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So What's This "Sharing Economy" Doing to San Francisco's Housing Market?

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[Photo Credit: Airbnb]

Mayor Lee is thrilled that Airbnb, the short-term vacation rental site, is doing so well that they set up a new HQ here in San Francisco. Underlying this successful foray into what they call "the sharing economy," however, is a thorny urban issue— the removal of rental units from the pool of housing available to permanent residents. Or the talented people who move here to become "San Franciscan." While a lot of these are rooms in people's current residences, they provide accommodations far less expensive than hotels and pay no occupancy taxes into the city's coffers, and in direct competition with hotels without having to contend with the hotel workers union, Local 2, or the rafts of corporate types who make hotels run.
According to their site, there are more than 1500 short-stay apartments available through Airbnb here in San Francisco. Plus more casual bits, ranging from half a trundle bed ($20 per night for 6 nights) in the Excelsior, to a couch in the Castro ($85 a night.) Apartments range from a condo in Millennium Tower with pool/spa priveveges ($500 a night to $9000 per month) to a studio ($145 a night) in the Haight. For the entire Bay Area, there are over 2900 listings ranging from Half Moon Bay to Sausalito to Berkeley.

On Commercial Street in Chinatown, a 5-bedroom apartment accommodating 10 (or 12— the listing's not entirely clear) is set up as "Student Housing" for $21 a night and is fully booked for May and June. If there are 12 persons, that's around $15,000 revenue for two months. According to the owner's profile, he's been running this place for 20 years.

As for Airbnb, their idea is not new, just better packaged than their competition and easily accessible for both landlords and visitors. And San Francisco is not alone. A similar situation exists in Paris, where short-stay rentals have been outlawed altogether. Rather than a burgeoning tech industry, the pressures in Paris have to do with a tremendous influx of foreign investment as Russians and Chinese buy apartments (having followed Americans and Italians) combined with an even more rigid system of rent control than we have here. But there's money to be made— and so Airbnb has over 4000 listings in Paris and the surrounding suburbs. [Disclaimer: We've used short-term vacation rentals in Tuscany, Rome, Paris and SW France. They were all great. We just took no account of the effect on the local housing situations.]
· Airbnb Commits To Signing A 10-year Lease [Curbed SF]
· Half a Trundle Bed [Airbnb]
· Castro Couch [Airbnb
· Millennium Tower Rental [Airbnb]
· Monthly Shared Rental For Students [Airbnb]

Airbnb HQ

99 Rhode Island Street, San Francisco, CA 94103