. “The message proponents of the ballot initiative were trying to send … was essentially a social justice narrative, which was to say, ‘If you vote against Prop. F you are voting to punish people who are renters, because this will lead to fewer homes on the market and the need for stricter controls.'”

Restricted Supply

Benjamin Powell, a senior fellow with Independent Institute, says Airbnb’s growth can actually help solve the city’s housing crisis.

“I think people in San Francisco and the Bay Area in general have a desire for affordable housing, but what they don’t have is a tolerance for residential development,” Powell said. “As a result, the supply of housing is restricted, and that jacks up prices.”

Homeowners, Consumers Win

“On the margin, [Airbnb] does something to make housing slightly more affordable, without actually building something,” Powell said. “It lowers their cost of ownership. On the margin, it helps make their homes more affordable, if they recover some of the costs with Airbnb.”

Powell says increased competition and freer markets are good for everyone, not just San Francisco homeowners.

“Airbnb is good for competition, not just for housing affordability, but [also] for hotel rental affordability, both in choice and price,” Powell said. “We’ve certainly seen the pressure that Uber has put on taxicabs in many markets across the country, and it would be a good thing if Airbnb does this for hotels.”

Kimberly Morin ([email protected]) writes from Brentwood, New Hampshire.