Airbnb readies for its regulatory hurdles

AllThingsD reports that Airbnb has hired away David Hantman, Yahoo’s deputy general counsel. In a memo to colleagues Hantman writes:

 

“[Airbnb has] some huge challenges with a few antiquated laws in their biggest markets, so my job will be to help them convince governments that allowing people to rent out their own homes or apartments should not be a problem, and that in fact it is great for the economy and for the tons of people that can only pay their mortgage or rent through the extra income they get from Airbnb … As always, I like to be on the right side of history, and I believe in the mission and the team over there.”

 

It’s unclear how long Airbnb will be able to hang on before it has serious regulatory problems, and to my mind, serious legal liability issues. It’s a long list of issues but it includes laws that forbid short term rentals in certain markets, whether landlords can start evicting their tenants for renting out their apartments, who’s liable in the event of injury to an Airbnb renter, and how states and municipalities want to start taxing Airbnb hosts.

Hantman ran Yahoo’s government relations efforts in D.C., so it would appear that the companies initial tack will be to go directly to lawmakers to make its case that it’s a legitimate business that deserves favorable legislation. The car sharing industry has gone this route in a few states, securing laws that restrict insurers from dropping drivers from insurance policies if they rent out their cars in a peer-to-peer network like RelayRides or Getaround.

I think Airbnb is growing so fast and reaching enough scale that it’ll be hard to stop, but I do think there are some unforeseen costs in its business model that it’s going to have to deal with as its services are taxed and as landlords or lawmakers start to enforce laws making short term rentals more difficult.

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Adam Lesser

Cleantech Curator Gigaom Research

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