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Amsterdam confronts the accommodation sharing economy

25 June 2015
25 Jun 2015 -

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The accommodation sharing economy is presenting challenges for businesses citizens and governments from New York to San Francisco, and Berlin to Barcelona.

While a number of cities have found themselves debating the merits of short-term rental accommodation in the courts, the city of Amsterdam, long considered a progressive and liberal city, has implemented a different approach.

A number of Amsterdam residents found a note from the local council in their letterboxes this week about short term house sharing for tourists.

Cleverly designed to look like a hotel ‘Do not Disturb’ door sign, the message informs citizens about the key rules of renting out their rooms or houses to travellers, while directing them to a website for full laws and regulations.

The door sign and the website spell out strict and clear regulations; there are maximum guest numbers per stay, a maximum of 60 rental days per year, the body corporate must approve, the host must own the property, and there are fire safety compliance and nuisance rules. Hosts are also reminded about their obligation to declare income from any rent received.

While not explicitly referring to Airbnb, the door sign appears to come off the back of the December 2014 agreement between Airbnb and the City of Amsterdam to promote responsible house sharing.

Amsterdam has a history of dealing with controversial issues on a premise of acceptance rather than resistance, imposing regulations to deal with issues within a legal framework- such as its approach to drugs and prostitution – rather than simply declaring them illegal. The city’s partnership with Airbnb, declared by the city to be first of its kind in Europe, appears to be another example of this progressive attitude.

Services such as Airbnb, Couchsurfing, Nightswapping and HomeCamp now enable anyone with a spare bed, a couch, or even just a patch of grass on which to pitch a tent, to become an accommodation provider overnight. While it may seem great for the host who can earn some extra income, or for the traveller looking for that particular experience, the problems claimed to arise from this are many and varied.

Concerns have been made by consumer groups, property owners, and the hostel and hotel industry about matters including building safety issues, to noise and waste nuisance, allegations that short-term rentals push up rents in already over-priced rental markets, to insurance and liability concerns.

One of the common concerns among the hostel and hotel industry across the globe surrounds competition, particularly around the costs and collection of tourist taxes. Hostels and hotels are required to collect tourist taxes for the city, but as short term room or apartment rentals tend to lack legal formality, such taxes often don’t form part of the equation. Bureaucracy and administrative burdens that accompany a formal business can also add to the pricing equation, with prices offered by apartment hosts often undercutting prices that established businesses can offer.

The issue of administration and bureaucracy costs at industry level may ultimately be a bigger one, but the rules and regulations around short-term house rentals in Amsterdam appear to make some fairly major inroads in levelling the playing field. Airbnb have agreed to prominently display the laws and regulations around house sharing to hosts when they sign up, and will email hosts twice a year to remind them of their obligations.

In particular, insofar as taxation collection is concerned, the Amsterdam Airbnb agreement also appears to go some way towards alleviating a key hostelier and hotelier concern. In February this year, Airbnb started to collect and remit the tourist tax on behalf of hosts.

The Amsterdam council 'Door Sign'

Pieter van der Zeeuw, director of the Hans Brinker Hotel in Amsterdam, feels that ultimately competition from the short term apartment rental sector is good, as long as it is fair.

“Every property has its own fan base, and the short term accommodation rentals have their own. The hostel and hotel industry should not be afraid of them, but should look at themselves and consider what they could do better, to be unique and give visitors that special experience they are looking for.”

 The Amsterdam council door sign may be little more than a clever marketing campaign, but nevertheless it is one that brings some of the hot issues- especially around tax and length of stay per year- to the mind of the potential citizen host, rather than just being an industry issue played out in the newspapers or in courtrooms.

What impact the progressive Amsterdam approach to the short-term rental market ultimately has on the hostel and hotel industry in the city remains to be seen.

In a city that seems to have an almost insatiable tourist appetite, according to the Amsterdam council at least 73% of listed Airbnb properties were outside the neighbourhoods where the majority of hotels were located.

Further, the hostel market place itself is expanding, with a number of big-name hostels, including Clink, Generator and A&O Hostels, adding over 2500 beds to the low-cost accommodation sector in the city this year.

Only one thing is sure; the Amsterdam traveller has an almighty choice about where and how they stay.