What’s Wrong with Detroit’s Proposed Airbnb Regulation
There are issues with how the implementation of Airbnb has evolved. Those issues should be addressed. But the regulation, as proposed, achieves little of that. In fact, what it mostly achieves is robbing those who arguably are the best examples of the model, while rewarding those who are the almost exclusive problem.
I rent a 3-bedroom flat in Southwest Detroit. One room is used for my home office/library. The other is used as an Airbnb guest room. And the last is my own room. I am a homestay host, meaning that guests who stay with me are staying in my home, with me as their host. There are no bachelor weekends, no leveraging property for income beyond what the local rental market could viably bear.
My motivations were not primarily financial. My motivation when I started here in 2015 was as an ambassador. By introducing Detroit to visitors in a certain way, I was an effective city booster. I’ve had several guests move here after their stay – not all because of me, to be sure, but I have helped shape the view and experience of Detroit for literally hundreds of people.
For me, it was also a way to have the experience of traveling while being temporarily rooted in place. If I couldn’t drop everything and go to Argentina or Egypt or Thailand, as in past years, I could at least bring a steady stream of travelers to me. It offered passive socialization, a way to still stay connected to the bigger world, and a channel for connections I couldn’t have otherwise made. From this angle, Airbnb is a potentially tremendous boon for older residents who suffer disproportionately from isolation. It’s also a great way to expose all Detroiters to a broader milieu, since so many Detroiters have never left the city, much less the state or country.
It was a good alternative to a roommate, because what is tolerable from an overnight guest becomes less tolerable as a daily conflict: questions of toilet seats being left up or coffee grounds on the counter become a guest accommodation, rather than the act of an inconsiderate bastard who hasn’t paid the cable bill. It also provided protections I wouldn’t have had with a roommate, like the ability to have them leave if their behavior was out of line, and an insurance policy included which protected my home from damage. When I first moved into my flat, I had a transient roommate who threatened to kill me, but because she had paid rent, I couldn’t remove her without going through an eviction process. Conceptually, that can’t happen with Airbnb.
In my set-up, in fact, the financial return is not amazing; in no way could I live on it, alone. BUT, it did cover my rent through grad school, which made it possible for me to do other things. By having my basic needs covered by Airbnb and scholarships, I could use my student loans in more proactive local contributions. In that way, it provided a floor I wouldn’t have otherwise had. Like the UBI argument, Airbnb provides just enough of a bump to allow people fuller participation in their local economy.
And that’s what I have heard from guests who have stayed at various places throughout Detroit, and from hosts who have the arrangement that I do: they use the supplemental income stream as a way to cover some remodeling expenses, to support their experimental farm or co-op, to fund their art or whatever project is actually front and center. In this way, Airbnb may be the only true way all residents in the city can directly benefit from Detroit’s “revitalization” – a revitalization which has been lopsided, at best. The ability to share your home is an essential form of economic democracy that, conceptually, no one should object to or be able to take away….and yet, here we are.
The Airbnb model, in its beginning, was the essence of economic democracy. I have a space which is being underutilized. Here is a way to optimize it, both for a visitor who has new access and for me, who may receive a modest off-set to my otherwise fixed expenses. It was, by definition, a host-guest relationship. It was a return to a few of our oldest cultural memories of boarding and rooming houses which provided some of the only legitimate sources of income for respectable widows, for example. We might now think of these arrangements more like co-ops, but the overall function has been consistent throughout generations. Airbnb’s contribution was not the premise of homesharing, but the online platform which made it so accessible to the population at large. No longer did you have to hop off the bus or train or stagecoach and try to figure out where places like these might be located.
Then, as often happens, people started gaming the system. They realized, in certain markets, that they could make a profit as de facto hoteliers who could escape regulatory costs. So, those who had means started buying up houses and apartments to use for the exclusive purpose of short-term rentals, and in that use distortion is where we have seen nearly 100% of the issues which have legitimate critiques: artificial rent inflation, local housing supply contractions, unmoderated behavior from guests staying in unsupervised spaces. It was a perfect formula for extractive wealth exploitation, inflicting maximum harm to the larger host community.
Those issues are real. Those issues are really problems. They absolutely should be addressed. But, like so many attempts at social policy, not enough attention is being paid to the source of the real issues, with consequent targeting of the actual problem. This is not that: a homestay host is not a situation which will lead to any of those real problems. In fact, a homestay host only fosters positive results for the community, in that it engages visitors through true neighborhoods rather than constructed entertainment districts; provides supplemental income which may help people stay in their homes by paying rent, taxes and maintenance costs; and as mentioned before, provides a really deep opportunity for meaningful social exchange and expansion.
So, using a broad brush to regulate Airbnb across the board, without differentiating among its many configurations, is just short-sighted, at best, and possibly motivated by other factors. It is curious that when Detroit had few hotel options, no one much cared about Airbnb. But now that several high-end, boutique hotels have opened downtown, suddenly there’s a lot of concern about the cheap competition. The reality is that these guest populations rarely overlap: none of my guests were or are going to stay at the Westin instead of my house. Why people choose a homestay Airbnb does have a financial component, but not exclusively. These are people who are looking for a local, embedded experience, and they are not likely to exchange a $50 guest room in someone’s Mexicantown home for $175 room in a downtown hotel.
Therefore, several of the proposed criteria in the ordinance are just poorly conceived. Limiting the density of short-term rentals makes sense if you are limiting stand alone guest houses, but not when someone is an overnight guest of a resident. Why the ownership requirement? That’s the most base, anachronistic form of economic discrimination and ironically targets the population most vulnerable to gentrification processes, the low-income renter. If the landlord doesn’t prohibit the use, it’s hard to argue how an overnight guest is appreciably different – in terms of use – than a roommate. The registration fees are just another way to penalize those who would most benefit from shared homesteads, since it creates a financial burden for people who may genuinely need the supplemental income, especially since there is a proposed cap on total rental days per year.
Again, a lot of these restrictions make sense when presuming short-term rentals as stand alone vacation units. But none of them make sense when considering the original model of homestay hosting. There does not appear to be any awareness of the variation in Airbnb, or an understanding of how it’s being used by residents.
Further, these restrictions will mostly drive the business underground. People who have now identified the benefits of this reciprocity will drop off Airbnb, but use other means to attract guests. With that shift will come an inability to regulate and also appreciably increase risks to residents. If the guest market is driven off the Airbnb platform, we can expect more incidents of assault, theft, overstays, vandalism, harassment and other hazards.
It will also mean that other codes will need to be updated, since the margins of roommate definitions will become the slippage. It’s already the case that DPD hasn’t gotten the memo about Airbnb implications: just recently, I was confronted with a very hostile police force when a cancelled reservation crossed into trespassing. An ordinance around Airbnb use will require definitive instruction about enforcement for conflicts.
Ultimately, I agree that thought and policy need to be applied to the unintended consequences of Airbnb and the manipulation or extension of its original form. But we need to ensure that the response addresses the problems we’re trying to solve, and isn’t just a random reaction which is ill-informed. A sizable portion of Detroit’s struggles are self-inflicted wounds from poor policy over decades. We have an opportunity to learn from those mistakes, rather than repeat them. Here is one front which is relatively simple to evaluate….if the motivations are as stated, which is to protect vulnerable renters and support positive community identity.