Airbnb Aims to Placate Paris Regulators With Rental Cap
Move will force hosts to comply with Paris’s legal limit of 120 days a year on short-term rentals
PARIS—Airbnb Inc. plans to curb rentals of some of its most popular listings in the French capital, expanding its bid to placate regulators in the U.S. and Europe that have assailed the firm and could threaten its growth.
The home-sharing firm said Tuesday it will start automatically capping the number days a year that hosts can rent out dwellings in parts of central Paris—the company’s largest market by listings, with 65,000. That will effectively force hosts to comply with the city’s legal limit on short-term rentals of homes of 120 days a year.
Airbnb’s decision to enforce a Paris cap is the first expansion of a measure the firm rolled out last year in London and Amsterdam, establishing it as a template in the company’s efforts to calm activists and regulators world-wide. Many cities argue that the firm’s short-term rentals make it more lucrative for property owners to cater to tourists than to rent out homes to long-term residents, and sought to limit them.
“We want to do our bit to address historic housing concerns in central Paris and help make this city a better place for everyone,” said Emmanuel Marill, Airbnb’s general manager for France.
Airbnb’s fast growth since its founding in 2009 has helped the San Francisco-based firm catapult to a valuation of $31 billion. But similarly to opposition that Uber Technologies Inc. has faced from taxi operators and regulators, Airbnb has clashed with major hotel chains whose business it is disrupting and faced ire from city officials world-wide who view the company as upsetting their local residential ecosystem.
Airbnb has long denied having a significant impact on housing, but in recent years it has also started making an effort to cozy up to local officials and soothe their complaints on the issue—in part to help avoid or overturn legislation that could restrict its operation. In March, the company settled a lawsuit it had filed against a tough San Francisco law by agreeing to help register hosts on behalf of the city. In Berlin, the company has lobbied heavily to convince legislators to revise a law that makes it difficult for many residents to rent out their homes.
One of the firm’s biggest concessions so far has been the voluntary curbing of its most prolific hosts—which the firm says represent a small sliver of its listings, but likely account for a larger slice of its revenue.
So far in London, the company says the effort successfully has pared listings. The number of rentals that go over the city’s 90-day-a-year limit has declined from 21% of rentals before the rule to 7% this year, the company said in a September report. The rentals still over the limit include apartments with special authorization and those that went over the limit before the cap was applied, Airbnb said.
In Paris, the new policy, which goes into effect in January, will block Airbnb listings in the city’s first four arrondissements from being rented for more than the citywide legal limit, unless the property owner has proper authorization. The area Airbnb is subjecting to the cap includes tourist-filled neighborhoods like the Marais and landmarks like the Louvre Museum, but doesn’t include other popular areas like Montmartre or the Left Bank, even though they are also subject to the legal limit.
An Airbnb spokesman said the company hasn’t placed caps on other neighborhoods because its goal isn’t to help enforce the law, but rather “to address local problems where they are.” He said the city had been briefed on the change.
A city official in charge of housing policy didn’t immediately respond to a request for comment.
It is unclear what financial hit Airbnb might take by curbing what are, by definition, its most active rentals in what are some of Paris’s most expensive neighborhoods. An Airbnb spokesman declined to say in absolute terms how many listings the company currently has currently that are rented above the 120-day limit, but said they account for 0.64% of the total housing capacity in Paris. That works out to about 8,700 dwellings, given Paris’s total of 1.36 million units, according 2014 figures from government agency Insee.
The spokesman said company expects “minimal impact on the number of guest arrivals” because people who would have otherwise stayed in central Paris will stay in other areas of the city.
Airbnb is implementing the automatic cap in Paris just a few weeks before the the city obliges owners of noncommercial residences on platforms like Airbnb to register with the city, and to post their registration numbers on their listings. Airbnb has updated its website forms to accommodate the numbers, but says it won’t force hosts to post them.