New Regulations Threaten Sharing Economy Tourism

As AirBnB and other vacation rental sites become more popular, government regulation could undermine this emerging sector of the tourism industry.

Businesses like Airbnb, 9flats and Windu are putting a dent in the traditional hotel and bed and breakfast market. But as the popularity of these sites and their services continues to grow, the burgeoning industry is starting to rub regulators and locals the wrong way. In fact, regulations are in various stages of development in New York, Berlin and Amsterdam.

In Berlin, the case is being that apartments held for off-the-beaten-path tourism are tying up properties that could be housing Germans and Berliners. If the regulation is successful, it could cut the number of holiday rental properties by around one third. Ryan Levitt of housetrip contends that the decision is a little backwards given Berlin’s desire to become a tech hub.

Levitt added that the position was one of “We don’t want you foreigners.” Roman Bach, Spokesperson for 9flats, notes that the demand will still exist, and the law could be “Driving this economy underground and into shadowy areas of the legal system.”

Amsterdam seems to recognize the potential of a light, agile new industry. According to Levitt, the position of the government is “‘we can ban this’ and it would be stupid to try.” These regulations could easily be the canary in the coal mine for the sharing economy, at least in the tourism sector. Big changes could be on the way for more than just apartment rental.

Ride sharing, couch surfing and apartment renting are all part of the rise of the sharing economy, and relatively news ideas when it comes to tourism. Governments are working to either integrate these businesses into the rest of the industry, or they’re trying to edge them out in favour of existing larger businesses. Depending on the regulations, an emerging sector of the tourism industry could be snuffed out.

Image credit: Kevin Krejci