Quebec Cracks Down on Airbnb

http://www.theglobeandmail.com/news/national/quebec-cracks-down-on-airbnb/article12162984/

by mattm • 13 years ago

56 51 13 years ago

guylhem• 13 years ago

Considering the outrageous prices charged by motels in every city I've been (up to Chicoutimi) and even by road side motels near nowhere, I'm not surprised :-/

>Business groups like Montreal’s Bed and Breakfast Association have been pushing for the government to crackdown on home rentals for years.

Yeah. I sure wonder why.

noarchy3• 13 years ago

The establishment hotels/motels want protection from competition, which governments are often only too happy to provide, sure. But don't forget the taxes that Quebec no doubt hungers to collect, whether the $250 permit fee, or unreported income. For all parties involved, follow the money.

cmsmith• 13 years ago

There are regulatory mechanisms to make hotels and B+Bs pay their share of externalities. These are things like property tax, room tax, and insurance.

Suppliers of airbnb units avoid a lot of these payments because they're paying taxes at normal residential rates.

If the cost of a room is $100/night, and the cost of that extra stuff is $50/night, then there is no way that hotels can compete on an even playing field with airbnb.

skylan_q• 13 years ago

Too bad. :)

andrewfelix• 13 years ago

I'm feeling some hyperbole coming on, but governments rarely seem interested in serving the interests of their constituents.

jasonlotito• 13 years ago

In quebec's case, especially Montreal, renters have all the power. It is fairly trivial to rent a place and never pay rent, and have laws essentially guarantee it take a not insubstantial amount of time to get you removed. So no, in this case, the government ones so much for its citizens that I'm actually surprised thy are siding against airbnb here. Considering everything else they can get away with.

dmix4• 13 years ago

Competitive disruption considered harmful.

If it really was to protect the turism economy and the people of Quebec, they should evaluate how many more people can visit Quebec now that there are options like $25-40/night rooms.

I know AirBnB was a big reason I visited NYC since it made the trip significantly more affordable.

potatolicious2• 13 years ago

Competitive disruption with substantial negative externalities considered harmful.

Yours is a convenient, feel-good, but ultimately incorrect and intellectually insufficient narrative. As is any narrative where one side is the altruistic freedom fighter and the other side might as well have vampire fangs on. The world isn't this simple.

This isn't directed strictly at you - it's a general attitude in the Silicon Valley echo-chamber that I find grating. Have we issued so many press releases extolling our own virtues that we now completely believe it ourselves? Are we so enamored with ourselves that we can't imagine any other reason for people not liking what we do except pure greed and unmitigated corruption?

Hell, I like AirBnb. I use it. But let's not pretend that there are no problems with it, and that there are no legitimate reasons to object to it.

dmix4• 13 years ago

I've read the other AirBnB threads on here discussing the externalities. And I still think the cities would be better off with AirBnB than without it.

The opportunities for property owners to profit as well as providing tourism/business visitors with $40 rooms is massive.

It's opening up a huge new bnb industry, provides a large flow of new revenue for tourism businesses in the cities, greatly expands the amount of tourists/business visitors who can afford to visit.

I'm curious which of the externalities you think can't be addressed by property owners? For example, they can have a no-airbnb policy in the rental agreements. Or liability safety waivers. Or security policies to limit flow of non-tenants. Or handled via disputes between property owners or police such as sound violations.

Besides, the incentives mentioned in the article are a) the market incumbents "Montreal’s Bed and Breakfast Association" want protection and b) the government wants to protect existing tax revenue/regulation fines.

At this point, it's not about externalities. It's about protecting current revenue streams. While ignoring the potential for far greater tax revenue and social benefit.

sultezdukes• 13 years ago

The incorrect and intellectually insufficient narrative is:

The goal, she said, is to ensure the safety of visitors to the province.

That's not the primary goal, or I would say even the secondary goal. The primary goal is obviously taxes, and the secondary goal is satisfying lobbying pressure from those that don't like the competition.

But let's not pretend that there are no problems with it, and that there are no legitimate reasons to object to it.

Let's not pretend that these regulators are actually honest in their arguments.

Spooky233• 13 years ago

It's also to protect the integrity of the neighborhoods and the well-being of those who live around them.

I own a home, pay residential taxes and expect to have homeowners or tenants living next door. When my neighbor is running an unregulated flophouse, usually without paying sales, lodging and other taxes my property and I suffers.

People who operate hotels have to comply with all sorts of burdensome regulation. Some of that regulation is guided by local zoning (max size, parking demand), others by safety (fireproofing measures, security), others by revenue needs (ie. lodging tax).

wyck• 13 years ago

If you're using your house as a commercial establishment (short term rentals) you are paying commercial taxes on it, there is no reason why you should somehow be exempt when others are not.

It's not just a fine, if you using your house as a commercial space when you go to sell your house it will be taxed on sale just like any other commercial entity. I'm surprised other regions are not more adamant about enforcing this.

ps. This is not about Airbnb, they crack down on any listings no matter what the site (tripadvisor, homeaway, vrbo, craigslist, etc).

chm2• 13 years ago

You shouldn't blame the Government for enforcing its laws.

I would like for competition to be more open than it is, but I pay my taxes and would like others to do so too.

stfsbrb• 13 years ago

Amazing that you got downvoted for this. The comments in this thread which are cheerleading "disruption" are completely glossing over the issues of taxes and regulations. Other startups are out there making good faith attempts at following the law and competing fairly. Why does HN seem so eager to collectively give AirBnB a free pass?

miguelrochefort3• 13 years ago

These new services simply make the regulation and taxation issues more and more obvious. You can't stop technology, you can't stop innovation. Once you acknowledge that, you realize that laws have to adapt to new realities.

jacquesm• 13 years ago

> Why does HN seem so eager to collectively give AirBnB a free pass?

It may have something to do with AirBnB being one of the two top YC backed companies (the other is dropbox).

cozeulodorieso• 13 years ago

Disruption is great. Disruption means doing something else is doing, but much better.

AirBNB -- in this context -- isn't being disruptive to the hotel industry. They're doing the same thing, but _worse_. Where legal hotels have consumer protections (like definitely not having lead paint and definitely sufficient fire escapes), AirBNB... doesn't. Where hotels (and B&Bs, etc.) follow zoning rules to make sure they're good neighbors, AirBNB... doesn't.

Now, these rules don't work all the time. They probably can be improved. But don't act like they're merely regulatory capture. That's an aspect, but consumer protections are real. AirBNB isn't doing the same thing better, but doing a different thing worse.

danielharan• 13 years ago

Cry me a river. There are much more comprehensive reviews on Airbnb than you'll get for most hotels.

This is regulatory capture under the guise of consumer protection; nothing more.

Spooky233• 13 years ago

Not really, it's about a company choosing to ignore the law. Craigslist did the same thing for years with respect to advertising for "erotic services".

If the company's strategy for this issue is to declare that "users must be aware of local regulation" while providing thousands of listings in heavily regulated cities like New York City, they're probably going to hit some speedbumps.

weisser2• 13 years ago

I may be downvoted to oblivion for this but I really don't think my neighbors in Boston would like it if I rented my room out on a nightly basis to people they don't know. There are 20 units in my building so seeing many random people coming and going would trigger great unease and I cannot say that I would blame them for that.

I've used AirBnB and I love it but I think the biggest issue is not the commercial property taxes (the gov't would likely disagree) but the negative impact it could have on those living around you in other apartments. It kind of goes back to the saying, "I don't care what people do in the comfort of their own home," except the entranceway, stairwells and halls of an apartment building are the shared property of all residents. This is not so much an issue when people rent out their houses on AirBnb but my guess is that apartments in major cities are some of their most frequently booked listings.

mef• 13 years ago

To play devil's advocate to this argument, what's the difference between having new tenants entering the building every week and a resident having random friends over every week?

tincholio• 13 years ago

That it's less likely for someone to have so many random friends over to their place when they're not around.

rpedroso• 13 years ago

Tenants have a stake in their apartment, their relations with their neighbors, etc. While the vast majority Airbnb renters don't trash apartment buildings, I'd bet that they're more disruptive on average than tenants.

alukima• 13 years ago

The rent controlled tenants below me pay about $800 for a unit that now rents for $3200 a month. Last year when they bought a home they decided to keep the apartment to use as a pied-à-terre and rent it out on Airbnb.

I found out about this after having three different people in a weeks time knock on my door and ask me where the fuse boxes are. Not a huge deal if my neighbors do it, but these are total strangers. At least when someone moves in to my building they have multiple background checks. And since full time residents live here they have a reason to be polite as they see me daily. They have some connection to the building and its residents.

A few weeks after the start of this I was woken up at three A.M. by my dog barking at the fire escape. There was someone on the fire escape looking into my bedroom window! After calling the police I found out that it was a renter from the unit below who wanted a better view and decided to peek into my unit at the same time. This has happened half a dozen times in the last year.

I work typical business hours. People who stay in the unit as guests are generally on vacation and this can lead to loud parties that last all hours of the night. I have a few neighbors who work strange hours and we work out noise agreements, you can't do that with people who are staying one or two days.

There's also the moral issue. It's hard to find a place in San Francisco, what they are doing is illegal, against the terms of their lease (it's very hard to evict tenants in San Francisco, the owners are trying), and they are denying someone a full time residence so they can make extra cash.

I like the idea of Airbnb but I agree that the people who rent units need to be held to some standards. A permit that neighbors can contest seems reasonable if it's going to affect their standard of living.

znowi• 13 years ago

It's disturbing to see a comment prefixed with a concern about downvotes, which suggests a gropthink environment. This is a hackers community. Please speak up without fear of lost karma or reprimand from the local celebrities.

weisser2• 13 years ago

Rightly or not I sometimes feel that dissenting opinions, especially against popular YC companies, are met with contempt. I wouldn't go as far as "groupthink" but I would postulate that an inordinate amount of people that read HN are very supportive of YC companies and dislike when flaws are pointed out about them.

jfim• 13 years ago

I don't know how AirBnB works, but do they charge sales tax and ensure that all relevant tax documentation is provided for renters?

I know Quebec has been cracking down on tax evasion during the last couple of years, enforcing the usage of MEVs (module d'enregistrement des ventes, essentially a sealed sales recorder that prints the bill in a standard format --- an example of the receipt is shown at [1]) for all restaurant sales to prevent the use of "zappers" [2] and educating the public that they should receive such a receipt for all restaurant sales.

[1] http://www.revenuquebec.ca/en/a-propos/evasion_fiscale/resta...

[2] http://en.wikipedia.org/wiki/Automated_sales_suppression_dev...

orangethirty2• 13 years ago

I wonder what will happen when someone declines to leave the rented space. Do they have any law protecting them? Do the property owners have a law that protects them from this? It would be interesting to see how a magistrate would interpret a property owner renting out the place on airbnb. They are not hotels and are not licensed as such.

noarchy3• 13 years ago

Quebec laws are very generous to renters, so this is indeed an interesting question to ponder. As much as one can argue that AirBnb renters are "getting away" with not paying certain taxes, they also may be getting lucky that they don't face non-paying tenants, or ones that simply won't leave.

orangethirty2• 13 years ago

I can see the headline now: I rented my apartment in airbnb and now can't evict the renter. It's been a year.

Maven911• 13 years ago

Quebec has a rich history of socialist laws (not necessairly a bad thing) and rent seeking laws(bad):

Tuition is one of the lowest in North America

Medical benefits paid by the employer are considered taxable income

Weird laws on lotteries and prize giveaways that excludes Quebec from many said prize giveaways

Tourisme board that tacks on a 'travel agency insurance premium' when purchasing vacation packages

Quebec rental board that is very pro tenants and they can stay without paying rent for many months

miguelrochefort3• 13 years ago

I'm ashamed of my province. I'm seriously considering moving south of the border if they don't start to get a little more liberal (not talking about the party here).

onemorepassword• 13 years ago

AirBnB may be the canary in the coalmine for tech, maybe more than the privacy issues surrounding the majority of the current tech business models.

The industry idolizes "disruption" without taking any responsibility for the negative side-effects. However, in the case of AirBnB, these side-effects don't just affect an incumbent industry, but the private lives of completely innocent ordinary people, who live in the same buildings that are used as makeshift hotels.

Illegal and semi-legal subletting is a big enough nuisance as it is in major tourist destinations (I live in one), and AirBnB is making the problem exponentially worse.

A similar narrative applies to the presence of Uber in places with a decently regulate taxi system.

Not all disruption is good.

dmix4• 13 years ago

> Not all disruption is good.

Tor is very disruptive. On one hand it's allowing for political dissidents to speak and access the internet freely. On the other it's used by criminals and child pornographers.

Even if it causes a certain level of harm, as long as there is legitimate benefit, attempting to force everyone to go back to how things were before the technology existed is ultimately futile and unproductive. Just like copyright (bad for record labels) and automated factories (bad for unskilled workers/unions). Or even Walmart (bad for small shops) and drugs (bad for economic productivity).

We should learn to attempt to adapt our laws/policies to the new technology instead of trying to ban it (which is currently the default reaction).

olalonde• 13 years ago

As a side note, there is no way in hell hotel prices in Quebec reflect their fair market value. Hotels are about the same price in Chicoutimi where land is vastly abundant as they are in Hong Kong, a tiny overcrowded island. My gut guess is that real estate prices are at least 10x higher in Hong Kong too. It's very hard to find an apartment below 1000$/month in Hong Kong whereas in Chicoutimi you can find one for 2-3x the price of a night at the hotel. Makes no sense at all even after considering the cheap imported workers hotels in Hong Kong have access too and other economies of scale associated with a densely populated area... Disclosure: I was born in Quebec and have lived in Hong Kong.

pfortuny2• 13 years ago

There will start to be issues and price hikes when accidents happen and the insurance companies start taking notice of this: your home insurance price gets mutliplied by two if you want it to cover short renting...

I see that as a non-legal positive and useful self-regulation of the market.

And then you will get adverts 'this AirBnB rental is insured', etc.

I do not see this solution as bad at all.

And I guess it is related to the hotel and B&B owners' complaints.

Quebec Cracks Down on Airbnb

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