Don: Airbnb, VBRO regulations will force rentals into an underground market

As Seattle considers placing regulations on operators of Airbnb, VBRO, etc. there are others arguing that the city is pursuing a misplaced “one-size-fits-none” approach to solve a housing crisis.

Count KIRO Radio’s Ron and Don among them. They question if the regulations are appropriately aimed — or will even work.

Related: Over-regulation or market correction? Seattle takes on Airbnb

Under the proposed regulations — which have yet to be officially drafted — properties that aren’t occupied by permanent residents would be prohibited from having more than 90 nights of short-term rentals per year. Council member Tim Burgess is spearheading the effort and argues that the regulations could free up housing for Seattle’s long-term renters — residents who cannot afford to live in town.

“Their logic is that we have a shortage in housing stock, therefore if we clamp down on Airbnb, that will increase the housing stock — the rental stock,” Ron said. “And people will then be able to afford rent in the City of Seattle. That is absolutely faulty logic.”

Ron argues that the housing being used for services such as Airbnb are not the same stock as the rental market — it’s not housing apt for rentals. Also, the city estimates that the regulations will affect hundreds of units — which is a small drop in the bucket when it comes to housing.

The city believes that 80 percent of Airbnb providers would not violate the 90-day rule and therefore would not be affected by any regulation. Those who rent for longer than 90 days would be required to get a business license and pay applicable taxes, as well as share quarterly rental data with the city.

That will have one result, according to Don.

“What’s going to happen is it’s just going to go underground,” Don said. “I think a lot of it already has. I see this going on in my neighborhood in the same way I see a lot of building going on in my neighborhood and nobody is reporting it to the city.”

“(Hosts) will take a lot of tax money and stick it in their pocket,” he said. “And let’s face it, there is not an Airbnb police force. If someone breaks into your car, in most parts of the city, the police aren’t coming. So let’s say a neighbor reports you because you are renting out an apartment or space that you have, maybe you get a letter in the mail — probably not — but I don’t think anyone is coming.”

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